Göttingen (n-t), 25.01.2004 09:56
Annual Financial Results for FY 2003: Cost-cutting measures proven to be effective - Key balance sheet data significantly improved - 2004: Expect similar sales in 2004 and negative earnings
Sales of EUR 77.6 million below expectations Earnings burdened by one-off expenses and push down accounting effects resulting from Coherent's acquisition of 33.9 percent of the outstanding stock in
Lambda Physik AG (Prime Segment, SIN 549 427), one of the world's leading suppliers of pulsed UV lasers, today announced the final results for FY 2003 with sales of EUR 77.6 million (October 1, 2002 to September 30, 2003). Compared to revenues of EUR 98.5 million in fiscal year 2002, this represents a decline of 21 percent. The operating result was EUR -11.1 million after EUR 1.6 million in 2002. Earnings before taxes declined from EUR 0.2 million to EUR -9.9 million. Earnings were negatively impacted by the continued economic weakness in several of the company's markets, a low utilization of production capacity, write-offs of inventory, a deferred tax asset valuation reserve, and by push down accounting effects based on the acquisition of 33.9% by Coherent Holding GmbH. The company reported a net loss of EUR 15.7 million in fiscal year 2003 or a loss of 118 cents compared to a net loss of EUR 1.3 million in the previous year or a loss of 10 cents in fiscal year 2002.
Fiscal Year 2003 was characterized by a significant downturn in the industrial segment. Industrial applications, such as applications in the flat panel display industry, experienced the biggest decline with sales falling by 34 percent from EUR 53.8 million in fiscal year 2002 to EUR 35.3 million. Scientific and medical applications also recorded a decrease in sales of 16 percent from EUR 19.8 million to EUR 16.7 million in fiscal year 2003. At EUR 25.6 million, lithography sales in the most recent year were higher by 3 percent year-on-year. Revenues from the technology portfolio in the form of patents and licenses were reduced to a more normal level at EUR 0.1 million after a very positive development in FY 2002, when these revenues increased to EUR 2.1 million. Bookings dropped to EUR 58.6 million during fiscal year 2003 compared to the prior year bookings of EUR 90.5 million. The order backlog as of September 30, 2003, was EUR 23.4 million compared to EUR 42.5 million as of September 30, 2002.
On April 18, 2003, Coherent Holding GmbH announced a tender offer to purchase all of the remaining outstanding shares of Lambda Physik AG. As of September 30, 2003, Coherent had acquired an additional 33.9% of the outstanding stock in Lambda Physik bringing Coherent's ownership to 94.3%. Stuff Accounting Bulletin (SAB) 54 requires that "push-down accounting" be applied whenever the separate financial statements of a substantially wholly-owned entity are presented in filings with the United States Securities And Exchange Commission (SEC). "Push-down" is a basis of accounting that reflects the parent company's cost in the separate financial statements of a purchased subsidiary. Any difference between the purchase price and the net book value of the entity acquired is "pushed down" to the subsidiary's financial statements. Coherent decided to reflect push-down accounting for its non-SEC registrant subsidiary, Lambda Physik AG. Lambda Physik therefore adjusted its consolidated assets and liabilities to reflect Coherent's basis in Lambda Physik's assets and liabilities based on their estimated fair values, which were based on independent appraisals, valuations, estimations and other studies at the time of Coherent's investments.
The fiscal year 2003 figures include push-down accounting entries when compared with fiscal year 2002 results which exclude push-down accounting entries. Total operating expenses were down 1.5 percent from EUR 32.7 million in fiscal year 2002 to EUR 32.2 million in the most recent fiscal year. Administrative expenses were reduced in fiscal year 2003 due to the cost reduction programs in place but were negatively affected by extraordinary expenses for severance to managers as well as for legal and consulting fees in connection with the tender offer. Selling, general and administrative expenses were reduced from EUR 18.6 million to EUR 17.7 million. In line with the company's strategy, research and development expenses (gross) were reduced by 10 percent to EUR 13.4 million from EUR 14.9 million. At 17 percent of sales, R&D expenses nevertheless remained at a high level. As part of the XTREME technologies joint venture, Lambda Physik in the past fiscal year expensed an additional EUR 1.8 million for the development of extreme ultraviolet light sources, the next-generation technology for the production of microchips in the semiconductor industry.
Lambda Physik improved its balance sheet in certain major areas during the past fiscal year. Accounts receivables were reduced from EUR 19.9 million to EUR 14.1 million at September 30, 2003. Inventories dropped to EUR 35.1 million at year-end compared to EUR 37.0 million in the same prior year period mainly due to inventory write-offs. Deferred tax assets were reduced from EUR 9.5 million to 3.2 million at the end of 2003. Current liabilities were reduced considerably from EUR 34.4 million in the fourth quarter of 2002 to EUR 21.9 million at year-end 2003, mostly due to the re-payment of short-term loans.
Cash flow from operating activities was EUR 12.8 million at year-end 2003 after EUR 18.0 million in the previous year. Cash and cash equivalents declined from EUR 36.0 million in 2002 to EUR 27.1 million at year-end 2003. The equity ratio improved from 76 percent to a current level of 82 percent.
After a careful evaluation of the development of the overall economic situation and the markets, Lambda Physik assumes that revenues in fiscal year 2004 will only be marginally higher than those seen in the past year. In view of new development projects for the semiconductor industry, Lambda Physik intends to expand its R&D expenses considerably which will lead to negative earnings in FY 2004. Lambda Physik management continues to believe that growth prospects are positive in the high-tech markets for which Lambda Physik provides a key technology.
About the company
Lambda Physik is one of the pioneers and world leaders in the development and production of pulsed UV lasers such as excimer lasers, diode-pumped solid-state lasers, and dye lasers. Founded in 1971, the company is the sole or leading supplier in growth markets for applications in industry, science, and medicine and has become a major supplier in the area of microlithography. The group has subsidiaries in the USA, Japan and Germany.
Further information can be obtained at http://www.lambdaphysik.de or from:
The information contained herein is not for publication or distribution to persons in the United States of America, Canada, or Japan and does not constitute an offer of securities for sale in the United States, Canada or Japan. The securities of LAMBDA PHYSIK AG have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold without registration thereunder or pursuant to an available exemption therefrom.
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Kontaktinformationen:
Lambda Physik AG
Martina Schwarze
Hans-Böckler-Str. 12
37079 Göttingen
Germany
Tel.: +49 (0)551 6938-100
Fax: +49 (0)551 6938-104
ir@lambdaphysik.com
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