##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended December 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from            to
 Commission File Number 000-06516
 
 DATASCOPE CORP.
 
  Delaware
    
    13-2529596(State of other jurisdiction of incorporation or 
organization)
    
    (I.R.S. Employer Identification No.)14 Philips Parkway, Montvale, New Jersey
    
    07645-9998(Address of principal executive offices)
    
    (Zip Code)
  
  
  þ o
  o þ o
 YES
o      
NO þ




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##### 



PagePART I. FINANCIAL INFORMATIONItem 1.
    
    Financial StatementsCondensed Consolidated Balance Sheets (Unaudited) at
December 31, 2006 and June 30, 2006
    
    
    1Condensed Consolidated Statements of Earnings (Unaudited)
Three and Six Months Ended December 31, 2006 and 2005
    
    
    2Condensed Consolidated Statements of Cash Flows (Unaudited)
Six Months Ended December 31, 2006 and 2005
    
    
    3Notes to Condensed Consolidated Financial Statements (Unaudited)
    
    
    4-17Item 2.
    
    Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    18-29Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    29Item 4.
    
    Controls and Procedures
    
    
    30PART II. OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    31Item 2.
    
    Changes in Securities, Use of Proceeds and Issuer Purchases of Equity
Securities
    
    
    31Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    32Item 5.
    
    Other Information
    
    
    32Item 6.
    
    Exhibits
    
    
    32Signatures
    
    
    33EX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATION




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 Datascope Corp. and Subsidiaries
 
 Condensed Consolidated Balance Sheets
  December 31,
    
    
    June 30,2006
    
    
    2006(Unaudited)
    
    
    (a)AssetsCurrent assets:Cash and cash equivalents
    
    $
    10,470
    
    
    $
    9,479Short-term investments
    
    
    30,986
    
    
    
    43,147Accounts receivable less allowance for
doubtful accounts of $2,425 and $2,301
    
    
    76,345
    
    
    
    78,133Inventories
    
    
    60,858
    
    
    
    58,759Prepaid income taxes
    
    
    2,091
    
    
    
    3,233Prepaid expenses and other current assets
    
    
    15,342
    
    
    
    13,907Current deferred taxes
    
    
    6,652
    
    
    
    6,522Total current assets
    
    
    202,744
    
    
    
    213,180Property, plant and equipment, net of accumulated
depreciation of $95,171 and $90,928
    
    
    83,427
    
    
    
    85,460Long-term investments
    
    
    22,572
    
    
    
    22,297Intangible assets, net
    
    
    20,152
    
    
    
    20,465Goodwill
    
    
    4,065
    
    
    
    4,065Other assets
    
    
    32,389
    
    
    
    30,213$
    365,349
    
    
    $
    375,680Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    19,005
    
    
    $
    20,071Dividends payable
    
    
    1,524
    
    
    
    1,069Accrued expenses
    
    
    16,606
    
    
    
    14,584Accrued compensation
    
    
    12,959
    
    
    
    16,234Deferred revenue
    
    
    3,450
    
    
    
    3,675Total current liabilities
    
    
    53,544
    
    
    
    55,633Other liabilities
    
    
    27,035
    
    
    
    26,309Commitments and contingencies (Note 10)Stockholders equity:Preferred stock, par value $1.00 per share:Authorized 5,000 shares; Issued, none
    
    
    
    
    
    
    Common stock, par value $0.01 per share:Authorized, 45,000 shares;Issued, 18,762 and 18,721 shares
    
    
    188
    
    
    
    187Additional paid-in capital
    
    
    105,234
    
    
    
    103,728Treasury stock at cost, 3,521 and 3,465 shares
    
    
    (107,037
    )
    
    
    (105,319
    )Retained earnings
    
    
    289,303
    
    
    
    299,255Accumulated other comprehensive loss:Cumulative translation adjustments
    
    
    (332
    )
    
    
    (1,300
    )Minimum pension liability adjustments
    
    
    (2,437
    )
    
    
    (2,437
    )Unrealized loss on available-for-sale securities
    
    
    (149
    )
    
    
    (376
    )Total stockholders equity
    
    
    284,770
    
    
    
