STAAR Surgical Reports Strong First Quarter 2013 Financial Results

      STAAR Surgical Reports Strong First Quarter 2013 Financial Results

~Total Sales of $18 Million Increased 16% from Q1 2012 / 21% Increase on
Constant Currency Basis

~~Visian® ICL™ Sales Grew 24% to Record $10.6 Million

~~nanoFLEX™ Toric IOL Launched for Europe

~~GAAP Net Income of $0.01 per share, Non GAAP Adjusted Net Income of $0.08

ompany Continues to Invest to Drive Top and Bottom Line Growth

PR Newswire

MONROVIA, Calif., May 1, 2013

MONROVIA, Calif., May 1, 2013 /PRNewswire/ --STAAR Surgical Company (NASDAQ:
STAA), a leading developer, manufacturer and marketer of minimally invasive
ophthalmic products, today reported record revenue for the first quarter ended
March 29, 2013 of $18.0 million compared to $15.5 million reported for the
first quarter of 2012. The results included sales of $10.6 million of the
Company's Visian ICL product portfolio and $6.3 million of its IOL products
and were in-line with preliminary revenue results announced on April 9. In
addition, Other Product sales increased to $1.0 million. The effect of
foreign currency exchange versus prior year reduced total sales by $750,000
during the quarter.

Gross profit margin for the quarter was 70.3%, consistent with the first
quarter of 2012. Gross margin expansion was limited primarily by a large
increase in very low margin IOL injector systems sales to a third party
supplier for the buildup of their acrylic preloaded product supply, which
appears in the Other Product sales category. This accounted for a 170 basis
point difference in gross margin percentage. If not for this inventory
buildup factor, the gross margin would have been 72%.

Net income for the first quarter of 2013, calculated in accordance with GAAP,
was $471,000, or $0.01 on a per diluted share basis, compared with net income
of $232,000, or $0.01 on a per diluted share basis, in the first quarter of
2012. Adjusted net income (excluding manufacturing consolidation expenses,
distribution transition expenses in Spain, gain (loss) on foreign currency
transactions, fair value adjustment of warrants, and stock-based compensation
expense) for the quarter ended March 29, 2013 was $3.2 million or $0.08 per
diluted share versus adjusted net income for the year ago quarter of $1.4
million, or $0.04 per diluted share.

Operating expenses for the first quarter of 2013 were $11.6 million, up 9%
from the $10.6 million prior year period reflecting $901,000 (a $346,000
increase) in related charges associated with the Company's manufacturing
consolidation project and a $623,000 increase in sales and marketing expenses
driven by the additions to the Company's headcount throughout 2012 and
commissions paid to the former distributor in Spain for early transition to a
direct sales model. Overall operating expenses were impacted positively by
foreign currency exchange of $351,000.

Income taxes increased to $314,000 during the first quarter of 2013 compared
to $232,000 during the first quarter of 2012. The Company's effective tax
rate for the first quarter was 40%, and is now expected to remain at this
level for the remainder of 2013, versus the previously expected 50% tax rate
for 2013.

Cash and cash equivalents on March 29, 2013 totaled $19.2 million, compared to
$21.7 million at the end of the prior quarter. Cash utilization during the
quarter was impacted by: $563,000 negative effect on exchange, $442,000 paid
to the former Spanish distributor relating to the transition to a direct
selling model (these charges were completed on March 8) and $1.2 million used
for manufacturing consolidation and expansion of the Monrovia, CA facility.

"We are encouraged by the continued revenue growth we are achieving in the
refractive surgery space, which resulted in an overall improvement in
year-over-year sales of 16% for the first quarter of 2013 which on a constant
currency basis is actually 21% growth," said Barry Caldwell, president and
CEO. "Sales of our Visian ICL exceeded $10 million for the first time and
reflected a 24% increase over the same period in the prior year. Visian ICL
sales increased in our focused markets, led by Europe, which increased by 57%
during the first quarter and the Middle East with a 94% increase. The
competitive landscape we face in refractive surgery seems to have changed more
in the past six months than in previous years. LASIK surgery seems to be
facing more difficult negative pressure with most market data showing that
LASIK procedures are declining in major markets. Lenses which attempt to
compete for refractive procedure share which are in the anterior segment of
the eye all seem to be facing new clinical challenges. The Visian ICL sits
behind the iris in the posterior segment unlike those competitive lenses.
Also, our new Visian ICL CentraFLOW™ technology in Europe has been a key
driver of our success in that marketplace," added Mr. Caldwell.

