SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
---------------------------------------
FORM 10-Q
(mark one)
[ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Quarter Ended December 28, 1996.
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
Commission File Number 1-10791
THERMOTREX CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 52-1711436
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10455 Pacific Center Court
San Diego, California 92121-4339
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 622-1000
Indicate by check mark whether the Registrant (1)
has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for
such shorter period that the Registrant was
required to file such reports), and (2) has been
subject to such filing requirements for the past
90 days. Yes [ X ] No [ ]
Indicate the number of shares outstanding of each
of the issuer's classes of Common Stock, as of the
latest practicable date.
Class Outstanding at January 24, 1997
---------------------------- -------------------------------
Common Stock, $.01 par value 19,199,656
PAGE
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PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
THERMOTREX CORPORATION
Consolidated Balance Sheet
(Unaudited)
Assets
December 28, September 28,
(In thousands) 1996 1996
------------------------------------------------------------------------
Current Assets:
Cash and cash equivalents $ 61,303 $ 43,940
Available-for-sale investments, at quoted
market value (amortized cost of $24,742
and $51,774) 24,706 51,701
Accounts receivable, less allowances of
$1,663 and $1,586 38,222 36,615
Unbilled contract costs and fees 3,830 2,933
Inventories:
Raw materials and supplies 25,726 22,046
Work in process 11,944 9,731
Finished goods 5,657 5,526
Prepaid expenses 1,817 2,157
Prepaid income taxes 11,199 9,685
-------- --------
184,404 184,334
-------- --------
Property, Plant and Equipment, at Cost 49,962 40,535
Less: Accumulated depreciation and
amortization 10,151 9,031
-------- --------
39,811 31,504
-------- --------
Notes Receivable from Related Party 3,300 3,300
-------- --------
Other Assets 4,725 4,680
-------- --------
Cost in Excess of Net Assets of Acquired
Companies 95,770 96,404
-------- --------
$328,010 $320,222
======== ========
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THERMOTREX CORPORATION
Consolidated Balance Sheet (continued)
(Unaudited)
Liabilities and Shareholders' Investment
December 28, September 28,
(In thousands except share amounts) 1996 1996
------------------------------------------------------------------------
Current Liabilities:
Note payable to parent company $ 2,000 $ 2,000
Accounts payable 18,826 19,569
Accrued payroll and employee benefits 6,522 7,228
Accrued warranty costs 5,798 5,379
Accrued income taxes 4,967 2,239
Customer deposits 3,585 3,582
Other accrued expenses 17,942 15,205
Due to parent company and affiliated
companies 1,029 1,269
-------- --------
60,669 56,471
-------- --------
Deferred Lease Liability 764 494
-------- --------
Common Stock Subject to Redemption (Note 2) 2,613 -
-------- --------
Minority Interest 58,379 58,178
-------- --------
Shareholders' Investment:
Common stock, $.01 par value,
50,000,000 shares authorized;
19,213,775 and 19,190,107
shares issued 192 192
Capital in excess of par value 114,122 116,753
Retained earnings 91,919 89,156
Treasury stock at cost, 17,193
and 25,508 shares (625) (975)
Net unrealized loss on
available-for-sale investments (23) (47)
-------- --------
205,585 205,079
-------- --------
$328,010 $320,222
======== ========
The accompanying notes are an integral part of these consolidated
financial statements.
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THERMOTREX CORPORATION
Consolidated Statement of Income
(Unaudited)
Three Months Ended
--------------------------
December 28, December 30,
(In thousands except per share amounts) 1996 1995
-----------------------------------------------------------------------
Revenues $62,826 $43,095
------- -------
Costs and Operating Expenses:
Cost of revenues 40,053 26,332
Selling, general and administrative expenses 14,864 10,247
Research and development expenses 7,370 4,799
------- -------
62,287 41,378
------- -------
Operating Income 539 1,717
Interest Income 1,279 1,360
Interest Expense, Related Party (30) (122)
Gain on Issuance of Stock by Subsidiary (Note 3) 1,997 12,770
------- -------
Income Before Provision for Income Taxes
and Minority Interest 3,785 15,725
Provision for Income Taxes 977 1,519
Minority Interest Expense 45 34
------- -------
Net Income $ 2,763 $14,172
======= =======
Earnings per Share $ .14 $ .72
======= =======
Weighted Average Shares 19,181 19,646
======= =======
The accompanying notes are an integral part of these consolidated
financial statements.
