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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q

|                                |     |                                                        
|------------------------------- | --- | -------------------------------------------------------
|                                | [X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2003

OR

|                                |      |                                                         
|------------------------------- | ---- | --------------------------------------------------------
|                                | [ 
] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from
           to

Commission File No. 0-22623

OCULAR SCIENCES, INC.

(Exact name of registrant as specified in its charter)


|                                |  |                    
|------------------------------- |  | -------------------
|Delaware                        |  | 94-2985696         
|(State or other jurisdiction of |  | (I.R.S. Employer   
|incorporation or organization)  |  | Identification No.)

|                                         |  |           
|---------------------------------------- |  | ----------
|1855 Gateway Boulevard, Suite 700        |  | 94520     
|Concord, California                      |  | (Zip Code)
|(Address of principal executive offices) |  |           

Registrants telephone number, including area code: (925) 969-7000

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. YES [X]  NO
[  ].

Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). YES [X]  NO
[  ].

As of May 2, 2003, there were 23,815,838 outstanding shares of the registrants
Common Stock, par value $0.001 per share.



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TABLE OF CONTENTS



|                               |                                                                                               |                                                      |  |  |  |  |  | 
|------------------------------ | --------------------------------------------------------------------------------------------- | ---------------------------------------------------- |  |  |  |  |  | 
|PART I  FINANCIAL INFORMATION
|                               | ITEM 1. Financial Statements                                                                 
|                               |                                                                                               | Condensed Consolidated Balance Sheets               
|                               |                                                                                               | Condensed Consolidated Statements of Income         
|                               |                                                                                               | Condensed Consolidated Statements of Cash Flows     
|                               |                                                                                               | NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
|                               | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|                               | Item 3. Quantitative And Qualitative Disclosures About Market Risk                           
|                               | Item 4. Controls and Procedures                                                              
|Part II  OTHER INFORMATION   
|                               | Item 1. Legal Proceedings                                                                    
|                               | Item 2. Changes in Securities and Use of Proceeds                                            
|                               | Item 3. Defaults Upon Senior Securities                                                      
|                               | Item 4. Submission of Matters to a Vote of Security Holders                                  
|                               | Item 5. Other Information                                                                    
|                               | Item 6. Exhibits and Reports on Form 8-K                                                     
|SIGNATURES                    
|CERTIFICATIONS                



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OCULAR SCIENCES, INC.

INDEX

|          |  |                                                                                              |  |     
|--------- |  | -------------------------------------------------------------------------------------------- |  | ----
|          |  |                                                                                              |  | Page
|          |  |                                                                                              |  |     
|PART I   |  | FINANCIAL INFORMATION                                                                        |  |     
|Item 1.   |  | Financial Statements (Unaudited)                                                             |  |     
|          |  | Condensed Consolidated Balance Sheets  March 31, 2003 and December 31, 2002                 |  | 3   
|          |  | Condensed Consolidated Statements of Income  Three Months Ended March 31, 2003 and 2002     |  | 4   
|          |  | Condensed Consolidated Statements of Cash Flows  Three Months Ended March 31, 2003 and 2002 |  | 5   
|          |  | Notes to Condensed Consolidated Financial Statements                                         |  | 6   
|Item 2.   |  | Managements Discussion and Analysis of Financial Condition and Results of Operations        |  | 13  
|Item 3.   |  | Quantitative and Qualitative Disclosures about Market Risk                                   |  | 20  
|Item 4.   |  | Controls and Procedures                                                                      |  | 20  
|PART II  |  | OTHER INFORMATION                                                                            |  |     
|Item 1.   |  | Legal Proceedings                                                                            |  | 20  
|Item 2.   |  | Changes in Securities and Use of Proceeds                                                    |  | 20  
|Item 3.   |  | Defaults Upon Senior Securities                                                              |  | 20  
|Item 4.   |  | Submission of Matters to a Vote of Security Holders                                          |  | 20  
|Item 5.   |  | Other Information                                                                            |  | 20  
|Item 6.   |  | Exhibits and Reports on Form 8-K                                                             |  | 21  
|          |  | Signatures and Certifications                                                                |  | 21  