"Total IOL sales in the first quarter of 2013 were $6.3 million, relatively
flat with the comparable period a year ago. On a constant currency basis, IOL
sales increased 10%, reflecting the strength of our recently launched KS-SP
preloaded acrylic IOLs. However, the negative impact of foreign exchange,
which totaled $750,000 for the quarter, was $646,000 for IOLs alone. Japan
represented 56% of all IOL sales, an increase of 25% in total unit sales and a
32% revenue increase without the negative impact of foreign currency
exchange," said Mr. Caldwell. "Backorders of our preloaded acrylic IOLs in
Europe were $900,000 and reflect both the strength of the recently launched
KS-SP and the supply constraints we continue to experience from a third party
supplier. This backorder position is expected to be a limiting factor to our
IOL sales for the entire year and we are evaluating potential options to meet
this demand. During the ASCRS meeting a few weeks ago we formally launched
our new nanoFLEX™ Toric IOL for Europe and would expect to see sales during
the second quarter."

"Many things went right for us both from an operational and commercial
perspective during the first quarter. We are well positioned in two large
markets – Refractive and Cataract - and have a pipeline in place for new
products throughout this year and well into 2014. In addition, we have made
investments to drive future top line and bottom line growth with our spending
to add new sales and marketing positions and our resource dedication to the
manufacturing consolidation project. By maintaining our strong balance sheet,
continuing to invest in focused research & development initiatives, and
keeping a close eye on operational efficiencies, I believe we can achieve our
growth plans for 2013 and beyond," concluded Mr. Caldwell.

Recent Visian Implantable Collamer® Lens (ICL) Highlights

  oICL sales represented 59.0% of total sales, compared to 55.5% of sales in
    Q1 2012.
  oICL sales increased 24% to $10.6 million from $8.6 million in Q1 2012
    reflecting an 18% increase in unit sales and a 5% increase in price.
  oMix between ICL and TICL (Toric ICL) remains approximately 35% of units
    and 41% of dollars are TICLs.
  oOverall sales in the Company's 11 key markets reflected a 25% increase in
  oDuring the recent ASCRS meeting the Company celebrated the following
    successful ICL implant surgeries:

       oOver 350,000 Visian ICL implants.
       oNearly 100,000 of the above were the Visian TICL.
       oOver 16,000 of the above were Visian CentraFLOW ICL implants.

  oAlso during the ASCRS meeting, over 50 ophthalmic surgeons evaluated and
    provided feedback to the Company on the new ICL V5 preloaded design. This
    product is expected to gain CE Mark approval during the third quarter.

Regional ICL Updates

Europe, Middle East, Africa

  oEurope increased 57% in revenue due to gains from the CentraFLOW
    technology, and new sales personnel hired in 2012.

       oSpain grew 156% driven by the conversion from a distributor sales
         model to a direct model. This provided end customer pricing for the
         market. Visian ICL unit growth was 37% for the quarter.
       oStrong growth was also seen in Italy +63%, France +35% and Germany

  oFollowing the introduction of CentraFLOW in the Middle East, sales grew
    94% during the quarter.
  oLatin America grew 25% in revenue. Additional ICL product approvals in
    this market, though difficult to predict, are expected to expand the
    growth in this market.

Asia Pacific

  oAPAC grew 11% in revenue during the quarter.

       oKorea and China both grew 7% in revenue during the quarter. Visian
         CentraFLOW is expected to be approved in Korea approximately
       oJapan grew 14% in revenue, however unit growth was 34% as revenue was
         negatively impacted by currency and price.
       oIndia grew 22% in revenue. Visian CentraFLOW is expected to be
         approved approximately mid-year.