4PAGE
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THERMOTREX CORPORATION
Consolidated Statement of Cash Flows
(Unaudited)
Three Months Ended
--------------------------
December 28, December 30,
(In thousands) 1996 1995
------------------------------------------------------------------------
Operating Activities:
Net income $ 2,763 $ 14,172
Adjustments to reconcile net income to
net cash provided by (used in) operating
activities:
Depreciation and amortization 1,842 1,053
Provision for losses on accounts
receivable 156 104
Gain on issuance of stock by
subsidiary (Note 3) (1,997) (12,770)
Minority interest expense 45 34
Changes in current accounts:
Accounts receivable (1,763) (1,077)
Inventories and unbilled contract
costs and fees (6,921) (164)
Other current assets (1,187) (789)
Accounts payable (743) (1,462)
Other current liabilities 5,211 2,299
-------- --------
Net cash provided by (used in) operating
activities (2,594) 1,400
-------- --------
Investing Activities:
Purchases of available-for-sale investments - (24,500)
Proceeds from sale and maturities of available-
for-sale investments 26,500 22,500
Purchases of property, plant and equipment (9,530) (1,713)
Other 510 419
-------- --------
Net cash provided by (used in) investing
activities 17,480 (3,294)
-------- --------
Financing Activities:
Net proceeds from issuance of Company
and subsidiary common stock and sale
of subsidiary put options (Notes 2 and 3) 5,179 18,027
Purchases of subsidiary common stock (2,179) -
Payment of withholding taxes related to
stock option exercises (523) (100)
-------- --------
Net cash provided by financing activities 2,477 17,927
-------- --------
Increase in Cash and Cash Equivalents 17,363 16,033
Cash and Cash Equivalents at Beginning of Period 43,940 21,512
-------- --------
Cash and Cash Equivalents at End of Period $ 61,303 $ 37,545
======== ========
The accompanying notes are an integral part of these consolidated
financial statements.
5PAGE
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THERMOTREX CORPORATION
Notes to Consolidated Financial Statements
1. General
The interim consolidated financial statements presented have been
prepared by ThermoTrex Corporation (the Company) without audit and, in
the opinion of management, reflect all adjustments of a normal recurring
nature necessary for a fair statement of the financial position at
December 28, 1996, the results of operations for the three-month periods
ended December 28, 1996 and December 30, 1995, and the cash flows for the
three-month periods ended December 28, 1996 and December 30, 1995.
Interim results are not necessarily indicative of results for a full
year.
The consolidated balance sheet presented as of September 28, 1996,
has been derived from the consolidated financial statements that have
been audited by the Company's independent public accountants. The
consolidated financial statements and notes are presented as permitted by
Form 10-Q and do not contain certain information included in the annual
financial statements and notes of the Company. The consolidated financial
statements and notes included herein should be read in conjunction with
the financial statements and notes included in the Company's Annual
Report on Form 10-K for the fiscal year ended September 28, 1996, filed
with the Securities and Exchange Commission.
2. Common Stock Subject to Redemption
In September 1996, ThermoLase's Board of Directors authorized the
repurchase by ThermoLase of up to $10,000,000 of its common stock through
August 28, 1997, in market transactions or pursuant to the exercise by
investors of standardized put options written on its common stock. During
the first quarter of fiscal 1997, ThermoLase repurchased 137,500 shares
of its common stock in market transactions for $2.2 million. As of
December 28, 1996, ThermoLase had contingent obligations under
outstanding put options, which are exercisable only on April 18, 1997,
and expire on such date, to repurchase up to 145,800 shares of its common
stock at various prices for an aggregate price of $2.6 million, which has
been reclassified to "Common stock subject to redemption" in the
accompanying balance sheet.
3. Issuance of Stock by Subsidiary
In December 1996, Trex Medical issued 300,000 shares of its common
stock at $14.50 per share in a private placement for net proceeds of $4.1
million, resulting in a gain of $2.0 million. At December 28, 1996, the
Company owned 79% of the outstanding common stock of Trex Medical.
