##### 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 March 31, 2008
 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
  Large accelerated filer
o
    
    Accelerated filer
þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




---



##### 



PagePART I. FINANCIAL INFORMATIONItem 1. Financial StatementsCondensed Consolidated Balance Sheets (Unaudited) at March 31, 2008 and June 30, 2007
    
    
    1Condensed Consolidated Statements of Earnings (Unaudited) Three and Nine Months Ended March 31, 2008 and 2007
    
    
    2Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended March 31, 2008 and 2007
    
    
    3Notes to Condensed Consolidated Financial Statements (Unaudited)
    
    
    4-21Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    22-32Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    32Item 4. Controls and Procedures
    
    
    33PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    34Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    35Item 6. Exhibits
    
    
    35SignaturesExhibit 31.1: Certification of Principal Executive OfficerExhibit 31.2: Certification of Principal Financial OfficerExhibit 32.1: Certification Pursuant to 18 U.S.C. Section 1350




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 Datascope Corp. and Subsidiaries
 
 Condensed Consolidated Balance Sheets
  March 31,
    
    
    June 30,2008
    
    
    2007(Unaudited)
    
    
    (a)AssetsCurrent assets:Cash and cash equivalents
    
    $
    17,588
    
    
    $
    15,780Short-term investments
    
    
    21,088
    
    
    
    23,681Accounts receivable less allowance for
doubtful accounts of $2,603
    
    
    86,593
    
    
    
    85,553Inventories
    
    
    38,247
    
    
    
    59,455Prepaid income taxes
    
    
    
    
    
    
    2,293Prepaid expenses and other current assets
    
    
    14,736
    
    
    
    11,167Current deferred taxes
    
    
    7,048
    
    
    
    7,238Current assets of discontinued operations
    
    
    29,775
    
    
    
    Total current assets
    
    
    215,075
    
    
    
    205,167Property, plant and equipment, net of accumulated
depreciation of $74,945 and $100,760
    
    
    51,593
    
    
    
    82,812Long-term investments
    
    
    24,323
    
    
    
    14,346Intangible assets, net
    
    
    19,608
    
    
    
    26,074Goodwill
    
    
    1,781
    
    
    
    12,860Other assets
    
    
    30,341
    
    
    
    34,897Noncurrent assets of discontinued operations
    
    
    61,850
    
    
    
    $
    404,571
    
    
    $
    376,156Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    9,709
    
    
    $
    18,386Dividends payable
    
    
    
    
    
    
    1,532Accrued expenses
    
    
    12,477
    
    
    
    16,129Accrued compensation
    
    
    16,190
    
    
    
    17,422Deferred revenue
    
    
    2,568
    
    
    
    4,380Income taxes payable
    
    
    3,099
    
    
    
    Current liabilities of discontinued operations
    
    
    18,681
    
    
    
    Total current liabilities
    
    
    62,724
    
    
    
    57,849Other liabilities
    
    
    24,461
    
    
    
    25,220Other liabilities of discontinued operations
    
    
    1,738
    
    
    
    Commitments and contingencies (Note 11)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, 19,228 and 18,867 shares
    
    
    192
    
    
    
    189Additional paid-in capital
    
    
    120,224
    
    
    
    109,384Treasury stock at cost, 3,567 and 3,521 shares
    
    
    (108,897
    )
    
    
    (107,037
    )Retained earnings
    
    
    299,836
    
    
    
    294,765Accumulated other comprehensive loss:Cumulative translation adjustments
    
    
    9,843
    
    
    
    1,899Benefit plan adjustments
    
    
    (5,641
    )
    
    
    (5,827
    )Unrealized gain (loss) on available-for-sale securities
    
    
    91
    
    
    
    (286
    )Total stockholders equity
    
    
    315,648
    
    
    