North America

  oSales in the U.S. grew 12% while units grew 14%.

       oLCA-Vision, a major corporate provider of LASIK procedures, reported
         their refractive procedures declined 22% in the U.S. during Q1 and
         their belief that overall refractive procedures declined by 12% to
         16% in the U.S. for the quarter.
       oAbbott reported a decline in their global refractive sales driven by
         a continued soft refractive market.
       oNovartis reported 2% growth in their global refractive sales.

Recent Intraocular Lens (IOL) Highlights

  oFirst quarter IOL sales were $6.3 million, essentially flat to the first
    quarter of 2012. The negative impact of foreign exchange was $646,000 for
    IOLs. Without the impact of foreign exchange, global IOL revenue would
    have grown by approximately 10% on a constant currency basis.
  oIOLs represented 35% of total sales in the first quarter of 2013, compared
    to 41% of total sales in the same period of the prior year.
  oThe Company ended the quarter with approximately $900,000 in backorders
    from European customers. The Company's supplier of acrylic IOLs has been
    unable to meet the high demand for the new KS IOL products.
  oIOL gross margins declined by 100 basis points primarily due to the
    increase of preloaded acrylic IOL sales that are replacing some of our
    higher gross margin silicone preloaded IOLs.
  oIOL sales in Japan represented 56% of all IOL revenues, a 25% increase in
    units. In U.S. dollars, this reflects an 11% improvement or 32% in
    constant currency.
  oPreloaded IOLs were 78% of total IOL revenues as compared to 75% in the
    first quarter of 2012.
  oOverall, IOL sales in the Company's European market were strong, led by
    Italy, France, Latvia and Norway.
  oIn the U.S., sales for IOLs declined, although Toric IOLs increased.
  oThe Company conducted nanoFLEX Toric IOL premarketing clinical trials
    during the quarter and the official product launch for Europe occurred
    during the ASCRS meeting.
  oThe newly enhanced nanoFLEX II IOLs are planned to begin clinical trials
    during the second quarter. The protocol is designed to measure near and
    intermediate visual results as well as rotational stability.

Project Comet Update

  oThe manufacturing consolidation project continues to be on plan. The
    Company shipped the first U.S. manufactured ICLs during the first quarter
    of 2013. Some Visian ICLs are now being supplied by product manufactured
    in Monrovia to approved markets outside the U.S.
  oThe validations for Visian Toric ICLs are expected to be completed during
    the second quarter and the target is to ship the first TICLs at the end of
    the quarter.
  oAll non-sterile preloaded silicone IOLs for Japan are shipping out of the
    U.S. Sterile product is expected to be shipped from Monrovia during the
    second quarter.
  oSeveral key employees from Japan and Switzerland have agreed to relocate
    to Monrovia.
  oKey regulatory approval has been received to relocate the irradiator used
    to manufacture Collamer buttons from Aliso Viejo, California to Monrovia.
  oManufacturing consolidation expenses increased to $901,000, from $555,000
    reported in the first quarter of 2012 due to costs associated with the
    wind down of manufacturing operations in Japan, but are expected to
    decrease in the remaining months of the year, particularly in the second

Expansion of Monrovia facility

The Monrovia, California headquarters was expanded by approximately 26,000
square feet that directly adjoin the current 44,000 square feet. The
additional space is expected to create a more productive working environment
as manufacturing is consolidated at this facility. The Company has incurred
$899,000 in costs to date and expects to spend an additional $264,000 through
the remainder of the year to complete this expansion.

2013 Metrics-Solid Start to the Year, No Change to Outlook

The Company reiterates and will continue to report and update on each of the
2013 metrics quarterly:

  oTotal revenue growth in the range of 8 to 10%.
  oGross margin expansion by a minimum of 250 bps for the year.
  oProfitable on a GAAP basis each quarter.
  oMake continuous quarterly progress towards the full implementation of
    manufacturing consolidation from Japan and Switzerland facilities to the
    U.S. by the end of 2013 while maintaining quality and adequate inventory.

