19. Selected Consolidated Financial Data

Quarterly Financial Information (unaudited)

The Company’s interim financial statements are prepared on a quarterly basis ending on the Friday closest to the end of the calendar quarter, with the exception of the fourth quarter which always ends on December 31.

On January 15, 2013, the Company acquired NDS and started to include the operating results of NDS in the consolidated financial statements as of the acquisition date. In the second quarter of 2013, the Company consummated the sale of certain assets and liabilities of the Semiconductor Systems business for $8.0 million in cash, subject to closing working capital adjustments, and recorded a $0.3 million loss, net of tax. In September 2013, the Company settled final working capital adjustments on the sale of the Laser Systems business and the Semiconductor Systems business and recognized additional loss on disposal of businesses of $0.3 million, net of tax.

During the fourth quarter of 2012, based on an accumulation of positive evidence such as cumulative profits over the prior three years and projections for future growth, the Company determined that it is more likely than not that the benefits of our deferred tax assets will be realized. Accordingly, a deferred tax valuation allowance release of $15.3 million was recorded as an income tax benefit during the fourth quarter of 2012. In addition, the Company sold certain assets and liabilities of the Lasers Systems business for $7.0 million, subject to working capital adjustments, and recorded a $2.3 million gain on the sale.

The following tables reflect the Company’s unaudited condensed consolidated statements of operations (in thousands except per share data):


	Three Months Ended
	December 31, 2013			September 27, 2013			June 28, 2013			March 29, 2013
Sales	$	87,707		$	85,484		$	85,307		$	83,114
Cost of goods sold		51,711			49,693			50,808			49,951

Gross profit		35,996			35,791			34,499			33,163
Operating expenses		29,319			30,073			30,152			32,214

Income from operations		6,677			5,718			4,347			949
Interest income (expense) and other income (expense), net		(847	)		(1,936	)		(1,048	)		670

Income from continuing operations before income taxes		5,830			3,782			3,299			1,619
Income tax provision		1,463			1,610			2,457			150

Income from continuing operations		4,367			2,172			842			1,469
Income (loss) from discontinued operations, net of tax.		(79	)		(113	)		(1,384	)		649
Loss on disposal of discontinued operations, net of tax		—			(281	)		(311	)		—

Consolidated net income (loss)		4,288			1,778			(853	)		2,118
Net (income) loss attributable to noncontrolling interest		20			12			(18	)		(36	)

Net income (loss) attributable to GSI Group Inc	$	4,308		$	1,790		$	(871	)	$	2,082

Earnings from continuing operations per common share:
Basic	$	0.13		$	0.06		$	0.02		$	0.04
Diluted	$	0.13		$	0.06		$	0.02		$	0.04
Earnings (loss) from discontinued operations per common share:
Basic	$	—		$	(0.01	)	$	(0.05	)	$	0.02
Diluted	$	—		$	(0.01	)	$	(0.05	)	$	0.02
Net income (loss) per common share:
Basic	$	0.13		$	0.05		$	(0.03	)	$	0.06
Diluted	$	0.13		$	0.05		$	(0.03	)	$	0.06


	Three Months Ended
	December 31, 2012			September 28, 2012			June 29, 2012			March 30, 2012
Sales	$	66,413		$	69,520		$	70,379		$	65,186
Cost of goods sold		39,138			40,667			39,712			37,505

Gross profit		27,275			28,853			30,667			27,681
Operating expenses		23,978			25,061			25,570			24,860

Income from operations		3,297			3,792			5,097			2,821
Interest income (expense) and other income (expense), net		(772	)		(1,174	)		(13	)		(1,514	)

Income from continuing operations before income taxes		2,525			2,618			5,084			1,307
Income tax provision (benefit)		(12,350	)		563			617			230

Income from continuing operations		14,875			2,055			4,467			1,077
Income (loss) from discontinued operations, net of tax		(1,317	)		(4,570	)		414			322
Gain on disposal of discontinued operations, net of tax.		2,255			—			—			—

Consolidated net income (loss)		15,813			(2,515	)		4,881			1,399
Net (income) loss attributable to noncontrolling interest		5			(19	)		(8	)		(18	)

Net income (loss) attributable to GSI Group Inc	$	15,818		$	(2,534	)	$	4,873		$	1,381

Earnings from continuing operations per common share:
Basic	$	0.44		$	0.06		$	0.13		$	0.03
Diluted	$	0.44		$	0.06		$	0.13		$	0.03
Earnings (loss) from discontinued operations per common share:
Basic	$	0.03		$	(0.13	)	$	0.01		$	0.01
Diluted	$	0.03		$	(0.13	)	$	0.01		$	0.01
Net income (loss) per common share:
Basic	$	0.47		$	(0.07	)	$	0.14		$	0.04
Diluted	$	0.47		$	(0.07	)	$	0.14		$	0.04