    293,087$
    404,571
    
    
    $
    376,156
 
 1




---



##### Table of Contents



Datascope Corp. and Subsidiaries
 
 Condensed Consolidated Statements of Earnings
   Nine Months Ended
    
    
    Three Months EndedMarch 31,
    
    
    March 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net sales
    
    $
    170,761
    
    
    $
    164,237
    
    
    $
    61,323
    
    
    $
    57,842Cost of sales
    
    
    59,608
    
    
    
    57,778
    
    
    
    20,948
    
    
    
    20,787Gross profit
    
    
    111,153
    
    
    
    106,459
    
    
    
    40,375
    
    
    
    37,055Operating expenses:Research and development expenses
    
    
    16,875
    
    
    
    17,210
    
    
    
    6,020
    
    
    
    5,544Selling, general and administrative expenses
    
    
    69,513
    
    
    
    69,062
    
    
    
    23,717
    
    
    
    22,676Special items
    
    
    
    
    
    
    5,574
    
    
    
    
    
    
    
    (804
    )86,388
    
    
    
    91,846
    
    
    
    29,737
    
    
    
    27,416Operating earnings
    
    
    24,765
    
    
    
    14,613
    
    
    
    10,638
    
    
    
    9,639Other (income) expense:Interest income
    
    
    (1,668
    )
    
    
    (1,910
    )
    
    
    (568
    )
    
    
    (569
    )Interest expense
    
    
    113
    
    
    
    87
    
    
    
    28
    
    
    
    22Dividend income
    
    
    
    
    
    
    (196
    )
    
    
    
    
    
    
    Gain on sale of investment
    
    
    (13,173
    )
    
    
    (1,273
    )
    
    
    
    
    
    
    Other, net
    
    
    (48
    )
    
    
    370
    
    
    
    (295
    )
    
    
    146(14,776
    )
    
    
    (2,922
    )
    
    
    (835
    )
    
    
    (401
    )Earnings from continuing operations before income taxes
    
    
    39,541
    
    
    
    17,535
    
    
    
    11,473
    
    
    
    10,040Income taxes
    
    
    13,028
    
    
    
    4,473
    
    
    
    2,433
    
    
    
    3,059Net earnings from continuing operations
    
    
    26,513
    
    
    
    13,062
    
    
    
    9,040
    
    
    
    6,981Net earnings from discontinued operations
    
    
    1,457
    
    
    
    2,667
    
    
    
    49
    
    
    
    880Net earnings
    
    $
    27,970
    
    
    $
    15,729
    
    
    $
    9,089
    
    
    $
    7,861Net earnings per share, basic:Continuing operations
    
    $
    1.73
    
    
    $
    0.86
    
    
    $
    0.59
    
    
    $
    0.46Discontinued operations
    
    
    0.09
    
    
    
    0.17
    
    
    
    
    
    
    
    0.06Net earnings
    
    $
    1.82
    
    
    $
    1.03
    
    
    $
    0.59
    
    
    $
    0.52Weighted average number of common
shares outstanding, basic
    
    
    15,369
    
    
    
    15,223
    
    
    
    15,407
    
    
    
    15,242Net earnings per share, diluted:Continuing operations
    
    $
    1.71
    
    
    $
    0.85
    
    
    $
    0.58
    
    
    $
    0.45Discontinued operations
    
    
    0.09
    
    
    
    0.17
    
    
    
    
    
    
    
    0.06Net earnings
    
    $
    1.80
    
    
    $
    1.02
    
    
    $
    0.58
    
    
    $
    0.51Weighted average number of common
shares outstanding, diluted
    
    
    15,519
    
    
    
    15,488
    
    
    
    15,566
    
    
    
    15,544Cash dividends declared per common share
    
    $
    1.30
    
    
    $
    1.27
    
    
    $
    0.20
    
    
    $
    0.10
  2




---



##### Table of Contents



Datascope Corp. and Subsidiaries
 
 Condensed Consolidated Statements of Cash Flows
   Nine Months EndedMarch 31,2008
    
    
    2007Operating Activities:Net earnings
    
    $
    27,970
    
    
    $
    15,729Adjustments to reconcile net earnings to net
cash provided by operating activities:Depreciation
    
