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NEWPORT WILL TAKE ONE-TIME RESTRUCTURING CHARGE; EXPECTS LOSS FOR THIRD QUARTER AND FISCAL YEAR

 NEWPORT WILL TAKE ONE-TIME RESTRUCTURING CHARGE;
 EXPECTS LOSS FOR THIRD QUARTER AND FISCAL YEAR
 FOUNTAIN VALLEY, Calif., May 26 /PRNewswire/ -- Responding to continuing weakness in revenues in the United States and Europe, Newport Corp. (NASDAQ: NEWP) plans to implement a comprehensive program to restructure operations and substantially lower its cost structure. The actions follow Newport's acquisition in September 1991 of Micro- Controle, S.A., a French company based in Evry, France.
 While the company continues to evaluate the financial impact of these measures, it is expected that they will result in a one-time restructuring charge of approximately $19 million to $22 million to be taken in the third quarter ended April 30, 1992. In addition, Newport anticipates that goodwill related to the Micro-Controle acquisition will be increased by approximately $5 million to $10 million to reflect the effects of the restructuring on the carrying values assigned to net assets of Micro-Controle, S.A. as required by Generally Accepted Accounting Principles (GAAP).
 As a result of the restructuring charges and lower revenues, Newport expects to report a net loss for the third quarter of approximately $11 million to $13 million, equal to $1.60 to $1.80 per share, and a substantial loss for the full fiscal year ending July 31, 1992 as well. Newport had not reported a loss quarter in the 12 previous years of operations.
 In fiscal 1991, Newport reported third quarter net income of $963,000, equal to 14 cents per share, and for the full year, net income totaled $3,533,000, equal to 50 cents per share. Through the first half of the current fiscal year, the company had reported net income of $626,000, or 9 cents per share.
 Richard E. Schmidt, chairman and chief executive officer, said: "The restructuring program is directed at properly aligning our costs with anticipated revenues, improving our ability to serve our worldwide markets on a more efficient basis and returning the company to profitability at an early date. Revenues have been less than anticipated following the acquisition due to the persistence of the recession in the United States and Europe, plus weakness in our core laboratory market as a result of decreases in scientific research funding and defense budgets.
 "Total revenues for the third quarter approximated $24 million, 5 percent less than in this year's second quarter. The lower-than- anticipated revenue level resulted in a net loss for the quarter of approximately 12 cents to 17 cents per share, excluding the effect of the restructuring charges. In view of the present very difficult market conditions, we felt it was essential that management move vigorously to restore profitability.
 "Planned actions include cutting duplicative operations, workforce reductions, general spending cutbacks, and elimination of non-productive assets and certain marginal products and product lines. Management believes that these measures will provide some benefit to fourth quarter results and that the bulk of the program will be accomplished by Sept. 1, 1992.
 "While difficult and painful, our efforts should result in a much stronger corporation, with improved prospects. After the program's full implementation, we expect that costs and expenses will be reduced by more than $10 million annually. While working to become a leaner and more efficient company, we are also taking care to maintain, and strengthen, our ability to provide high quality products and service to our customers worldwide."
 Newport Corp. is a leading, worldwide manufacturer and marketer of precision laboratory equipment for scientists and engineers who develop and apply technology involving lasers and optics. The Micro-Controle acquisition further enhances Newport's precision positioning capabilities for high technology industries including semiconductor manufacturing, telecommunications and analytical instrumentation. Customers include Fortune 500 corporations, national research laboratories, government and educational institutions.
 -0- 5/26/92
 /CONTACT: Robert Hewitt, senior VP-finance, 714-965-5405/
 (NEWP) CO: Newport Corp. ST: California IN: CPR SU: RCN ERP


DM -- LA003 -- 3584 05/26/92 08:02 EDT
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Publication:PR Newswire
Date:May 26, 1992
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