2



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PART I  FINANCIAL INFORMATION




ITEM 1. Financial Statements




OCULAR SCIENCES, INC.
Condensed Consolidated Balance Sheets  (unaudited)
(In thousands, except share and per share data)




|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |         | 
|----------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | --------- | ------- | ------------ | ------- | ------- | ------- | 
|                                                                                                                                                      |                                                                                                                                  |                                            |         | March 31, |         | December 31,
|                                                                                                                                                      |                                                                                                                                  |                                            |         | 2003      |         | 2002*       
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |             
|ASSETS                                                                                                                                                |                                                                                                                                  |                                            |         |           |         |              |         |        
|Current Assets:                                                                                                                                       |                                                                                                                                  |                                            |         |           |         |              |         |        
|                                                                                                                                                      | Cash and cash equivalents                                                                                                        |                                            | $       | 13,163    |         |              | $       | 11,414  |        
|                                                                                                                                                      | Accounts receivable, less allowance for sales returns and doubtful accounts
of $4,242 and $3,818 for 2003 and 2002, respectively |                                            |         | 52,944    |         |              |         | 56,416  |        
|                                                                                                                                                      | Inventories                                                                                                                      |                                            |         | 78,424    |         |              |         | 74,515  |        
|                                                                                                                                                      | Prepaid expenses and other current assets                                                                                        |                                            |         | 30,317    |         |              |         | 28,572  |        
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|                                                                                                                                                      |                                                                                                                                  | Total current assets                       |         |           | 174,848 |              |         |         | 170,917 | 
|                                                                                                                                                      | Property and equipment, net                                                                                                      |                                            |         | 119,573   |         |              |         | 119,941 |        
|                                                                                                                                                      | Intangible assets, net                                                                                                           |                                            |         | 56,024    |         |              |         | 55,815  |        
|                                                                                                                                                      | Loans to Officers and employees                                                                                                  |                                            |         | 864       |         |              |         | 956     |        
|                                                                                                                                                      | Other assets                                                                                                                     |                                            |         | 4,286     |         |              |         | 4,460   |        
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|                                                                                                                                                      |                                                                                                                                  | Total assets                               |         | $         | 355,595 |              |         | $       | 352,089 | 
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                  |                                                                                                                                  |                                            |         |           |         |              |         |        
|Current Liabilities:                                                                                                                                  |                                                                                                                                  |                                            |         |           |         |              |         |        
|                                                                                                                                                      | Accounts Payable                                                                                                                 |                                            | $       | 9,391     |         |              | $       | 10,009  |        
|                                                                                                                                                      | Accrued liabilities                                                                                                              |                                            |         | 58,198    |         |              |         | 55,838  |        
|                                                                                                                                                      | Current portion of long-term debt                                                                                                |                                            |         | 378       |         |              |         | 420     |        
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|                                                                                                                                                      |                                                                                                                                  | Total current liabilities                  |         |           | 67,967  |              |         |         | 66,267  | 
|                                                                                                                                                      | Deferred income taxes                                                                                                            |                                            |         | 4,118     |         |              |         | 4,200   |        
|                                                                                                                                                      | Other liabilities                                                                                                                |                                            |         | 1,342     |         |              |         | 942     |        
|                                                                                                                                                      | Long-term debt, less current portion                                                                                             |                                            |         | 26,674    |         |              |         | 30,730  |        
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|                                                                                                                                                      |                                                                                                                                  | Total liabilities                          |         |           | 100,101 |              |         |         | 102,139 | 
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|Commitments and Contingencies                                                                                                                         |                                                                                                                                  |                                            |         |           |         |              |         |        
|Stockholders Equity:                                                                                                                                 |                                                                                                                                  |                                            |         |           |         |              |         |        
|Preferred stock, $0.001 par value; 4,000,000 shares authorized; none issued                                                                           |                                                                                                                                  |                                            |        |           |         |              |        |        
|Common stock, $0.001 par value; 80,000,000 shares authorized; 23,812,438 and
23,811,638 shares issued and outstanding for 2003 and 2002, respectively |                                                                                                                                  |                                            | 24      |           |         |              | 24      |        
|Additional paid-in capital                                                                                                                            |                                                                                                                                  |                                            | 91,144  |           |         |              | 91,632  |        
|Retained earnings                                                                                                                                     |                                                                                                                                  |                                            | 161,755 |           |         |              | 155,837 |        
|Accumulated other comprehensive income                                                                                                                |                                                                                                                                  |                                            | 2,571   |           |         |              | 2,457   |        
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|                                                                                                                                                      |                                                                                                                                  | Total stockholders equity                 |         |           | 255,494 |              |         |         | 249,950 | 
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        
|                                                                                                                                                      |                                                                                                                                  | Total liabilities and stockholders equity |         | $         | 355,595 |              |         | $       | 352,089 | 
|                                                                                                                                                      |                                                                                                                                  |                                            |         |           |         |              |         |         |        