    
    10,371
    
    
    
    11,444Amortization
    
    
    4,390
    
    
    
    4,603Provision for supplemental pension and post-retirement medical
    
    
    1,028
    
    
    
    976Provision for losses on accounts receivable
    
    
    276
    
    
    
    218Cash surrender value of officers life insurance
    
    
    (193
    )
    
    
    (288
    )Gain on sale of asset
    
    
    
    
    
    
    (2,235
    )Realized gain on sale of investment
    
    
    (13,173
    )
    
    
    (1,268
    )Stock-based compensation expense
    
    
    897
    
    
    
    642Excess tax benefits on stock-based compensation
    
    
    (695
    )
    
    
    (186
    )Deferred income tax (benefit) expense
    
    
    
    
    
    
    311Special charges asset write-offs
    
    
    
    
    
    
    365Intangible assets impairment
    
    
    841
    
    
    
    Changes in assets and liabilities:Accounts receivable
    
    
    (305
    )
    
    
    405Inventories
    
    
    (5,530
    )
    
    
    (4,529
    )Prepaid expenses and other assets
    
    
    (2,604
    )
    
    
    (1,597
    )Accounts payable
    
    
    388
    
    
    
    (1,433
    )Income taxes payable
    
    
    5,132
    
    
    
    Accrued and other liabilities
    
    
    (3,269
    )
    
    
    (2,708
    )Net cash
(used in) provided by operating activities
    
    
    25,524
    
    
    
    20,449Investing Activities:Capital expenditures
    
    
    (5,483
    )
    
    
    (4,052
    )Proceeds from asset sale
    
    
    
    
    
    
    3,000Purchases of investments
    
    
    (58,695
    )
    
    
    (72,329
    )Proceeds from investment maturities
    
    
    47,172
    
    
    
    59,912Proceeds from investment sales
    
    
    18,309
    
    
    
    23,826Capitalized software
    
    
    (5,661
    )
    
    
    (5,712
    )Purchased technology and licenses
    
    
    (13
    )
    
    
    (2,204
    )Other
    
    
    
    
    
    
    (88
    )Net cash
(used in) provided by investing activities
    
    
    (4,371
    )
    
    
    2,353Financing Activities:Exercise of stock options
    
    
    7,131
    
    
    
    2,628Treasury shares acquired under repurchase programs
    
    
    (1,860
    )
    
    
    (1,718
    )Excess tax benefits on stock-based compensation
    
    
    695
    
    
    
    186Cash dividends paid
    
    
    (21,580
    )
    
    
    (18,863
    )Guaranteed milestone payments
    
    
    (500
    )
    
    
    (500
    )Net cash used in financing activities
    
    
    (16,114
    )
    
    
    (18,267
    )Effect of exchange rates on cash
    
    
    (3,231
    )
    
    
    (712
    )Increase in cash and cash equivalents
    
    
    1,808
    
    
    
    3,823Cash and cash equivalents, beginning of period
    
    
    15,780
    
    
    
    9,479Cash and cash equivalents, end of period
    
    $
    17,588
    
    
    $
    13,302Supplemental Cash Flow InformationCash paid during the period for:Income taxes paid
    
    $
    11,430
    
    
    $
    7,862Income taxes refunded
    
    $
    3,726
    
    
    $
    3,527Non-cash investing and financing activities:Net transfers of inventory to fixed assets
for use as demonstration equipment
    
    $
    4,423
    
    
    $
    4,581Dividends declared, not paid
    
    $
    
    
    
    $
    1,526
  3




---



##### Table of Contents



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




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 1. Summary of Significant Accounting Policies (Continued)
 Recent Accounting Pronouncements, Not Required to be Adopted as of March 31, 2008
 Fair Value Measurements Effective Date of FASB Statement No. 157
 Accounting for
Deferred Compensation and Postretirement Benefits Aspects of Collateral Assignment Split-Dollar
Life Insurance Arrangements Employers Accounting for Postretirement Benefits Other Than Pensions Omnibus Opinion
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115
 5