Conference Call

The Company will host a conference call and video webcast today, May 1, 2013
at 4:30 p.m. Eastern / 1:30 p.m. Pacific to discuss the Company's first
quarter 2013 financial results and recent corporate developments. The dial-in
number for the conference call is 877-703-6110 for domestic participants and
857-244-7309 for international participants, both using a passcode 23245755.

The Company will also be using slides to illustrate its first quarter results
and operational progress. The slides and live webcast of the call can be
accessed from the investor relations section of the STAAR website at

A taped replay of the conference call will also be available beginning
approximately one hour after the call's conclusion and will be available for
seven days. This replay can be accessed by dialing 888-286-8010 for domestic
callers and 617-801-6888 for international callers, both using passcode
40120994. An archived webcast will also be available at

Use of Non-GAAP Financial Measures

This press release includes supplemental non-GAAP financial information, which
STAAR believes investors will find helpful in understanding its operating

The Company conducts a significant part of its activities outside the U.S. It
receives sales revenue and pays expenses principally in U.S. dollars, Swiss
francs, Japanese yen and Euros. The exchange rates between dollars and
non-U.S. currencies can fluctuate greatly and can have a significant effect on
our results when reported in U.S. dollars. When preparing its financial
statements in conformance with GAAP, the Company translates foreign currency
sales and expenses denominated in Japanese yen to dollars at the weighted
average of exchange rates in effect during the period. As a result, the
Company's reported performance may be significantly affected by currency
fluctuations. In order to compare the Company's performance from period to
period without the effect of currency, the Company will apply the same average
exchange rate applicable in the prior period, or the "constant currency" rate
to sales or expenses in the current period as well. Because changes in
currency are outside of the control of the Company and its managers,
management finds this non-GAAP measure useful in determining the long term
progress of its initiatives and determining whether its managers are achieving
their performance goals. The Company believes that the non-GAAP
constant-currency sales results measures provided in this press release are
similarly useful to investors to give insight on long term trends in the
Company's performance without the external effect of changes in relative
currency values. The table below shows sales results calculated in accordance
with GAAP, the effect of currency, and the resulting non-GAAP measure
expressed in constant currency.

"Adjusted Net Income" excludes the following items that are included in "Net
Income" as calculated in accordance with U.S. generally accepted accounting
principles ("GAAP"): manufacturing consolidation expenses, Spain
distribution transition expenses, gain or loss on foreign currency
transactions, the fair value adjustment of outstanding warrants issued in
2007, and stock-based compensation expenses.

We believe that "Adjusted Net Income" is useful to investors in gauging the
outcome of the key drivers of our business performance: our ability to
increase sales revenue and our ability to increase profit margin by improving
the mix of high value products while reducing the costs over which we have

We have excluded manufacturing consolidation and Spain distribution transition
expenses because these are non-recurring expenses and their inclusion may mask
underlying trends in our business performance. Expenses associated with the
Company's plans to consolidate its manufacturing operations to the U.S. are
largely expected to be completed at the end of 2013 and the Spain distribution
transition expenses were completed at the end of the first quarter of 2013.

We have excluded gains and losses on foreign currency transactions and the
fair value adjustment of warrants because of the significant fluctuations that
can result from period to period as a result of market driven factors.

Stock-based compensation expenses consist of expenses for stock options and
restricted stock under Statement of Financial Accounting Standards ("SFAS")
No.123R. In calculating Adjusted Net Income STAAR excludes these expenses
and the fair value adjustment of outstanding warrants because they are
non-cash expenses and because of the complexity and considerable judgment
involved in calculating their values. In addition, these expenses tend to be
driven by fluctuations in the price of our stock and not by the same factors
that generally affect our other business expenses.

We have provided below a detailed reconciliation table, which is useful to
investors in providing the context to understand our Adjusted Net Income and
how it differs from Net Income calculated in accordance with GAAP.

