Newport Corporation Reports First Quarter 2013 Results

            Newport Corporation Reports First Quarter 2013 Results

PR Newswire

IRVINE, Calif., May 1, 2013

IRVINE, Calif., May 1, 2013 /PRNewswire/ --Newport Corporation (NASDAQ: NEWP)
today reported financial results for its first quarter ended March 30, 2013,
and its outlook for the remainder of 2013. The company noted the following
regarding the first quarter results:

  oNet sales of $132.6 million;
  oNet income attributable to Newport Corporation of $2.7 million, or $0.07
    per share, when measured according to generally accepted accounting
    principles (GAAP);
  oNon-GAAP net income of $6.2 million, or $0.16 per diluted share, excluding
    the amortization of intangible assets, stock-based compensation expense,
    acquisition-related, restructuring and severance costs, and the tax impact
    of the excluded amounts; and
  oCash generated from operations of $7.5 million, and a reduction in debt of
    $12.1 million.

Commenting on the results, Robert J. Phillippy, Newport's President and Chief
Executive Officer, stated, "While conditions in the primary markets we serve
were generally weak in the first quarter, we did see sequential growth in
orders from customers in our life and health sciences, microelectronics, and
industrial markets, which may reflect the early signs of improving
conditions. We continue to implement our strategic plan, and have made
progress on several of our long-term growth initiatives. We remain confident
that these initiatives, together with effective execution, will position
Newport to achieve significant growth in sales and profitability when
macro-conditions improve."

Sales and Orders

Newport's sales and orders by end market were as follows: 

(In thousands, except        Three Months Ended        Percentage Percentage
percentages, unaudited)
                                                       Change vs.   Change vs.
                             March   December March    Prior       Prior Year
                             30,     29,      31,
                             2013    2012 ¹   2012 ¹   Quarter      Period
Sales by End Market
Scientific                  $    $     $   
research                                       -7.3%        -14.2%
                             30,893  33,319   36,024
Microelectronics           27,730  28,632   36,154   -3.2%        -23.3%
Life and health sciences   31,177  32,283   37,116   -3.4%        -16.0%
Defense and                 15,411  18,312   17,377   -15.8%       -11.3%
security
Industrial manufacturing    27,396  29,097   30,496   -5.8%        -10.2%
and other
                             $    $     $   
                   Total                          -6.4%        -15.6%
                             132,607 141,643  157,167
Orders by End Market
Scientific                  $    $     $   
research                                       -8.3%        7.6%
                             31,489  34,321   29,278
Microelectronics           28,186  26,153   42,168   7.8%         -33.2%
Life and health sciences   30,474  26,975   63,731   13.0%        -52.2%
Defense and                 14,930  18,449   20,114   -19.1%       -25.8%
security
Industrial manufacturing    28,506  27,974   30,813   1.9%         -7.5%
and other
                             $    $     $   
                   Total                          -0.2%        -28.2%
                             133,585 133,872  186,104
Notes:
^1 Certain prior period amounts have been reclassified to conform to the current
period presentation.

On a sequential basis, sales declined 6.4% compared with the fourth quarter of
2012. New orders in the first quarter of 2013 were approximately equal to the
fourth quarter 2012 level. The company noted that first quarter orders from
customers in its life and health sciences, microelectronics, and industrial
and other end markets all increased sequentially compared with the fourth
quarter of 2012, and that the sequentially lower first quarter sales to and
orders from customers in the scientific research and defense and security end
markets were consistent with the continued uncertainty in government funding
levels and the normal seasonal patterns in the research market.

Operating Income and Net Income

Newport reported operating income for the first quarter of 2013 of $4.4
million when calculated in accordance with GAAP. On a non-GAAP basis,
excluding amortization of intangible assets, stock-based compensation expense,
and acquisition-related, restructuring and severance costs, the company's
operating income for the first quarter of 2013 was $11.2 million, or 8.4% of
net sales.

The company has provided a reconciliation of its gross profit, operating
income, net income and net income per diluted share calculated in accordance
with GAAP and on a non-GAAP basis following the statements of income and
comprehensive income included in this release. Management believes that the
supplemental presentation of non-GAAP financial information provides insight
into the company's core business results, as well as a more meaningful
comparison of its financial results between periods.

Cash, Cash Equivalents and Marketable Securities

In the first quarter of 2013, Newport generated $7.5 million in cash from
operations, and reduced its total indebtedness by $12.1 million. As of March
30, 2013, the company had $171.6 million in total indebtedness and $96.2
million in cash, restricted cash and marketable securities.

