PARIS, July 26 2001 (PRIMEZONE) -- ESSILOR INTERNATIONAL (Paris Stock Exchange:EF)
in EUR Millions June 30,2001 June 30,2000 % change Sales 1,045.3 978.2 6.9% Operating income 152.3* 137.4* 11% Pretax income 116.0 112.1 3% Net income (after minority interests) 68.6 69.4 - Earnings per share E 6.91 E 6.57 5.2%
* Costs related to VisionWeb are recorded in non-operating expense, as was the case at December 31, 2000.
Sales rose 6.9% to E 1,045.3 million in the six months ended June 30, 2001. Excluding a 2.5% currency effect, growth on a like-for-like basis was 4.7%. Changes in the scope of consolidation had no significant impact, as the sale of the contact lens business in early 2001 was offset by the first-time consolidation of US prescription laboratories acquired in 2000. Sales by region broke down as 43% in Europe, 47% in North America and 10% in the Rest of the World.
High value-added products, in particular the Airwear(R) polycarbonate lens, the Varilux(R) Panamic(R) progressive lens and the Crizal(R) lens, increased their percentage of the revenue base, enabling the Group to outpace market growth in all regions, notably in the United States.
The Group's focus on high value-added products, the substantial improvement in margins at the US prescription laboratories, and the good performance of the Nikon-Essilor joint venture, lead to the 11% growth of the operating income, which represents 14.6% of sales from 14% at June 30, 2000.
The well-balanced regional distribution of the earnings stream attests to the Group's global scope, which allows it to effectively manage local risks and to respond to the global economic slowdown, even though it already enjoys below-average exposure to the business cycle.
After taking into account E 24 million in interest expense, which mainly increased following the buyback of 7% of outstanding Essilor shares in November 2000, E 12.3 million in non-operating expense, including development costs related to VisionWeb, and a 32% income tax rate, net income for the period contracted slightly to E 68.6 million, from E 69.4 million at June 30, 2000.
However, the March cancellation of 6% of outstanding Essilor shares following the buyback increased earnings per share 5.2% to E 6.91.
An exchange offer, which continues through August 3, allows holders of preferred non-voting Essilor shares to convert their preferred shares into ordinary shares on a one-for-one basis, while benefiting from a tax deferral on the resulting capital gain. Preferred shares not tendered to the offer will be redeemed by Essilor in late August for a cash payment of E 330 per share, with any capital gain taxed as income.
In September, once the preferred share exchange has been completed, Essilor will carry out its previously announced ten-for-one stock split.