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THERMOTREX CORPORATION
Item 2 - Management's Discussion and Analysis of Financial Condition and
Results of Operations
Forward-looking statements, within the meaning of Section 21E of the
Securities Exchange Act of 1934, are made throughout this Management's
Discussion and Analysis of Financial Condition and Results of Operations.
For this purpose, any statements contained herein that are not statements
of historical fact may be deemed to be forward-looking statements.
Without limiting the foregoing, the words "believes," "anticipates,"
"plans," "expects," "seeks," "estimates," and similar expressions are
intended to identify forward-looking statements. There are a number of
important factors that could cause the results of the Company to differ
materially from those indicated by such forward-looking statements,
including those detailed under the caption "Forward-looking Statements"
in Exhibit 13 to the Company's Annual Report on Form 10-K for the fiscal
year ended September 28, 1996, filed with the Securities and Exchange
Commission.
Overview
The Company operates in three business segments: Medical Products
manufactured by the Company's 79%-owned Trex Medical Corporation (Trex
Medical) subsidiary, Personal-care Products and Services offered by the
Company's 64%-owned ThermoLase Corporation (ThermoLase) subsidiary, and
Advanced Technology Research.
Trex Medical designs, manufactures, and markets mammography equipment
and minimally invasive stereotactic breast-biopsy systems, general
radiography (X-ray) equipment, and X-ray imaging systems used for cardiac
catheterization and angiography, as well as radiographic/fluoroscopic
procedures. Trex Medical sells its systems worldwide principally through
a network of independent dealers, and also acts as an original equipment
manufacturer (OEM) for other medical equipment companies. Trex Medical
has four operating units: Lorad, a manufacturer of mammography and
stereotactic breast-biopsy systems; Bennett X-Ray Corporation (Bennett),
a manufacturer of general X-ray and mammography equipment; XRE
Corporation (XRE), a manufacturer of X-ray imaging systems used in the
diagnosis and treatment of coronary artery disease and other vascular
conditions; and Continental X-Ray Corporation (Continental), a
manufacturer of general-purpose and specialized X-ray systems.
ThermoLase has developed a laser-based system called SoftLight(SM)
for the removal of unwanted hair. The SoftLight system uses a low-energy,
dermatology laser in combination with a lotion that absorbs the laser's
energy to disable hair follicles. In April 1995, the Company received
clearance from the U.S. Food and Drug Administration (FDA) to
commercially market services using the SoftLight system. The Company
began earning revenue from the SoftLight system in the first quarter of
fiscal 1996 as a result of opening its first commercial salon (Spa Thira)
in La Jolla, California, in November 1995. ThermoLase opened additional
salons in Dallas in June 1996 and in Houston and Beverly Hills in
September 1996. During the first quarter of fiscal 1997, ThermoLase
7PAGE
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THERMOTREX CORPORATION
Overview (continued)
opened three new salons: in Denver in October 1996, in Boca Raton in
November 1996, and in suburban Detroit in December 1996. ThermoLase also
opened a spa in suburban Minneapolis in January 1997, and plans to open
salons in Greenwich, Connecticut, and Manhasset, New York in February
1997. In addition, ThermoLase has signed leases for two additional sites:
in Palm Beach, Florida, and Newport Beach, California. In June 1996,
ThermoLase commenced a program to license to doctors and others the right
to perform the Company's patented SoftLight hair-removal procedure. In
this program, ThermoLase licenses its technology and receives a one-time
fee and a per-procedure royalty that varies depending on the location
treated. ThermoLase also provides the licensees with the lasers and
lotion that are necessary to perform the service. ThermoLase is marketing
the SoftLight system internationally through joint ventures and other
licensing arrangements, including separate joint ventures established in
Japan in January 1996 and in France in November 1996, a licensing
arrangement established in Saudi Arabia in November 1996, and a licensing
arrangement established in Tunisia and Belgium on December 31, 1996.
ThermoLase also manufactures and markets skin-care, bath, and body
products through its CBI Laboratories, Inc. (CBI) subsidiary, which also
manufactures the lotion used in the SoftLight hair-removal process.
The Company's Advanced Technology Research segment performs research
primarily in the fields of communications, avionics, X-ray detection,
signal processing, advanced-materials technology, and lasers. The Company
has developed its expertise in these core technologies in connection with
government-sponsored research and development.