About STAAR Surgical

STAAR, which has been dedicated solely to ophthalmic surgery for over 25
years, designs, develops, manufactures and markets implantable lenses for the
eye and delivery systems therefor. All of these lenses are foldable, which
permits the surgeon to insert them through a small incision. STAAR's lens
used in refractive surgery as an alternative to LASIK is called an Implantable
Collamer® Lens or "ICL." A lens used to replace the natural lens after
cataract surgery is called an intraocular lens or "IOL." Over 350,000 Visian
ICLs have been implanted to date; to learn more about the ICL go to: STAAR has approximately 300 full time employees and
markets lenses in over 60 countries. Headquartered in Monrovia, CA, it
manufactures in the following locations: Nidau, Switzerland; Ichikawa City,
Japan; Aliso Viejo, CA; and Monrovia, CA. For more information, please visit
the Company's website at or call 626-303-7902.

Collamer® is the registered trademark for STAAR's proprietary biocompatible
collagen copolymer lens material.

Safe Harbor

All statements in this press release that are not statements of historical
fact are forward-looking statements, including statements about any of the
following: any projections of earnings, revenue, sales, profit margins, cash,
effective tax rate or any other financial items; the plans, strategies, and
objectives of management for future operations or prospects for achieving such
plans; metrics for 2013; statements regarding new products, including but not
limited to, expectations for success of new products in the U.S. or
international markets or government approval of new products; future economic
conditions or size of market opportunities; expected IOL backorder position;
expected costs of Monrovia facility expansion; expected costs and savings from
business consolidation plans and the timetable for those plans; statements of
belief, including as to achieving 2013 growth plans or metrics; and any
statements of assumptions underlying any of the foregoing.

These statements are based on expectations and assumptions as of the date of
this press release and are subject to numerous risks and uncertainties, which
could cause actual results to differ materially from those described in the
forward-looking statements. The risks and uncertainties include the following:
our limited capital resources and limited access to financing; the negative
effect of unstable global economic conditions on sales of products, especially
products such as the ICL used in non-reimbursed elective procedures; the
challenge of managing our foreign subsidiaries; backlog as we prepare for our
manufacturing facility consolidation; the risk of unfavorable changes in
currency exchange rate; the discretion of regulatory agencies to approve or
reject new products, or to require additional actions before approval;
unexpected costs or delays that could reduce or eliminate the expected
benefits of our consolidation plans; the risk that research and development
efforts will not be successful or may be delayed in delivering for launch; the
purchasing patterns of our distributors carrying inventory in the market; the
willingness of surgeons and patients to adopt a new product and procedure;
patterns of Visian ICL use that have typically limited our penetration of the
refractive procedure market, and a general decline in the demand for
refractive surgery particularly in the U.S. and the Asia Pacific region, which
STAAR believes has resulted from both concerns about the safety and
effectiveness of laser procedures and current economic conditions. The Visian
Toric ICL and the Visian ICL with CentraFLOW are not yet approved for sale in
the United States.

CONTACT: Investors                   Media
         EVC Group                     EVC Group
         Douglas Sherk, 415-652-9100  Amy Phillips, 412-327-9499
         Leigh Salvo, 415-568-9348

STAAR Surgical Company
Condensed Consolidated Balance Sheets
(in 000's)
                                               March 29,   December 28,
                                               2013        2012
Current assets:
Cash and cash equivalents                      $ 19,243   $    21,675
Accounts receivable trade, net                 8,607       8,543
Inventories, net                               11,010      11,673
Prepaids, deposits, and other current assets   2,744       2,183
 Total current assets                        41,604      44,074
Property, plant, and equipment, net            6,184       5,439
Intangible assets, net                         1,858       2,142
Goodwill                                       1,786       1,786
Deferred income taxes                          188         187
Other assets                                   1,038       1,131
 Total assets                                $ 52,658   $    54,759
Current liabilities:
Line of credit                                 $  5,300  $     5,850
Accounts payable                               3,663       5,129
Deferred income taxes                          440         439
Obligations under capital leases              701         829
Other current liabilities                      5,075       5,702
 Total current liabilities                   15,179      17,949
Obligations under capital leases              346         488
Deferred income taxes                          892         885
Asset retirement obligations                   646         707
Pension liability                              2,946       2,988
 Total liabilities                           20,009      23,017
Stockholders' equity:
Common stock                                   364         364
Additional paid-in capital                     163,361     162,251
Accumulated other comprehensive income         905         1,580
Accumulated deficit                            (131,981)   (132,453)
 Total stockholders' equity                  32,649      31,742
 Total liabilities and stockholders' equity  $ 52,658   $    54,759

