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"Macro-economic conditions continue to negatively impact consumerconfidence and discretionary spending, leading to continued softness inLasikPlus(R) appointments by prospective patients and disappointing showrates," said Steven C. Straus, Chief Executive Officer of LCA-Vision. "We alsobelieve that media coverage leading up to and following the April 25, 2008Food and Drug Administration Ophthalmic Devices Panel negatively impacted ourbusiness in May and June. Our total procedure volume for the second quarter of2008 is expected to be down approximately 40% compared with the second quarterof 2007.
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"On the positive side, IntraLase(R) is available in 73 of our 76LasikPlus(R) vision centers and month-to-date is being utilized in about 69%of our procedures, up from 55% in March," Mr. Straus said. "We continue toexpand our market presence, and have plans to open our 77th and 78thLasikPlus(R) vision centers during the third quarter, which will bring our2008 new center openings to six. We also plan to relocate three or four olderlocations by the end of this year. We are committed to success at eachLasikPlus(R) vision center and have no plans at this time to close anyfacility.
"Our management team has been working collaboratively with constituentsthroughout the company and our external business partners to make the bestdecisions in each market, and we are implementing initiatives at the centerlevel to optimize our performance," said Mr. Straus. "Some of theseinitiatives include:
-- Implementing simplified market-specific pricing for the first timebased on testing conducted over the past four months in multiple LasikPlus(R)markets.
-- Completing our well-received employee sales and conversioneffectiveness training at all LasikPlus(R) vision centers by the end of thismonth.
-- Modifying our center-level incentive compensation plans to furtheralign our center-level teams with our growth objectives.
-- Taking measures to manage our expense structure, including more closelyaligning our staffing with expected procedure volume and our national andlocal media spend with the current consumer sentiment.
"We remain committed to our strategic and operating plans, which are builtupon positive patient experiences, quality clinical outcomes, advancedtechnology, thoughtful expansion, and prudent revenue and expense management,"added Mr. Straus.
According to Anthony Woods, LCA-Vision's Chairman, "The LCA-Vision Boardof Directors strongly supports the executive management team in affirming thestrategic direction of the company. We are committed to our business model andour strategy. Consumers are confronted with record-high gasoline prices,increasing food costs and declining home values in the face of a softeningeconomy and growing job uncertainty. Many Americans are reining in theirexpenses, and are deferring or eliminating purchases that just one year agothey viewed differently. In this environment, there is no quick fix torestoring growth in procedure volume, but rather, we will focus on provenstrategies, while we prudently explore new opportunities to maximizeeffectiveness throughout our organization. As Steve mentioned, we are taking amore grassroots approach to operations, with the knowledge that all healthcareis delivered locally, and that success will be achieved on a market-by-marketbasis in partnership with our LasikPlus(R) surgeons and vision center teams."
Forward-Looking Statements
This news release contains forward-looking statements based on currentexpectations, forecasts and assumptions of LCA-Vision that are subject torisks and uncertainties.