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 1. Summary of Significant Accounting Policies (Continued)
 Recent Accounting Pronouncements, Not Required to be Adopted as of March 31, 2008 (Continued)
 Noncontrolling Interests in Consolidated Financial
Statements  an amendment of ARB No. 51
 Business Combinations
 2. Discontinued Operations
   Nine Months Ended
    
    
    Three Months Ended3/31/2008
    
    
    3/31/2007
    
    
    3/31/2008
    
    
    3/31/2007Net sales from discontinued operations
    
    $
    124,707
    
    
    $
    116,163
    
    
    $
    43,445
    
    
    $
    39,758Earnings
from discontinued operations before income taxes
    
    $
    2,117
    
    
    $
    4,446
    
    
    $
    (49)
    
    
    $
    1,467
 6




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 2. Discontinued Operations (Continued)
  Cash and cash equivalents
    
    $
    64Inventories
    
    
    25,266Prepaid and other current assets
    
    
    4,257Current deferred taxes
    
    
    188Current assets of discontinued operations
    
    $
    29,775Property, plant and equipment, net of
accumulated depreciation of $33,287
    
    $
    32,533Intangible assets, net
    
    
    5,973Goodwill
    
    
    12,991Other assets
    
    
    10,353Noncurrent assets of discontinued operations
    
    $
    61,850Accounts payable
    
    $
    9,171Accrued expenses and other current liabilities
    
    
    7,215Deferred revenue
    
    
    2,295Current liabilities of discontinued operations
    
    $
    18,681Other liabilities of discontinued operations
    
    $
    1,738
 3. Inventories
  March 31,
    
    
    June 30,2008
    
    
    2007Materials
    
    $
    14,909
    
    
    $
    20,189Work in process
    
    
    10,635
    
    
    
    11,253Finished goods
    
    
    12,703
    
    
    
    28,013$
    38,247
    
    
    $
    59,455
 7




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 4. Stockholders Equity
  Net earnings
    
    $
    27,970Foreign currency translation gain
    
    
    7,944Common stock and additional paid-in capital effects of
stock option activity
    
    
    10,843Cash dividends declared on common stock
    
    
    (20,084
    )Purchases under stock repurchase plans
    
    
    (1,860
    )Benefit plan adjustments
    
    
    186Unrealized gain on available-for-sale securities
    
    
    377Cumulative effect of FIN 48 adoption
    
    
    (2,815
    )Total increase in stockholders equity
    
    $
    22,561
 5. Earnings Per Share
  Nine Months Ended
    
    
    Three Months Ended3/31/2008
    
    
    3/31/2007
    
    
    3/31/2008
    
    
    3/31/2007Net earnings
    
    $
    27,970
    
    
    $
    15,729
    
    
    $
    9,089
    
    
    $
    7,861Weighted average shares outstanding
for basic earnings per share
    
    
    15,369
    
    
    
    15,223
    
    
    
    15,407
    
    
    
    15,242Effect of dilutive employee stock awards
    
    
    150
    
    
    
    265
    
    
    
    159
    
    
    
    302Weighted average shares outstanding
for diluted earnings per share
    
    
    15,519
    
    
    
    15,488
    
    
    
    15,566
    
    
    
    15,544Basic earnings per share
    
    $
    1.82
    
    
    $
    1.03
    
    
    $
    0.59
    
    
    $
    0.52Diluted earnings per share
    
    $
    1.80
    
    
    $
    1.02
    
    
    $
    0.58
    
    
    $
    0.51
  8




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 6. Comprehensive Income
  Nine Months Ended
    
    
    Three Months Ended3/31/2008
    
    
    3/31/2007
    
    
    3/31/2008
    
    
    3/31/2007Net earnings
    
    $
    27,970
    
    
    $
    15,729
    
    
    $
    9,089
    
    
    $
    7,861Foreign currency translation gain
    
    
    7,944
    
    
    