    293,738$
    365,349
    
    
    $
    375,680
 
 1




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##### Table of Contents



Datascope Corp. and Subsidiaries
 
 Condensed Consolidated Statements of Earnings
 
 Six Months Ended
    
    
    Three Months EndedDecember 31,
    
    
    December 31,2006
    
    
    2005
    
    
    2006
    
    
    2005Net sales
    
    $
    182,800
    
    
    $
    180,800
    
    
    $
    95,600
    
    
    $
    92,500Cost of sales
    
    
    80,411
    
    
    
    80,110
    
    
    
    43,069
    
    
    
    42,490Gross profit
    
    
    102,389
    
    
    
    100,690
    
    
    
    52,531
    
    
    
    50,010Operating expenses:Research and development
expenses
    
    
    17,197
    
    
    
    18,146
    
    
    
    8,543
    
    
    
    9,381Selling, general and
administrative expenses
    
    
    69,930
    
    
    
    68,947
    
    
    
    34,866
    
    
    
    34,655Special items
    
    
    7,309
    
    
    
    (810
    )
    
    
    7,309
    
    
    
    94,436
    
    
    
    86,283
    
    
    
    50,718
    
    
    
    44,036Operating earnings
    
    
    7,953
    
    
    
    14,407
    
    
    
    1,813
    
    
    
    5,974Other (income) expense:Interest income
    
    
    (1,341
    )
    
    
    (1,093
    )
    
    
    (613
    )
    
    
    (548
    )Interest expense
    
    
    65
    
    
    
    93
    
    
    
    36
    
    
    
    35Dividend income
    
    
    (196
    )
    
    
    
    
    
    
    (196
    )
    
    
    Gain on sale of investment
    
    
    (1,273
    )
    
    
    
    
    
    
    (1,273
    )
    
    
    Other, net
    
    
    224
    
    
    
    1,071
    
    
    
    131
    
    
    
    402(2,521
    )
    
    
    71
    
    
    
    (1,915
    )
    
    
    (111
    )Earnings before income taxes
    
    
    10,474
    
    
    
    14,336
    
    
    
    3,728
    
    
    
    6,085Income taxes
    
    
    2,606
    
    
    
    3,829
    
    
    
    393
    
    
    
    1,634Net earnings
    
    $
    7,868
    
    
    $
    10,507
    
    
    $
    3,335
    
    
    $
    4,451Earnings per share, basic
    
    $
    0.52
    
    
    $
    0.71
    
    
    $
    0.22
    
    
    $
    0.30Weighted average number of common
shares outstanding, basic
    
    
    15,213
    
    
    
    14,816
    
    
    
    15,205
    
    
    
    14,834Earnings per share, diluted
    
    $
    0.51
    
    
    $
    0.69
    
    
    $
    0.22
    
    
    $
    0.29Weighted average number of common
shares outstanding, diluted
    
    
    15,472
    
    
    
    15,140
    
    
    
    15,488
    
    
    
    15,162
  2




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##### Table of Contents



Datascope Corp. and Subsidiaries
 
 Condensed Consolidated Statements of Cash Flows
 
 Six Months EndedDecember 31,2006
    
    
    2005Operating Activities:Net Earnings
    
    $
    7,868
    
    
    $
    10,507Adjustments to reconcile net earnings to net
cash provided by operating activities:Depreciation
    
    
    7,602
    
    
    
    7,642Amortization
    
    
    2,936
    
    
    
    2,574Provision for supplemental pension
    
    
    642
    
    
    
    604Provision for losses on accounts receivable
    
    
    184
    
    
    
    363Cash surrender value of officers life insurance
    
    
    (192
    )
    
    
    (192
    )Gain on sale of realty
    
    
    
    
    
    
    (810
    )Realized (gain) loss on sale of investments
    
    
    (1,273
    )
    
    
    853Stock-based compensation expense
    
    
    360
    
    
    
    88Excess tax benefits from stock-based compensation
    
    
    (93
    )
    
    
    (178
    )Deferred income tax (benefit)
    
    
    493
    
    
    
    (785
    )Special charges asset write-offs
    
    
    365
    
    
    
    1,614Changes in assets and liabilities:Accounts receivable
    
    
    2,348
    
    
    
    (2,867
    )Inventories
    
    
    (4,345
    )
    