STAAR Surgical Company
Condensed Consolidated Statements of Operations
(In 000's except for per share data)
                          Three Months Ended
                          % of   March 29,   % of   March 30,  Change
                          Sales  2013        Sales  2012       Amount  %
Net sales                 100.0% $  18,001  100.0% $         $      16.1%
                                                    15,509     2,492
Cost of sales             29.7%  5,347       29.7%  4,607      (740)   16.1%
Gross profit              70.3%  12,654      70.3%  10,902     1,752   16.1%
Selling, general and
administrative expenses:
 General and             22.0%  3,958       24.8%  3,860      98      2.5%
 Marketing and selling   29.4%  5,286       30.1%  4,663      623     13.4%
 Research and            7.6%   1,366       10.0%  1,546      (180)   -11.6%
 Medical device tax      0.3%   59          0.0%   0          59      0.0%
 Selling, general,
and administrative        59.4%  10,669      64.9%  10,069     600     6.0%
 Other general and       5.0%   901         3.6%   555        346     62.3%
administrative expenses
 Total selling,
general and               64.4%  11,570      68.5%  10,624     946     8.9%
administrative expenses
Operating income          6.0%   1,084       1.8%   278        806     289.9%
Other income (expense):
 Interest income         0.2%   35          0.0%   -          35      #DIV/0!
 Interest expense        -0.5%  (83)        -0.6%  (95)       12      -12.6%
 (Loss) Gain on foreign  -1.9%  (341)       0.4%   67         (408)   -609.0%
currency transactions
 Other income            0.5%   90          1.4%   214        (124)   -57.9%
(expense), net
 Total other income    -1.7%  (299)       1.2%   186        (485)   -260.8%
(expense), net
Income before provision   4.3%   785         3.0%   464        321     69.2%
for income taxes
Provision for income      1.7%   314         1.5%   232        82      35.3%
Net income                2.6%   $        1.5%   $       $     103.0%
                                 471               232       239
Net Income per                   $               $   
share-basic                      0.01               0.01
Net Income per                   $               $   
share-diluted                    0.01               0.01
Weighted average shares          36,427             36,071
outstanding - basic
Weighted average shares          37,418             38,420
outstanding - diluted

STAAR Surgical Company
Condensed Consolidated Statements of Cash Flows
(in 000's)
                                                        Year Ended
                                                        March 29,   March 30,
                                                        2013        2012
Cash flows from operating activities:
 Net income                                          $   471  $   232
 Adjustments to reconcile net income to net cash
used in operating activities:
       Depreciation of property and equipment           369         317
       Amortization of intangibles                      117         175
       Deferred income taxes                            7           57
       Fair value adjustment of warrant                 (27)        14
       Gain on disposal of property and equipment       (28)        -
       Stock-based compensation expense                 1,034       687
       Change in net pension liability                  58          72
       Accretion of asset retirement obligation         5           -
       Other                                            27          40
 Changes in working capital:
       Accounts receivable trade, net                   (322)       556
       Inventories                                      288         (432)
       Prepaids, deposits and other current assets      (581)       (665)
       Accounts payable                                 (1,328)     (1,100)
       Other current liabilities                        (522)       (390)
        Net cash used in operating activities      (432)       (437)
Cash flows from investing activities:
       Acquisition of property and equipment            (1,218)     (287)
       Decrease in restricted cash, including           -           129
       reinvested interest
        Net cash used in investing activities      (1,218)     (158)
Cash flows from financing activities:
       Repayment of capital lease lines of credit       (242)       (195)
       Proceeds from exercise of stock options          23          837
        Net cash (used in) provided by financing   (219)       642
Effect of exchange rate changes on cash and cash        (563)       (184)
Decrease in cash and cash equivalents                   (2,432)     (137)
Cash and cash equivalents, at beginning of the period   21,675      16,582
Cash and cash equivalents, at end of the period         $ 19,243   $ 16,445