|* |  | The consolidated balance sheet at December 31, 2002 has been derived from
the companys audited consolidated financial statements at that date, but
does not include all of the information and footnotes required by
generally accepted accounting principles for complete financial
statements.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

See accompanying notes to condensed consolidated financial statements.

3



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OCULAR SCIENCES, INC.
Condensed Consolidated Statements of Income  (unaudited)
(In thousands, except share and per share data)




|                                   |                                                                                   |   |                    |            |  |  |  |  |      |   |        |            | 
|---------------------------------- | --------------------------------------------------------------------------------- | - | ------------------ | ---------- |  |  |  |  | ---- | - | ------ | ---------- | 
|                                   |                                                                                   |   | Three months ended
|                                   |                                                                                   |   | March 31,         
|                                   |                                                                                   |   |                   
|                                   |                                                                                   |   | 2003               |            |  |  |  |  | 2002
|                                   |                                                                                   |   |                    |            |  |  |  |  |     
|Net sales                          |                                                                                   | $ | 70,691             |            |  |  |  |  |      | $ | 60,811 |           
|Cost of sales                      |                                                                                   |   | 33,214             |            |  |  |  |  |      |   | 27,330 |           
|                                   |                                                                                   |   |                    |            |  |  |  |  |      |   |        |            | 
|                                   | Gross profit                                                                      |   |                    | 37,477     |  |  |  |  |      |   |        | 33,481     | 
|Selling and marketing expense      |                                                                                   |   | 15,326             |            |  |  |  |  |      |   | 10,137 |           
|General and administrative expense |                                                                                   |   | 11,923             |            |  |  |  |  |      |   | 10,032 |           
|Research and development expense   |                                                                                   |   | 1,716              |            |  |  |  |  |      |   | 1,018  |           
|Restructuring and related expenses |                                                                                   |   | 1,186              |            |  |  |  |  |      |   |       |           
|                                   |                                                                                   |   |                    |            |  |  |  |  |      |   |        |            | 
|                                   | Income from operations                                                            |   |                    | 7,326      |  |  |  |  |      |   |        | 12,294     | 
|Interest expense                   |                                                                                   |   | (192               | )          |  |  |  |  |      |   | (341   | )         
|Interest income                    |                                                                                   |   | 71                 |            |  |  |  |  |      |   | 26     |           
|Other income                       |                                                                                   |   | 146                |            |  |  |  |  |      |   | 330    |           
|                                   |                                                                                   |   |                    |            |  |  |  |  |      |   |        |            | 
|                                   | Income before income taxes                                                        |   |                    | 7,351      |  |  |  |  |      |   |        | 12,309     | 
|Income taxes                       |                                                                                   |   | (1,433             | )          |  |  |  |  |      |   | (2,216 | )         
|                                   |                                                                                   |   |                    |            |  |  |  |  |      |   |        |            | 
|                                   | Net Income                                                                        |   | $                  | 5,918      |  |  |  |  |      |   | $      | 10,093     | 
|                                   |                                                                                   |   |                    |            |  |  |  |  |      |   |        |            | 
|Net income per share data:         |                                                                                   |   |                    |            |  |  |  |  |      |   |        |           
|                                   | Net income per share (basic)                                                      |   | $                  | 0.25       |  |  |  |  |      |   | $      | 0.43       | 
|                                   | Net income per share (diluted)                                                    |   | $                  | 0.25       |  |  |  |  |      |   | $      | 0.41       | 
|                                   | Weighted average common shares outstanding                                        |   |                    | 23,811,887 |  |  |  |  |      |   |        | 23,498,971 | 
|                                   | Weighted average dilutive potential common shares under
the treasury stock method |   |                    | 100,650    |  |  |  |  |      |   |        | 950,115    | 
|                                   | Total weighted average common and dilutive potential common
shares outstanding    |   |                    | 23,912,537 |  |  |  |  |      |   |        | 24,449,086 | 