Financial Outlook

Commenting on Newport's outlook, Mr. Phillippy said, "Based on input from our
customers, we expect conditions in several end markets to improve during the
course of 2013, resulting in increased sales in the second half of the year.
In the second quarter of 2013, we expect sales to be slightly higher than the
first quarter level, based on our current backlog and the anticipated market
improvement. As a result, we also expect slight sequential increases in our
non-GAAP operating income and non-GAAP earnings per diluted share in the
second quarter of 2013. In parallel, our long-term growth initiatives
continue to gain momentum, and we are confident that these will enable us to
accelerate our growth rate in future years.

ABOUT NEWPORT CORPORATION

Newport Corporation is a leading global supplier of advanced-technology
products and systems to customers in the scientific research,
microelectronics, life and health sciences, defense and security, and
industrial manufacturing markets. Newport's innovative solutions leverage its
expertise in advanced technologies, including lasers, photonics and precision
motion equipment, and optical components and sub-systems, to enhance the
capabilities and productivity of its customers' manufacturing, engineering and
research applications. Newport is part of the Standard & Poor's SmallCap 600
Index and the Russell 2000 Index.

To download Newport's investor relations app, which offers access to
itsSECfilings, press releases, videos, audiocasts and more, please
visitApple's App Storefor the iPhone and iPad orGoogle Playfor Android
mobile devices.

INVESTOR CONFERENCE CALL

Robert J. Phillippy, President and Chief Executive Officer, and Charles F.
Cargile, Senior Vice President and Chief Financial Officer, will host an
investor conference call today, May 1, 2013, at 5:00 p.m. Eastern Time (2:00
p.m. Pacific Time) to review the company's results for the first quarter of
2013 and its business outlook for the remainder of 2013. The call will be
open to all interested investors through a live audio web broadcast via the
Internet at www.newport.com/investors. The call also will be available to
investors and analysts by dialing 877-375-4189 within the U.S. and Canada or
973-935-2046 from abroad. 

The webcast will be archived on the Newport website and can be reached through
the same link. An archived webcast will also be available on Newport's
investor relations app. A telephonic playback of the conference call will be
available by calling 855-859-2056 within the U.S. and Canada and 404‑537-3406
from abroad. Playback will be available beginning at 6:00 p.m. Eastern Time
on Wednesday, May 1, 2013, and continue through 11:59 p.m. Eastern Time on
Wednesday, May 8, 2013. The replay passcode is 34470662.

SAFE HARBOR STATEMENT

This news release contains forward-looking statements, including without
limitation statements regarding the company's expectation that the sequential
increases in sales and orders in certain of its end markets may indicate the
early signs of improving conditions in those markets; its expectation of
significant growth in sales and profitability when macro-conditions improve
resulting from its focus on its long-term growth initiatives and its effective
execution, its expectation of improved market conditions during the course of
2013 and increased sales in the second half of 2013, the company's expectation
of slight sequential increases in sales, non-GAAP operating income and
non-GAAP earnings per diluted share levels in the second quarter of 2013, and
its expectation that the company's long-term growth initiatives will
accelerate its growth rate in future years. Without limiting the generality
of the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "intend," "could," "estimate" or "continue" or the negative or
other variations thereof or comparable terminology are intended to identify
forward-looking statements. In addition, any statements that refer to
expectations, projections or other characterizations of future events or
circumstances are forward-looking statements. Assumptions relating to the
foregoing involve judgments and risks with respect to, among other things,
Newport's ability to achieve expected benefits from the integration of
acquired businesses and its other cost savings initiatives; the strength of
business conditions in the industries Newport serves, particularly the
semiconductor and defense and security industries; Newport's ability to
successfully penetrate and increase sales to its targeted end markets; the
levels of private and governmental research funding worldwide; potential order
cancellations and push-outs; future economic, competitive and market
conditions, including those in Europe and Asia and those related to its
strategic markets; whether its products will continue to achieve customer
acceptance; and future business decisions, all of which are difficult or
impossible to predict accurately and many of which are beyond the control of
Newport. Certain of these judgments and risks are discussed in more detail in
Newport's periodic reports filed with the Securities and Exchange Commission.
Although Newport believes that the assumptions underlying the forward-looking
statements are reasonable, any of the assumptions could prove inaccurate and,
therefore, there can be no assurance that the results contemplated in
forward-looking statements will be realized. In light of the significant
uncertainties inherent in the forward-looking information included herein, the
inclusion of such information should not be regarded as a representation by
Newport or any other person that Newport's objectives or plans will be
achieved. Newport undertakes no obligation to revise the forward-looking
statements contained herein to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.