Results of Operations
First Quarter Fiscal 1997 Compared With First Quarter Fiscal 1996
Total revenues increased 46% to $62.8 million in the first quarter of
fiscal 1997 from $43.1 million in fiscal 1996. Medical Products segment
revenues, excluding intersegment sales, increased 59% to $51.0 million in
fiscal 1997, compared with $32.2 million in fiscal 1996, primarily due to
the inclusion of $16.5 million in revenues from Continental, acquired in
September 1996, and XRE, acquired in May 1996. In addition, revenues at
Lorad, excluding intersegment sales, increased 10% as a result of
increased demand for mammography and biopsy systems. Lorad's revenues in
fiscal 1997 include $10.1 million in sales under an OEM agreement with
U.S. Surgical Corporation, compared with $1.1 million in fiscal 1996.
Personal-care Products and Services segment revenues increased 16% to
$8.6 million in the first quarter of fiscal 1997 from $7.4 million in the
first quarter of fiscal 1996. ThermoLase, which opened three additional
spas during the quarter, for a total of seven Spa Thira salons, earned
revenues of $1.5 million in fiscal 1997, compared with $0.1 million in
fiscal 1996 from the November opening of its first spa. Under the current
pricing structure, the majority of spa clients pay a fixed fee in advance
8PAGE
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THERMOTREX CORPORATION
First Quarter Fiscal 1997 Compared With First Quarter Fiscal 1996
(continued)
to receive a series of treatments, as necessary. Consequently, ThermoLase
defers revenue related to such payments, which is recognized over the
anticipated treatment period. As ThermoLase collects further data
concerning the number of treatments required and duration of the
treatment period, the period of revenue recognition may be affected. In
addition, ThermoLase's revenues in fiscal 1997 include $0.8 million in
SoftLight licensing fees from its licensing program with 70 physicians
and $0.3 million in international licensing fees. No SoftLight licensing
fees were earned in the first quarter of fiscal 1996. Revenues at CBI
decreased to $6.0 million in fiscal 1997 from $7.3 million in fiscal
1996, primarily due to an unusually large order shipped to a single
customer in the first quarter of fiscal 1996. ThermoLase estimates that
CBI will continue to represent a smaller portion of its total revenues as
revenues from hair-removal services increase.
Advanced Technology Research segment revenues, excluding intersegment
sales, decreased to $3.2 million in the first quarter of fiscal 1997 from
$3.5 million in the first quarter of fiscal 1996. The Company estimates
that revenues from Advanced Technology Research will continue to decline
as a percentage of total revenues.
The gross profit margin was 36% in the first quarter of fiscal 1997,
compared with 39% in the first quarter of fiscal 1996. The Medical
Products segment gross profit margin, excluding intersegment sales,
declined to 39% in the first quarter of fiscal 1997 from 44% in the first
quarter of fiscal 1996, primarily due to the inclusion of lower-margin
revenues at Continental and the mix of products sold at Lorad. The
Personal-care Products and Services segment gross profit margin declined
to 21% in the first quarter of fiscal 1997 from 30% in the first quarter
of fiscal 1996. The decline was primarily due to the early operations of
the Spa Thira business, which has been operating below maximum capacity
as ThermoLase develops a client base and continues refining its operating
procedures, and due to pre-opening costs incurred in connection with new
spa openings. This decrease was offset in part by the effect of SoftLight
licensing fees, which have a relatively high gross profit margin. As
ThermoLase opens additional Spa Thira locations in fiscal 1997, higher
gross profit margins from the more mature spas will be more than offset
by lower margins from the relatively large number of newly opened spas,
each of which operates below maximum capacity as it develops its client
base. In addition, gross profit margins will be depressed by higher
pre-opening costs. ThermoLase's decline in gross profit margin in the
first quarter of fiscal 1997 also resulted from slightly lower margins on
the sale of skin-care and other personal-care products at CBI due to a
shift to lower-margin products.
9PAGE
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THERMOTREX CORPORATION
First Quarter Fiscal 1997 Compared With First Quarter Fiscal 1996
(continued)
Selling, general, and administrative expenses as a percentage of
revenues was 24% in both periods. An increase in spending in the
Personal-care Products and Services segment was offset by a decrease in
expenses as a percentage of revenues in the Medical Products segment,
primarily due to an increase in revenues.