    
    (6,520
    )Prepaid expenses and other assets
    
    
    413
    
    
    
    3,497Accounts payable
    
    
    (1,188
    )
    
    
    (401
    )Income taxes payable
    
    
    
    
    
    
    882Accrued and other liabilities
    
    
    (2,159
    )
    
    
    (4,182
    )Net cash provided by operating activities
    
    
    13,961
    
    
    
    12,689Investing Activities:Capital expenditures
    
    
    (2,673
    )
    
    
    (2,830
    )Proceeds from asset sales
    
    
    
    
    
    
    1,155Purchases of investments
    
    
    (52,221
    )
    
    
    (29,353
    )Proceeds from investment maturities
    
    
    47,237
    
    
    
    1,324Proceeds from investment sales
    
    
    17,766
    
    
    
    28,065Capitalized software
    
    
    (4,005
    )
    
    
    (1,898
    )Purchased technology and licenses
    
    
    (109
    )
    
    
    (196
    )Net cash provided by (used in) investing activities
    
    
    5,995
    
    
    
    (3,733
    )Financing Activities:Repayments of short-term borrowings
    
    
    
    
    
    
    (4,000
    )Exercise of stock options
    
    
    947
    
    
    
    2,572Treasury shares acquired under repurchase programs
    
    
    (1,718
    )
    
    
    (144
    )Excess tax benefits from stock-based compensation
    
    
    93
    
    
    
    178Cash dividends paid
    
    
    (17,364
    )
    
    
    (2,074
    )Guaranteed milestone payment
    
    
    (500
    )
    
    
    Net cash used in financing activities
    
    
    (18,542
    )
    
    
    (3,469
    )Effect of exchange rates on cash
    
    
    (423
    )
    
    
    46Increase in cash and cash equivalents
    
    
    991
    
    
    
    5,533Cash and cash equivalents, beginning of period
    
    
    9,479
    
    
    
    12,188Cash and cash equivalents, end of period
    
    $
    10,470
    
    
    $
    17,721Supplemental Cash Flow InformationCash paid during the period for:Income taxes paid
    
    $
    4,324
    
    
    $
    2,903Income taxes refunded
    
    $
    3,526
    
    
    $
    689Non-cash investing and financing activities:Net transfers of inventory to fixed assets
for use as demonstration equipment
    
    $
    2,992
    
    
    $
    3,068Dividends declared, not paid
    
    $
    1,526
    
    
    $
    15,932
  3




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##### Table of Contents



Datascope Corp. and Subsidiaries
 
 Notes to Condensed Consolidated Financial Statements
  1. Summary of Significant Accounting Policies
   Recent Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes Accounting for
Income Taxes.
 Fair
Value Measurements
 4




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 1. Summary of Significant Accounting Policies (Continued)
 Recent Accounting Pronouncements (Continued)
 Employers Accounting for Defined Benefit Pension
and Other Postretirement Plans .
 Quantifying Misstatements
 The Fair Value Option for Financial Assets and
Financial Liabilities   Including an amendment of FASB Statement No.
115
 5




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 2. Inventories
  December 31,
    
    
    June 30,2006
    
    
    2006Materials
    
    $
    24,760
    
    
    $
    24,408Work in process
    
    
    11,255
    
    
    
    12,582Finished goods
    
    
    24,843
    
    
    
    21,769$
    60,858
    
    
    $
    58,759
 3. Stockholders Equity
  Net earnings
    
    $
    7,868Foreign currency translation gain
    
    
    968Common stock and additional paid-in capital effects of
stock option activity
    
    
    1,507Cash dividends declared on common stock
    
    
    (17,820
    )Purchases under stock repurchase plans
    
    
    (1,718
    )Unrealized gain on available-for-sale securities
    
    
    227Total decrease in stockholders equity
    
    $
    (8,968
    )
 4. Earnings Per Share
  Six Months Ended
    
    
    Three Months Ended12/31/06
    
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/05Net earnings
    
    $
    7,868
    
    
    $
    10,507
    
    
    $
    3,335
    
    
    $
    4,451Weighted average shares outstanding
for basic earnings per share
    
    
    15,213
    
    
    
    14,816
    
    
    