STAAR Surgical Company
Global Sales
(in 000's)
                            Three Months Ended
                                   March 29,         March 30,   %
Geographic Sales                   2013              2012        Change
United States               18.0%  $  3,240 20.5%  $  3,174  2.1%
Japan                       26.3%  4,739      24.9%  3,857       22.9%
Korea                       11.3%  2,035      12.3%  1,903       6.9%
China                       11.5%  2,071      13.6%  2,106       -1.7%
Spain                       7.2%   1,291      3.3%   510         153.1%
Other                       25.7%  4,625      25.5%  3,959       16.8%
 Total International Sales 82.0%  14,761     79.5%  12,335      19.7%
 Total Sales             100.0% $ 18,001  100.0% $ 15,509   16.1%
Product Sales
 Core products
 ICLs                    59.0%  $ 10,631  55.5%  $  8,605  23.5%
 IOLs                    35.3%  6,347      41.0%  6,358       -0.2%
 Total core products       94.2%  16,978     96.5%  14,963      13.5%
 Non-core products
 Other                   5.7%   1,023      3.5%   546         87.4%
 Total Sales             99.9%  $ 18,001  100.0% $ 15,509   16.1%

STAAR Surgical Company
Reconciliation of Non-GAAP Financial Measure
Adjusted Net Income
                                               Three Months Ended
                                               March 29,       March 30,
                                               2013            2012
Net income- (as reported)                      $   471      $   232
 Manufacturing consolidation expenses         $   901      $   555
 Spain distribution transition cost           $   442      $      -
 Foreign currency impact                      $   341      $    (67)
 Fair value adjustment of warrants            $    (27)    $    14
 Stock-based compensation expense             $  1,034      $   687
Net income - (adjusted)                        $  3,162      $  1,421
Net income per share, basic - (as              $   0.01      $   0.01
 Manufacturing consolidation expenses         $   0.02      $   0.02
 Spain distribution transition cost           $   0.01      $      -
 Foreign currency impact                      $   0.01      $  (0.00)
 Fair value adjustment of warrants            $  (0.00)     $   0.00
 Stock-based compensation expense             $   0.03      $   0.02
Net income per share, basic - (adjusted)       $   0.09      $   0.04
Net income per share, diluted - (as            $   0.01      $   0.01
 Manufacturing consolidation expenses         $   0.02      $   0.01
 Spain distribution transition cost           $   0.01      $      -
 Foreign currency impact                      $   0.01      $  (0.00)
 Fair value adjustment of warrants            $  (0.00)     $   0.00
 Stock-based compensation expense             $   0.03      $   0.02
Net income per share, diluted - (adjusted)     $   0.08      $   0.04
Weighted average shares outstanding -          36,427          36,071
Weighted average shares outstanding -          37,418          38,420
Note: Net income per share (adjusted), basic and diluted, may not add up due
to rounding

STAAR Surgical Company
Reconciliation of Non-GAAP Financial Measure
Constant Currency Sales
        March   Effect    Constant  March    As Reported    Constant
        29,     of                    30,                       Currency
        2013    Currency Currency  2012     $      %       $      %
                                                Change Change  Change Change
ICL   $    $      $  10,665  $       $     24%      $     24%
        10,631 34                     8,605   2,026            2,060
IOL   6,347   646        6,993       6,358    (11)    0%       635     10%
Other 1,023   70         1,093       546      477     87%      547     100%
Total  $    $       $  18,751  $        $     16%      $     21%
Sales  18,001 750                    15,509  2,492            3,242

SOURCE STAAR Surgical Company

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