Research and development expenses increased to $7.4 million in the
first quarter of fiscal 1997 from $4.8 million in the first quarter of
fiscal 1996, due to the inclusion of $1.7 million of expense at XRE and
Continental, continued efforts to develop and commercialize new products,
including the full-breast digital mammography system and direct-detection
X-ray sensor, and, to a lesser extent, spending at ThermoLase for
pre-clinical and clinical research related to improving the effectiveness
of its hair-removal process and developing its skin-rejuvenation process,
and the investigation of other health and beauty applications for its
proprietary laser technology.
Interest income was relatively unchanged at $1.3 million in the first
quarter of fiscal 1997, compared with $1.4 million in the first quarter
of fiscal 1996. Interest expense decreased in the first quarter of fiscal
1997 compared with the first quarter of fiscal 1996 due to the September
1996 repayment of the $8.0 million promissory note issued to Thermo
Electron Corporation (Thermo Electron) in September 1995, offset in part
by interest expense associated with the $2.0 million promissory note
issued on similar terms to Thermo Electron in September 1996.
During the first quarter of fiscal 1997 and fiscal 1996, the Company
recorded gains of $2.0 million and $12.8 million, respectively, from the
issuance of stock by subsidiary in connection with private placements of
Trex Medical common stock.
Minority interest expense in both periods represents minority
shareholders' allocable share of Trex Medical's net income, offset in
part by minority shareholders' allocable share of ThermoLase's net loss.
The effective tax rate in each period differs from the statutory
federal income tax rate due to the nontaxable gains on issuance of stock
by subsidiary, offset in part by nondeductible amortization of cost in
excess of net assets of acquired companies and the impact of state income
taxes.
Liquidity and Capital Resources
Consolidated working capital was $123.7 million at December 28, 1996,
compared with $127.9 million at September 28, 1996. Included in working
capital are cash, cash equivalents, and available-for-sale investments of
$86.0 million at December 28, 1996, compared with $95.6 million at
September 28, 1996. Of the $86.0 million balance at December 28, 1996,
$39.4 million was held by ThermoLase, $38.2 million was held by Trex
10PAGE
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THERMOTREX CORPORATION
Liquidity and Capital Resources (continued)
Medical, and the remainder was held by the Company and its wholly owned
subsidiaries. Net cash used in operating activities during the first
quarter of fiscal 1997 was $2.6 million. During this period, $6.9 million
of cash was used to fund an increase in inventories and unbilled contract
costs and fees. The increase primarily represents materials requirements
at Trex Medical for commitments under an OEM agreement, to be shipped
during the remainder of fiscal 1997, and higher inventory levels in
support of Trex Medical's increase in sales. This use of cash was offset
in part by $5.2 million provided by an increase in other current
liabilities, including $2.7 million from accrued income taxes. The
Company expended $9.5 million for property, plant, and equipment during
the first quarter of fiscal 1997, and the Company's financing activities
provided cash of $2.5 million.
In September 1996, ThermoLase's Board of Directors authorized the
repurchase by ThermoLase of up to $10.0 million of its common stock
through August 28, 1997, in market transactions or pursuant to the
exercise by investors of standardized put options written on its common
stock. During the first quarter of fiscal 1997, ThermoLase repurchased
137,500 shares of its common stock in market transactions for $2.2
million. As of December 28, 1996, ThermoLase had contingent obligations
under outstanding put options, which are exercisable only on April 18,
1997, to repurchase up to 145,800 shares of its common stock for $2.6
million (Note 2).
In November 1996, ThermoLase entered into a joint venture agreement
to market its SoftLight system in France, as well as its laser-based
skin-rejuvenation process, if and when available. In January 1997,
ThermoLase contributed $1,027,000 to the joint venture, and has committed
to provide up to an additional $4,000,000 to fund its working capital
requirements, in exchange for ThermoLase's 50% stake in the joint
venture.