    1,407
    
    
    
    4,342
    
    
    
    439Benefit plan adjustments
    
    
    186
    
    
    
    
    
    
    
    42
    
    
    
    Unrealized gain (loss) on
available-for-sale
securities, net of tax
    
    
    377
    
    
    
    184
    
    
    
    5
    
    
    
    (43
    )Total comprehensive income
    
    $
    36,477
    
    
    $
    17,320
    
    
    $
    13,478
    
    
    $
    8,257
 7. Segment Information
      9




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 7. Segment Information (Continued)
 Cardiac
Assist
Products
    
    

Interventional/
Vascular
Products
    
    

Corporate
and
Other
    
    

Continuing
OperationsNine months ended March 31, 2008Net sales to external customers
    
    $
    138,115
    
    
    $
    31,680
    
    
    $
    966
    
    
    $
    170,761Operating earnings (loss)
    
    $
    26,040
    
    
    $
    (579
    )
    
    $
    (696
    )
    
    $
    24,765Assets
    
    $
    134,444
    
    
    $
    90,674
    
    
    $
    87,828
    
    
    $
    312,946Nine months ended March 31, 2007Net sales to external customers
    
    $
    131,707
    
    
    $
    31,627
    
    
    $
    903
    
    
    $
    164,237Operating earnings (loss)
    
    $
    24,793
    
    
    $
    (7,982
    )
    
    $
    (2,198
    )
    
    $
    14,613Assets
    
    $
    119,918
    
    
    $
    81,381
    
    
    $
    100,994
    
    
    $
    302,293Three months ended March 31, 2008Net sales to external customers
    
    $
    49,176
    
    
    $
    11,811
    
    
    $
    336
    
    
    $
    61,323Operating earnings (loss)
    
    $
    10,601
    
    
    $
    572
    
    
    $
    (535
    )
    
    $
    10,638Three months ended March 31, 2007Net sales to external customers
    
    $
    46,387
    
    
    $
    11,129
    
    
    $
    326
    
    
    $
    57,842Operating earnings (loss)
    
    $
    9,244
    
    
    $
    1,867
    
    
    $
    (1,472
    )
    
    $
    9,639
 Reconciliation to earnings from
continuing operations

    
    Nine Months Ended
    
    
    Three Months Endedbefore income taxes:
    
    3/31/2008
    
    
    3/31/2007
    
    
    3/31/2008
    
    
    3/31/2007Operating earnings from continuing operations
    
    $
    24,765
    
    
    $
    14,613
    
    
    $
    10,638
    
    
    $
    9,639Interest income, net
    
    
    1,555
    
    
    
    1,823
    
    
    
    540
    
    
    
    547Dividend income
    
    
    
    
    
    
    196
    
    
    
    
    
    
    
    Gain on sale of investment
    
    
    13,173
    
    
    
    1,273
    
    
    
    
    
    
    
    Other, net
    
    
    48
    
    
    
    (370
    )
    
    
    295
    
    
    
    (146
    )Earnings from continuing
operations before income taxes
    
    $
    39,541
    
    
    $
    17,535
    
    
    $
    11,473
    
    
    $
    10,040
    10




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 7. Segment Information (Continued)
  8. Stock-Based Awards
    Share-Based Payment
 Nine Months Ended
    
    
    Three Months Ended3/31/2008
    
    
    3/31/2007
    
    
    3/31/2008
    
    
    3/31/2007Continuing operationsCost of sales
    
    $
    17
    
    
    $
    4
    
    
    $
    7
    
    
    $
    1Research and development expenses
    
    
    84
    
    
    
    64
    
    
    
    27
    
    
    
    24Selling, general and administrative expenses
    
    
    605
    
    
    
    447
    
    
    
    259
    
    
    