Newport Corporation
Consolidated Statements of Income and Comprehensive Income
(Unaudited)
                                       Three Months Ended
                                       March 30,            March 31,
(In thousands, except per share        2013                 2012
amounts)
Net sales                              $     132,607    $     157,167
Cost of sales                          77,475               89,098
Gross profit                           55,132               68,069
Selling, general and administrative    37,608               44,060
expenses
Research and development expense       13,101               13,799
Operating income                      4,423                10,210
Interest and other expense, net        (2,137)              (2,187)
Income before income taxes             2,286                8,023
Income tax provision (benefit)         (448)                1,435
Net income                            2,734                6,588
Net loss attributable to               (12)                 (4)
non-controlling interests
Net income attributable to Newport     $       2,746  $      
Corporation                                                 6,592
Net income                            $       2,734  $      
                                                            6,588
Other comprehensive income:
Foreign currency translation gains     (2,452)              1,629
(losses)
Unrecognized net pension gains         190                  (16)
(losses)
Unrealized gains (losses) on           (98)                 33
marketable securities
Comprehensive income                  $             $      
                                       374                 8,234
Comprehensive loss attributable to     $            $       
non-controlling interests              (61)                 (42)
Comprehensive income attributable to   435                  8,276
Newport Corporation
Comprehensive income                $             $      
                                       374                 8,234
Net income per share attributable to
Newport Corporation:
Basic                                  $             $       
                                       0.07                 0.17
Diluted                                $             $       
                                       0.07                 0.17
Shares used in the computation of net
income per share:
Basic                                  38,601               37,731
Diluted                                39,260               38,931
Other operating data:
New orders received during the period  $     133,585    $     186,104
Backlog at the end of period scheduled $     149,716    $     174,861
to ship within 12 months







Newport Corporation
Supplemental Non-GAAP Measures
(Unaudited)
                                         Three Months Ended
(In thousands, except per share          March 30,           March 31,
amounts)                                 2013                2012
Net Sales                                $     132,607  $    157,167
Cost of sales:
Cost of sales - GAAP                     $              $    
                                         77,475             89,098
Amortization of intangible assets        895                 180
Stock-based compensation expense         209                 117
Acquisition-related, restructuring and   403                 808
severance costs
Non-GAAP cost of sales                   75,968              87,993
Non-GAAP gross profit                    $              $    
                                         56,639             69,174
Non-GAAP gross profit as a percentage    42.7%               44.0%
of net sales
Operating income:
Operating income - GAAP                  $             $    
                                         4,423              10,210
Amortization of intangible assets        2,586               5,177
Stock-based compensation                 2,269               2,214
Acquisition-related, restructuring and   1,874               2,485
severance costs
Gain on sale of assets                   -                   (166)
Non-GAAP operating income                $              $    
                                         11,152             19,920
Non-GAAP operating income as a           8.4%                12.7%
percentage of net sales
Net income attributable to Newport
Corporation:
Net income - GAAP                        $             $     
                                         2,746              6,592
Amortization of intangible assets        2,586               5,177
Stock-based compensation                 2,269               2,214
Acquisition-related, restructuring and   1,874               2,485
severance costs
Gain on sale of assets                   -                   (166)
Release of valuation allowance against   -                   (1,391)
certain deferred tax assets
Income tax provision on non-GAAP         (3,315)             (2,769)
adjustments
Non-GAAP net income                     $             $    
                                         6,160              12,142
Net income per diluted share
attributable to Newport Corporation:
Net income - GAAP                        $            $      
                                         0.07               0.17
Total non-GAAP adjustments               0.09                0.14
Non-GAAP net income per diluted share    $            $      
                                         0.16               0.31

Newport Corporation
Consolidated Balance Sheets
(Unaudited)
                                     March 30,            December 29,
(In thousands)                       2013                 2012
ASSETS
Current assets:
Cash and cash equivalents            $              $       88,767
                                     83,846
Restricted cash                      3,122                3,107
Marketable securities                9,205                8,498
Accounts receivable, net            89,722               89,445
Notes receivable, net                1,514                1,536
Inventories, net                     108,262              108,728
Deferred income taxes                19,817               19,872
Prepaid expenses and other current   18,111               17,727
assets
Total current assets                 333,599              337,680
Property and equipment, net          81,962               82,843
Goodwill                             79,388               79,586
Deferred income taxes                5,456                5,646
Intangible assets, net               74,651               77,446
Investments and other assets         35,322               37,760
                                     $      610,378  $      620,961
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term borrowings, net           $              $       32,985
                                     35,468
Accounts payable                     30,372               31,061
Accrued payroll and related expenses 26,466               29,096
Accrued expenses and other current   34,945               34,696
liabilities
Total current liabilities            127,251              127,838
Long-term debt, net                 136,170              150,758
Accrued pension liabilities          26,561               27,764
Other liabilities                    22,925               23,783
Total stockholders' equity of        296,146              289,432
Newport
Non-controlling interests            1,325                1,386
Total stockholders' equity          297,471              290,818
                                     $      610,378  $      620,961



Contact:
Charles F. Cargile, 949/863-3144
Newport Corporation, Irvine, CA
investor@newport.com
or
Rob Fink, 212/896-1206
KCSA Strategic Communications
newport@kcsa.com



SOURCE Newport Corporation

Website: http://www.newport.com