    15,205
    
    
    
    14,834Effect of dilutive employee stock awards
    
    
    259
    
    
    
    324
    
    
    
    283
    
    
    
    328Weighted average shares outstanding
for diluted earnings per share
    
    
    15,472
    
    
    
    15,140
    
    
    
    15,488
    
    
    
    15,162Basic earnings per share
    
    $
    0.52
    
    
    $
    0.71
    
    
    $
    0.22
    
    
    $
    0.30Diluted earnings per share
    
    $
    0.51
    
    
    $
    0.69
    
    
    $
    0.22
    
    
    $
    0.29
 6




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 4. Earnings Per Share (Continued)
  5. Comprehensive Income
  Six Months Ended
    
    
    Three Months Ended12/31/06
    
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/05Net earnings
    
    $
    7,868
    
    
    $
    10,507
    
    
    $
    3,335
    
    
    $
    4,451Foreign currency translation gain (loss)
    
    
    968
    
    
    
    (866
    )
    
    
    1,153
    
    
    
    (532
    )Unrealized gain (loss) on available-for-sale
securities, net of tax
    
    
    227
    
    
    
    25
    
    
    
    (39
    )
    
    
    23Total comprehensive income
    
    $
    9,063
    
    
    $
    9,666
    
    
    $
    4,449
    
    
    $
    3,942
 6. Segment Information
     7




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 6. Segment Information (Continued)
 Cardiac
    
    
    InterventionalAssist /
    
    
    Products /
    
    
    CorporateMonitoring
    
    
    Vascular
    
    
    AndProducts
    
    
    Grafts
    
    
    Other
    
    
    ConsolidatedSix months ended December 31, 2006Net sales to external customers
    
    $
    159,281
    
    
    $
    22,942
    
    
    $
    577
    
    
    $
    182,800Operating earnings (loss)
    
    $
    17,222
    
    
    $
    (10,389
    )
    
    $
    1,120
    
    
    $
    7,953Six months ended December 31, 2005Net sales to external customers
    
    $
    153,511
    
    
    $
    26,420
    
    
    $
    869
    
    
    $
    180,800Operating earnings (loss)
    
    $
    22,713
    
    
    $
    (7,546
    )
    
    $
    (760
    )
    
    $
    14,407Three months ended December 31, 2006Net sales to external customers
    
    $
    83,996
    
    
    $
    11,356
    
    
    $
    248
    
    
    $
    95,600Operating earnings (loss)
    
    $
    8,373
    
    
    $
    (7,259
    )
    
    $
    699
    
    
    $
    1,813Three months ended December 31, 2005Net sales to external customers
    
    $
    79,333
    
    
    $
    12,758
    
    
    $
    409
    
    
    $
    92,500Operating earnings (loss)
    
    $
    12,109
    
    
    $
    (5,514
    )
    
    $
    (621
    )
    
    $
    5,974
 Six Months Ended
    
    
    Three Months Ended12/31/06
    
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/05Reconciliation to consolidated
earnings before income taxes:Consolidated operating earnings
    
    $
    7,953
    
    
    $
    14,407
    
    
    $
    1,813
    
    
    $
    5,974Interest income, net
    
    
    (1,276
    )
    
    
    (1,000
    )
    
    
    (577
    )
    
    
    (513
    )Dividend income
    
    
    (196
    )
    
    
    
    
    
    
    (196
    )
    
    
    Gain on sale of investment
    
    
    (1,273
    )
    
    
    
    
    
    
    (1,273
    )
    
    
    Other, net
    
    
    224
    
    
    
    1,071
    
    
    
    131
    
    
    
    402Consolidated earnings before income
taxes
    
    $
    10,474
    
    
    $
    14,336
    
    
    $
    3,728
    
    
    $
    6,085
  ®
  8




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 7. Stock-Based Awards
   Share-Based Payment
 
 Stock Options
   9




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 7. Stock-Based Awards (Continued)
 Stock Options (Continued)
  Six Months Ended
    