    223Total stock-based compensation expense
    
    $
    706
    
    
    $
    515
    
    
    $
    293
    
    
    $
    248Total stock-based compensation expense, net
of tax
    
    $
    417
    
    
    $
    305
    
    
    $
    173
    
    
    $
    147Discontinued operationsNet earnings from discontinued operations
    
    $
    113
    
    
    $
    75
    
    
    $
    28
    
    
    $
    20
 11




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 8. Stock-Based Awards (Continued)
  Nine Months Ended
    
    Three Months EndedMarch 31,
    
    March 31,2008
    
    2007
    
    2008
    
    2007Expected dividend yield
    
    
    *
    
    
    
    4.03
    %
    
    
    *
    
    
    
    3.85
    %Expected volatility
    
    
    *
    
    
    
    28
    %
    
    
    *
    
    
    
    27
    %Risk-free interest rate
    
    
    *
    
    
    
    4.58
    %
    
    
    *
    
    
    
    4.50
    %Expected life (in years)
    
    
    *
    
    
    
    4.8
    
    
    
    *
    
    
    
    4.8
 
 *
    
    Not applicable.   Stock Options
  12




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 8. Stock-Based Awards (Continued)
 Stock Options (Continued)
  WeightedNumber of
    
    AverageOptions
    
    Exercise PriceOptions outstanding, beginning of year
    
    
    1,741,161
    
    
    $
    32.47Granted
    
    
    
    
    
    
    Exercised
    
    
    (292,506
    )
    
    
    31.71Forfeited/Expired
    
    
    (67,700
    )
    
    
    34.93Options outstanding, end of period
    
    
    1,380,955
    
    
    
    32.51Options vested and expected to vest,
end of period
    
    
    1,360,670
    
    
    
    32.47Options exercisable, end of period
    
    
    1,248,293
    
    
    
    32.27
      13




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 8. Stock-Based Awards (Continued)
 Restricted Stock
  WeightedAverageShares
    
    Grant PriceNonvested, beginning of year
    
    
    3,908
    
    
    $
    35.84Awarded
    
    
    70,517
    
    
    
    32.82Released
    
    
    (4,024
    )
    
    
    35.83Forfeited
    
    
    (6,660
    )
    
    
    32.44Nonvested, end of period
    
    
    63,741
    
    
    
    32.85
  9. Retirement Benefit Plans
 Defined Benefit Pension Plans  U.S. and International
  Supplemental Executive Retirement Plans (SERP)
  Post-Retirement Medical Benefits Plan
  14




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 9. Retirement Benefit Plans (Continued)
 Net Periodic Benefit Costs
  Nine Months Ended March 31,2008
    
    
    2007
    
    
    2008
    
    
    2007U.S. and International
    
    
    SERPService cost
    
    $
    2,176
    
    
    $
    1,978
    
    
    $
    282
    
    
    $
    262Interest cost
    
    
    3,338
    
    
    
    2,981
    
    
    
    793
    
    
    
    750Expected return on assets
    
    
    (3,182
    )
    
    
    (2,708
    )
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    313
    
    
    
    381
    
    
    
    9
    
    
    
    7Unrecognized prior
service (credit) cost
    
    
    (31
    )
    
    
    9
    
    
    
    (72
    )
    
    
    (56
    )Curtailment loss
    
    
    
    
    
    
    14
    
    
    
    
    
    
    
    Net periodic benefit costs
    
    $
    2,614
    
    
    $
    2,655
    
    
    $
    1,012
    
    
    $
    963Employer contributions
    
    $
    7,700
    
    
    $
    5,000
 Nine Months EndedMarch 31,2008
    
    
    2007Post-Retirement MedicalService cost
    
    $
    
    
    
    $
    Interest cost
    
    
    11
    
    
    
    9Expected return on assets
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    2
    
    
    
    1Unrecognized prior service cost
    
    
    3
    
    
    
    3Net periodic benefit costs
    
    $
    16
    
    
    $
    13
 15




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 9. Retirement Benefit Plans (Continued)
 Net Periodic Benefit Costs (Continued)
 Three Months Ended March 31,2008
    
