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CIRCON ANNOUNCES FIRST QUARTER 1992 NET INCOME UP 207 PERCENT

 CIRCON ANNOUNCES FIRST QUARTER 1992 NET INCOME UP 207 PERCENT
 SANTA BARBARA, Calif., April 22 /PRNewswire/ -- Richard A. Auhll, president and chairman of Circon, today announced that first quarter 1992 results show that Circon (NASDAQ-NMS: CCON) continues its record-setting pace. Sales, gross profit, operating income, net income and EPS all set new Circon highs. Net income tripled and EPS more than doubled over last year.
 Circon's sales growth and profit improvement trends established over the past three years continue to be driven by the accelerating movement toward minimally invasive surgery. The gynecology and laparoscopy applications for Circon products are growing substantially.
 First quarter 1992 net income grew 207 percent to $1.6 million from $0.5 million in 1991. Earnings per share increased 120 percent to $0.20. The EPS increase was achieved even with the 40 percent addition to the outstanding shares as a result of the two 1991 public stock offerings. These equity offerings eliminated $16.0 million in debt and replaced it with a $25.0 million cash balance.
 Operating income increased 84 percent to $2.2 million. Operating income improved even though substantial investments were made in sales and marketing.
 Gross profit for the first quarter 1992 set a new Circon record by increasing to $11.2 million, up 38 percent from the $8.1 million of last year.
 Manufacturing efficiency continues to advance as evidenced by gross profit as a percentage of sales reaching 54.0 percent, compared to 51.6 percent and 50.1 percent for the comparable 1991 and 1990 periods.
 These significant increases in income were the result of sales growth, improved operating margins and expense control.
 U.S. sales had record growth of 40 percent in the first quarter. International sales are up 71 percent year-to-date. Circon's primary focus is sales of medical instrumentation through its U.S. sales force and international network.
 Sales to industrial, OEM and government customers are more "opportunistic," and are not an area of sales emphasis. This area now represents only about 6 percent of total sales.
 Thus, the company said it is particularly pleased that worldwide sales to our "primary medical market" are currently growing at an annualized rate of 45 percent. Total sales also set a new Circon high and are up 30 percent for the first quarter 1992.
 Economic pressures and patient demands are inducing surgeons to seek minimally invasive methods to replace traditional open surgery. Circon's basic areas of expertise in endoscope and video systems are key elements in the instrumentation for the emerging, minimally invasive surgical fields.
 Absolute expenditures for total operating expenses increased, however, as a percentage of sales, they dropped from 44 percent in first quarter 1991 to 43 percent in first quarter 1992.
 Selling, general and administrative expenses increased 36 percent primarily because of higher selling commissions and related expenses associated with higher sales. In total, operating expenses were held to a 28 percent increase, compared to a 30 percent increase in total sales.
 Circon's strong financial performance continues to be driven by the "mega-trend" toward minimally invasive surgery which is expected to continue throughout the decade.
 Circon's management believes that the company is well positioned in the right markets with all the technical, manufacturing, marketing and financial resources to benefit from this exciting opportunity.
 Circon develops, manufactures and markets endoscope systems and ultraminiature color video systems for medical and industrial applications and is the largest U.S. producer of medical endoscopes and video systems.
 CIRCON CORP.
 Comparative Summary of Income
 (In millions, except per share data)
 (Unaudited)
 First quarter First quarter Change
 1992 1991 92 vs. 91
 Sales $20.5 $15.8 +30 pct.
 Gross profit 11.1 8.1 +36 pct.
 Operating income 2.2 1.2 +84 pct.
 Income before taxes
 and extraordinary
 item 2.4 0.8 +210 pct.
 Net taxes 0.8 0.2 +216 pct.
 Net income $1.6 $0.5 +207 pct.
 Shares outstanding 8,286 5,921 +40 pct.
 Net earnings
 per share $0.20 $0.09 +120 pct.
 CIRCON CORP.
 First Quarter 1992
 Condensed Balance Sheet
 (In millions)
 (Unaudited)
 March 31, March 31,
 1992 1991
 Total current assets $56.7 $25.4
 All other assets, net 19.4 17.3
 Total assets $76.1 $42.7
 Short-term debt $0 $1.2
 Total current liabilities 8.4 8.9
 Long-term debt 0 14.3
 All other liabilities, net 0.7 ---
 Shareholders equity 67.0 19.5
 Total liabilities and
 shareholders equity $76.1 $42.7
 -0- 4/22/92
 /CONTACT: R. Bruce Thompson, executive VP and CFO of Circon, 805-967-0404/
 (CCON) CO: Circon Corp. ST: California IN: MTC SU: ERN


EH-DM -- LA015 -- 1081 04/22/92 09:13 EDT
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Date:Apr 22, 1992
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