    Three Months EndedDecember 31,
    
    December 31,2006
    
    2005
    
    2006
    
    2005Expected dividend yield
    
    
    4.04
    %
    
    
    3.81
    %
    
    
    4.04
    %
    
    
    3.86
    %Expected volatility
    
    
    28
    %
    
    
    30
    %
    
    
    27
    %
    
    
    30
    %Risk-free interest rate
    
    
    4.58
    %
    
    
    4.25
    %
    
    
    4.62
    %
    
    
    4.33
    %Expected life (in years)
    
    
    4.8
    
    
    
    4.9
    
    
    
    4.8
    
    
    
    4.9
  WeightedNumber of
    
    
    AverageOptions
    
    
    Exercise PriceOptions outstanding, beginning of year
    
    
    2,040,626
    
    
    $
    32.47Granted
    
    
    139,250
    
    
    
    33.56Exercised
    
    
    (41,087
    )
    
    
    27.10Forfeited/Expired
    
    
    (133,679
    )
    
    
    35.47Options outstanding, end of period
    
    
    2,005,110
    
    
    $
    32.45Options exercisable, end of period
    
    
    1,750,335
    
    
    $
    32.16
    10




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 7. Stock-Based Awards (Continued)
 Stock Options (Continued)
   Restricted Stock
  8. Retirement Benefit Plans
 Defined Benefit Plans  U.S. and International
  Supplemental Executive Retirement Plans (SERPs)
  11




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 8. Retirement Benefit Plans (Continued)
  Six Months Ended December 31,2006
    
    
    2005
    
    
    2006
    
    
    2005U.S. and International
    
    
    SERPsService cost
    
    $
    1,315
    
    
    $
    1,848
    
    
    $
    175
    
    
    $
    200Interest cost
    
    
    2,010
    
    
    
    2,120
    
    
    
    500
    
    
    
    430Expected return on assets
    
    
    (1,836
    )
    
    
    (1,898
    )
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    7
    
    
    
    666
    
    
    
    4
    
    
    
    12Unrecognized prior service cost
    
    
    181
    
    
    
    8
    
    
    
    (37
    )
    
    
    (38
    )Curtailment loss
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    Net pension expense
    
    $
    1,691
    
    
    $
    2,744
    
    
    $
    642
    
    
    $
    604Employer contributions
    
    $
    1,100
    
    
    $
    2,555
 Three Months Ended December 31,2006
    
    
    2005
    
    
    2006
    
    
    2005U.S. and International
    
    
    SERPsService cost
    
    $
    595
    
    
    $
    924
    
    
    $
    51
    
    
    $
    100Interest cost
    
    
    976
    
    
    
    1,060
    
    
    
    287
    
    
    
    215Expected return on assets
    
    
    (913
    )
    
    
    (949
    )
    
    
    
    
    
    
    Amortization of:Net (gain) loss
    
    
    (88
    )
    
    
    333
    
    
    
    2
    
    
    
    6Unrecognized prior service cost
    
    
    178
    
    
    
    4
    
    
    
    (19
    )
    
    
    (19
    )Curtailment loss
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    Net pension expense
    
    $
    762
    
    
    $
    1,372
    
    
    $
    321
    
    
    $
    302Employer contributions
    
    $
    
    
    
    $
    1,055
  12




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##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 9. Intangible Assets and Goodwill
  December 31,
    
    
    June 30,2006
    
    
    2006Purchased technology and licenses, gross
    
    $
    22,133
    
    
    $
    21,941Accumulated amortization
    
    
    (1,981
    )
    
    
    (1,476
    )Purchased technology and licenses, net
    
    $
    20,152
    
    
    $
    20,465
    Goodwill
  New Distribution Agreement
  13




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Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 10. Commitments and Contingencies
 Legal Proceedings
   Credit Arrangements
  Other Contingencies
  11. Dividends and Stock Repurchase Program
  14




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Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 11. Dividends and Stock Repurchase Program (Continued)
   12. Income Taxes
  13. Special Items
 Fiscal 2007
  Interventional Products (IP) Division Exit Plan
  15




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Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 13. Special Items (Continued)
 ®
  Workforce Reductions in Patient Monitoring Division and the European Sales Organization
    16




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Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 13. Special Items (Continued)
  Workforce
    
