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Newport CEO Denies Stock-Sinking Rumor

March 28, 2001|Dow Jones

Newport Corp. Chief Executive Robert Deuster, responding to a rumor that a customer had canceled orders, said Tuesday that the company is making no changes to its first-quarter or full-year 2001 projections and has not seen any such cancellations.

Deuster was responding to a market rumor that led to a steep sell-off of Newport's stock in afternoon trading Tuesday.

Investors ran with a rumor that Corning Inc. had canceled orders with Irvine-based Newport, sending the stock down by as much as 18% in heavy trading.

But Deuster said that any potential reduction in orders by Corning were factored into the company's latest guidance, which was issued March 6.

Newport, which makes products used for assembling and testing fiber optics and semiconductors, expects first-quarter sales of $95 million to $100 million and earnings per share, excluding charges, about 230% to 240% above the 15 cents a share the company reported in the year-ago first quarter, according to its March 6 report. The company expects 2001 revenue of $400 million to $425 million and 2001 earnings of $1.45 to $1.60 a share before nonrecurring charges.

"The [Corning rumor] is related to a plant they are delaying opening in New Hampshire," Deuster said. "Clearly, that's old news and something we had factored into our guidance three weeks ago."

Newport officials said their relationship with Corning remains strong.

The stock rebounded a bit to close at $35.31, down $4.90 a share, or 12.2%, in Nasdaq trading.

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