    
    2007
    
    
    2008
    
    
    2007U.S. and International
    
    
    SERPService cost
    
    $
    725
    
    
    $
    722
    
    
    $
    94
    
    
    $
    87Interest cost
    
    
    1,113
    
    
    
    1,088
    
    
    
    265
    
    
    
    250Expected return on assets
    
    
    (1,060
    )
    
    
    (988
    )
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    104
    
    
    
    139
    
    
    
    3
    
    
    
    3Unrecognized prior
service (credit) cost
    
    
    (11
    )
    
    
    3
    
    
    
    (24
    )
    
    
    (19
    )Curtailment loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net periodic benefit costs
    
    $
    871
    
    
    $
    964
    
    
    $
    338
    
    
    $
    321Employer contributions
    
    $
    5,200
    
    
    $
    3,900
 Three Months EndedMarch 31,2008
    
    
    2007Post-Retirement MedicalService cost
    
    $
    
    
    
    $
    Interest cost
    
    
    3
    
    
    
    3Expected return on assets
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    1
    
    
    
    1Unrecognized prior service cost
    
    
    1
    
    
    
    Net periodic benefit costs
    
    $
    5
    
    
    $
    4
 16




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 10. Intangible Assets and Goodwill
 Intangible Assets
  March 31,
    
    
    June 30,2008
    
    
    2007Amortized intangible assets:Purchased technology
    
    $
    19,087
    
    
    $
    22,176Licenses
    
    
    2,887
    
    
    
    5,272Customer relationships and other
    
    
    
    
    
    
    1,077Subtotal
    
    
    21,974
    
    
    
    28,525Accumulated amortization:Purchased technology
    
    
    (1,467
    )
    
    
    (1,300
    )Licenses
    
    
    (899
    )
    
    
    (1,512
    )Customer relationships and other
    
    
    
    
    
    
    (12
    )Subtotal
    
    
    (2,366
    )
    
    
    (2,824
    )Amortized intangible assets, net
    
    $
    19,608
    
    
    $
    25,701Indefinite-lived intangible assets:Trade name
    
    $
    
    
    
    $
    373
    Year Ending June 30,2008
    
    2009
    
    2010
    
    2011
    
    2012Amortization expense
    
    $
    221
    
    
    $
    884
    
    
    $
    990
    
    
    $
    1,094
    
    
    $
    1,200
  Goodwill
  17




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 11. Commitments and Contingencies
 Legal Proceedings
    Credit Arrangements
  18




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 12. Dividends and Stock Repurchase Program
 Dividends
  Per ShareDeclaration Date
    
    Dividend
    
    Type
    
    Record Date
    
    Payment DateFiscal 2008February 27, 2008
    
    $0.10
    
    Regular
    
    March 10, 2008
    
    March 26, 2008January 9, 2008
    
    $0.10
    
    Regular
    
    January 22, 2008
    
    February 8, 2008September 21, 2007
    
    $1.00
    
    Special
    
    October 1, 2007
    
    October 15, 2007$0.10
    
    RegularFiscal 2007February 26, 2007
    
    $0.10
    
    Regular
    
    March 7, 2007
    
    April 2, 2007December 13, 2006
    
    $0.10
    
    Regular
    
    December 27, 2006
    
    January 16, 2007September 13, 2006
    
    $1.00
    
    Special
    
    September 28, 2006
    
    October 6, 2006$0.07
    
    Regular
 Stock Repurchases
   Nine Months Ended
    
    Three Months Ended3/31/2008
    
    3/31/2007
    
    3/31/2008
    
    3/31/2007Shares of common stock repurchased
    
    
    46
    
    
    
    56
    
    
    
    46
    
    
    
    Cost of common stock repurchased
    
    $
    1,860
    
    
    $
    1,718
    
    
    $
    1,860
    
    
    $
    
 19




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 13. Income Taxes
   Adoption of New Accounting Standard
  Balance at
    
    
    
    
    