    
    WorkforceExit Plan
    
    
    Reductions
    
    
    ReductionsIP
    
    
    PM
    
    
    Europe
    
    
    TotalFiscal 2007 Special ChargesSeverance expenses
    
    $
    2,878
    
    
    $
    510
    
    
    $
    2,603
    
    
    $
    5,991Contractual obligations
    
    
    953
    
    
    
    
    
    
    
    
    
    
    
    953Fixed assets and other non-cash
    
    
    365
    
    
    
    
    
    
    
    
    
    
    
    365Total
    
    $
    4,196
    
    
    $
    510
    
    
    $
    2,603
    
    
    $
    7,309Utilized Through December 31, 2006Severance expenses
    
    $
    1,521
    
    
    $
    218
    
    
    $
    452
    
    
    $
    2,191Contractual obligations
    
    
    55
    
    
    
    
    
    
    
    
    
    
    
    55Fixed assets and other non-cash
    
    
    365
    
    
    
    
    
    
    
    
    
    
    
    365Subtotal
    
    
    1,941
    
    
    
    218
    
    
    
    452
    
    
    
    2,611Remaining balance, December 31, 2006
    
    $
    2,255
    
    
    $
    292
    
    
    $
    2,151
    
    
    $
    4,698
  Gain on Sale of Investment
  Fiscal 2006
    14. Subsequent Event
  17




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Datascope Corp. and Subsidiaries
 
 Item 2.
    
    Managements Discussion and Analysis of Financial Condition and
Results of Operations
 Business Overview
       18




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® ®
    Results of Operations
 Net Sales
    19




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20




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®
      21




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Gross Profit (Net Sales Less Cost of Sales)
  Research and Development Expense (R&D)
     22




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Selling, General & Administrative Expense (SG&A)
     Special Items
 Fiscal 2007
  Interventional Products (IP) Division Exit Plan
   23




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Workforce Reductions in the Patient Monitoring Division and the European Sales Organization
     Fiscal 2006
   24




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Interest Income
  Gain on Sale of Investment
  Dividend Income
  Other, Net
  Income Taxes
  25




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Net Earnings
   New Distribution Agreement
  Subsequent Event
  Liquidity and Capital Resources
       26




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Information Concerning Forward Looking Statements
  27




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Critical Accounting Policies
  Recent Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes Accounting
for Income Taxes
 Fair
Value Measurements
 Employers Accounting for Defined Benefit Pension
and Other Postretirement Plans
 28




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Quantifying Misstatements
 
 The Fair Value Option for Financial Assets and
Financial Liabilities   Including an amendment of FASB Statement No.
115
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
   29




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Item 4. Controls and Procedures
    30




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PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
   
 Item 2. Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities
  Total Value ofTotal Number of
    
    
    Shares that MayTotal Number of
    
    
    Average
    
    
    Shares Purchased
    
    
    Yet Be PurchasedShares
    
    
    Price
    
    
    as a Part of Publicly
    
    
    Under the ProgramsFiscal
Period
    
    Purchased
    
    
    Per Share
    
    
    Announced Programs
    
    

($
000s)10/01/06 - 10/31/06
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    42,96311/01/06 - 11/30/06
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    42,96312/01/06 - 12/31/06
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    42,963Total second quarter
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    42,963
  31




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Item 4. Submission of Matters to a Vote of Security Holders
   L. Saper
    
    For:...... 14,152,787
    
    Withheld:...... 314,179R. Klatell
    
    For:...... 13,850,421
    
    Withheld:...... 616,545
  
 Item 5. Other Information
   
    
    November 1, 2006 pertaining to the Earnings Release of Datascope Corp.
dated October 31, 2006
    
    October 24, 2006 pertaining to the Companys decision to exit the
vascular closure market and phase out our Interventional Products business and most
of the workforce of that business by fiscal year-end
 
 Item 6. Exhibits
 31.1
    
    Certification of Principal Executive Officer Regarding Facts and Circumstances Relating
to Quarterly Reports31.2
    
    Certification of Principal Financial Officer Regarding Facts and Circumstances Relating
to Quarterly Reports32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002
 32




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DATASCOPE CORP. 
RegistrantBy:
    /s/ Lawrence SaperLawrence SaperChairman of the Board and
Chief Executive Officer By:
    /s/ Scott D. KantorScott D. KantorVice President, Finance and Administration,
and Chief Financial Officer  33