In January 1997, ThermoLase filed with the Securities and Exchange
Commission a registration statement related to its intention to offer its
shareholders the opportunity to exchange one share of existing ThermoLase
common stock and $3.00 for a new unit consisting of one share of
ThermoLase common stock and one redemption right. The redemption right
would entitle the holder to sell the related share of common stock to
ThermoLase for $20.25 during the first 20 business days after the fourth
anniversary of the closing of the exchange offer. The redemption right
would expire and become worthless if the closing price of ThermoLase
common stock has been at least $26.00 for 20 of any 30 consecutive
trading days following the expiration of the exchange offer. If more than
2,000,000 shares of ThermoLase common stock are tendered in the exchange
offer, acceptances would be reduced pro rata. The exchange offer would be
subject to several conditions, including the effectiveness of the
registration statement, listing of the new units by the American Stock
Exchange, and acceptance of the offer by the holders of at least 500,000
shares of ThermoLase common stock.
11PAGE
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THERMOTREX CORPORATION
Liquidity and Capital Resources (continued)
In addition to the suburban Minneapolis, Greenwich, Connecticut, and
Manhasset, New York spas that were under construction as of December 28,
1996, ThermoLase has signed leases in Palm Beach, Florida, and Newport
Beach, California, where it plans to open additional Spa Thiras. In
total, ThermoLase plans to open between 10 and 20 spas in various parts
of the United States during fiscal 1997. Depending on the size of the
spa, each facility will require approximately $1.5 million to $2.5
million for such items as leasehold improvements and laser systems. In
addition, ThermoLase expects to expend between $6.0 million and $8.0
million during fiscal 1997 for equipment related to its SoftLight
licensing programs. Accordingly, ThermoLase's capital expenditures will
largely be affected by the number of Spa Thira locations that can be
developed and the number of doctors engaged in the licensing program. The
Company expects that it will finance growth at its publicly held and
wholly owned subsidiaries through a combination of internal funds,
additional debt or equity financing, and/or short-term borrowings from
Thermo Electron, although it has no agreement to ensure that funds will
be available from Thermo Electron on acceptable terms or at all.
PART II - OTHER INFORMATION
Item 6 - Exhibits
See Exhibit Index on the page immediately preceding exhibits.
12PAGE
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THERMOTREX CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized as of the 5th day of February
1997.
THERMOTREX CORPORATION
Paul F. Kelleher
--------------------
Paul F. Kelleher
Chief Accounting Officer
John N. Hatsopoulos
--------------------
John N. Hatsopoulos
Vice President and
Chief Financial Officer
13PAGE
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THERMOTREX CORPORATION
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
------------------------------------------------------------------------
11 Statement re: Computation of earnings per share.
27 Financial Data Schedule.
Exhibit 11
THERMOTREX CORPORATION
Computation of Earnings per Share
Three Months Ended
---------------------------
December 28, December 30,
1996 1995
--------------------------------------------------------------------------
Computation of Primary
Earnings per Share:
Net Income (a) $ 2,763,000 $14,172,000
----------- -----------
Shares:
Weighted average shares
outstanding 19,180,949 19,037,141
Add: Shares issuable from
assumed exercise of
options (as determined
by the application of
the treasury stock
method) - 609,086
----------- -----------
Weighted average shares
outstanding, as
adjusted (b) 19,180,949 19,646,227
----------- -----------
Primary Earnings per
Share (a) / (b) $ .14 $ .72
=========== ===========
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THERMOTREX
CORPORATION'S QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED DECEMBER 28,
1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-27-1997
<PERIOD-END> DEC-28-1996
<CASH> 61,303
<SECURITIES> 24,706
<RECEIVABLES> 39,885
<ALLOWANCES> 1,663
<INVENTORY> 43,327
<CURRENT-ASSETS> 184,404
<PP&E> 49,962
<DEPRECIATION> 10,151
<TOTAL-ASSETS> 328,010
<CURRENT-LIABILITIES> 60,669
<BONDS> 0
0
0
<COMMON> 192
<OTHER-SE> 205,393
<TOTAL-LIABILITY-AND-EQUITY> 328,010
<SALES> 62,826
<TOTAL-REVENUES> 62,826
<CGS> 40,053
<TOTAL-COSTS> 40,053
<OTHER-EXPENSES> 7,370
<LOSS-PROVISION> 156
<INTEREST-EXPENSE> 30
<INCOME-PRETAX> 3,740
<INCOME-TAX> 977
<INCOME-CONTINUING> 2,763
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,763
<EPS-PRIMARY> .14
<EPS-DILUTED> 0
</TABLE>