    Balance atJune 30,
    
    FIN 48
    
    July 1,2007
    
    Adjustment
    
    2007Other assets
    
    $
    34,897
    
    
    $
    239
    
    
    $
    35,136Accrued expenses / income taxes payable
    
    
    17,661
    
    
    
    (1,578
    )
    
    
    16,083Other liabilities
    
    
    25,220
    
    
    
    4,632
    
    
    
    29,852Retained earnings
    
    
    294,765
    
    
    
    (2,815
    )
    
    
    291,950
   20




---



##### Table of Contents



Datascope Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  Continued
 13. Income Taxes (Continued)
 Adoption of New Accounting Standard (Continued)
  14. Special Items
  
    
    Interventional Products Division exit plan totaling $5.0 million
    
    Severance, settlement and other termination benefits of $6.0 million for workforce
reductions in the Patient Monitoring Division, the European sales organization, Corporate
and Genisphere
    
    Goodwill impairment charge of $2.3 million related to Genisphere
    
    Inquiry expenses of $1.7 million related to the Audit Committee investigations of
ethics line reports
    
    Gain on sale of ProGuide assets totaling $2.2 million
  15. Gain on Sale of Investment
  21




---



##### Table of Contents



Datascope Corp. and Subsidiaries
 
 Item 2.
    
    Managements Discussion and Analysis of Financial Condition and
Results of Operations
 Business Overview
      22




---



##### Table of Contents



23




---



##### Table of Contents



Results of Operations
 Net Sales
        24




---



##### Table of Contents



Gross Profit (Net Sales Less Cost of Sales)
   Research and Development Expense (R&D)
  25




---



##### Table of Contents



Selling, General & Administrative Expense (SG&A)
     26




---



##### Table of Contents



Interest Income
  Other, Net
  Gain on Sale of Investment
  Income Taxes
   Net Earnings from Continuing Operations
  27




---



##### Table of Contents



Net Earnings from Discontinued Operations
  Net Earnings
   Liquidity and Capital Resources
    28




---



##### Table of Contents



29




---



##### Table of Contents



Information Concerning Forward Looking Statements
  Critical Accounting Policies
  Recent Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
 30




---



##### Table of Contents



, Fair Value Measurements Effective Date of FASB Statement No. 157
 Accounting for
Deferred Compensation and Postretirement Benefits Aspects of Collateral Assignment Split-Dollar
Life Insurance Arrangements Employers Accounting for Postretirement Benefits Other Than Pensions Omnibus Opinion
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115
 31




---



##### Table of Contents



Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51
 Business Combinations
 
 Quantitative and Qualitative Disclosures about Market Risk
    32




---



##### Table of Contents



Controls and Procedures
    33




---



##### Table of Contents



34




---



##### Table of Contents



Total Value of SharesTotal
    
    
    
    
    
    
    Total Number of
    
    
    that May Yet BeNumber of
    
    
    Average
    
    
    Shares Purchased as
    
    
    Purchased Under theShares
    
    
    Price
    
    
    a Part of Publicly
    
    
    ProgramsFiscal Period
    
    Purchased
    
    
    Per Share
    
    
    Announced Programs
    
    
    ($000s)01/01/08 - 01/31/08
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    42,96302/01/08 - 02/29/08
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    42,96303/01/08 - 03/31/08
    
    
    46,600
    
    
    $
    39.914
    
    
    
    46,600
    
    
    $
    41,103Total third quarter
    
    
    46,600
    
    
    $
    39.914
    
    
    
    46,600
    
    
    $
    41,103
  
  10.1
    
    Asset Purchase Agreement dated March 10, 2008 by and between Datascope Corp. and Mindray Medical International Limited (filed as Exhibit 10.1 to the Current Report on Form 8-K filed on March 12, 2008 and incorporated herein by reference).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
 35




---



##### Table of Contents



DATASCOPE CORP.
RegistrantBy:
    /s/ Lawrence SaperLawrence SaperChairman of the Board and
Chief Executive OfficerBy:
    /s/ Henry M. ScaramelliHenry M. ScaramelliVice President, Finance and
Chief Financial Officer