Circon announces first-quarter 1995 results.

SANTA BARBARA, Calif.--(BUSINESS WIRE)--April 26, 1995--Richard A. Auhll, chairman and president, Wednesday announced Circon Corp.'s (NASDAQ/NMS:CCON) first-quarter 1995 results.

Circon's sales set an all-time first-quarter record. In addition, net income increased 40% and operating income and EPS were both up 30%. The excellent reception accorded Circon's new products coupled with the improving trends in the health-care equipment markets are the primary reasons for the improved performance.

Total sales of $22.5 million were the highest sales of any Circon first quarter. The $1.6 million, or 8%, sales increase over the first-quarter 1994 resulted from growth in both the domestic and international medical sectors.

Circon's gross profit for the first quarter totaled $11.8 million, up $0.9 million over 1994. As a percent of sales the 52.7% achieved for first-quarter 1995 was up slightly over first-quarter 1994, and up solidly over the last two quarters of 1994.

Operating expenses for the quarter totaled $10.4 million, up 5.8% over the comparable 1994 period. Selling, general and administrative expenses were up 9.6% due to the promotional efforts associated with the launch of Circon's new VaporTrode Electrode and Continuous Flow Rotating Resectoscope System.

R&D expenditures totaled $1.8 million, or 8% of sales. Circon's R&D expenditures have and will be maintained at a relatively high level but as a percent of sales are now expected to decline as sales grow.

Circon's strategy since mid-1993 of controlling expenses, and not making drastic reductions in marketing, customer service, or R&D in order to radically boost short-term profits, now appears to be validated. Circon entered 1995 with an outstanding array of new products, a solid sales and marketing organization, and is now able to benefit from the growth in its markets.

Circon develops, manufactures and markets advanced endoscope and video systems for minimally invasive surgical applications. Circon is the largest U.S. producer of medical endoscope and video systems. -0-

CIRCON ANNOUNCES
FIRST-QUARTER 1995 RESULTS

                            CIRCON CORP.
                      CONDENSED BALANCE SHEET
                      (Unaudited, in Millions)

                                       March 31,
                                  1995           1994

Cash and equivalents             $21.6          $22.4
Total current assets             $60.8          $58.6
All other assets, net             36.6           30.8
Total assets                     $97.4          $89.4
Total current liabilities        $11.5          $ 9.8
Total debt                         0.0            0.0
All other liabilities, net         5.6            4.2
Shareholders' equity              80.3           75.4
Total liabilities and
 shareholders' equity            $97.4          $89.4

                     COMPARATIVE SUMMARY OF INCOME
           (Unaudited, in Millions, Except Per-Share Data)

                               First Quarter           % Change
                            1995           1994      1995 vs. 1994

Sales                      $22.5          $20.9          + 8%
Gross profit                11.8           10.9          + 8%
Operating income             1.5            1.1          +30%
Income before taxes          1.6            1.2          +35%
Net taxes                    0.5            0.4          +25%
Net income                 $ 1.1          $ 0.8          +40%
Shares outstanding         8,434          8,145          + 4%
Net earnings per share  13 cents       10 cents          +30%

CONTACT: Circon Corp., Santa Barbara

R. Bruce Thompson, 805/685-5100