See accompanying notes to condensed consolidated financial statements.

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OCULAR SCIENCES, INC.
Condensed Consolidated Statements of Cash Flows  (unaudited)
(In thousands)




|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|------------------------------------------------------------ | --------------------------------------------------------------------------------- | ------------------------------------------ | ------------------------------------------------------ | ---------------------------------------------------- | ------- | ---------------------------- | ------ | ------ | ------- | ------ | ------- | -
|                                                             |                                                                                   |                                            |                                                        |                                                      |         | Three months ended March 31,
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                             
|                                                             |                                                                                   |                                            |                                                        |                                                      |         | 2003                         |        | 2002  
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |       
|Cash flows from operating activities                         |                                                                                   |                                            |                                                        |                                                      |         |                              |        |       
|                                                             | Net Income                                                                        |                                            | $                                                      | 5,918                                                |         |                              | $      | 10,093 |        
|                                                             | Adjustments to reconcile net income to net cash provided by
operating activities: |                                            |                                                        |                                                      |         |                              |        |        |        
|                                                             |                                                                                   |                                            | Depreciation and amortization                          |                                                      |         | 6,261                        |        |        |         | 4,754  |        
|                                                             |                                                                                   |                                            | Amortization of loans to officers                      |                                                      |         | 92                           |        |        |         | 101    |        
|                                                             |                                                                                   |                                            | Income tax benefits from stock options exercised       |                                                      |         |                             |        |        |         | 249    |        
|                                                             |                                                                                   |                                            | Provision for sales returns and doubtful accounts      |                                                      |         | 424                          |        |        |         | (110   | )      
|                                                             |                                                                                   |                                            | Loss on disposal of property and equipment             |                                                      |         |                             |        |        |         | 119    |        
|                                                             |                                                                                   |                                            | Exchange gain                                          |                                                      |         | (304                         | )      |        |         | (447   | )      
|                                                             |                                                                                   |                                            | Deferred income taxes                                  |                                                      |         | (82                          | )      |        |         | (430   | )      
|                                                             | Changes in operating assets and liabilities:                                      |                                            |                                                        |                                                      |         |                              |        |        |        
|                                                             |                                                                                   |                                            | Accounts receivable                                    |                                                      |         | 3,048                        |        |        |         | (7,239 | )      
|                                                             |                                                                                   |                                            | Inventories                                            |                                                      |         | (3,909                       | )      |        |         | (995   | )      
|                                                             |                                                                                   |                                            | Prepaid expenses, other current and non-current assets |                                                      |         | (1,569                       | )      |        |         | 9,046  |        
|                                                             |                                                                                   |                                            | Accounts payable                                       |                                                      |         | (618                         | )      |        |         | (4,922 | )      
|                                                             |                                                                                   |                                            | Accrued and other liabilities                          |                                                      |         | 2,261                        |        |        |         | (2,638 | )      
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|                                                             |                                                                                   |                                            |                                                        | Net cash provided by operating activities            |         |                              | 11,522 |        |         |        | 7,581   |  
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|Cash flows from investing activities:                        |                                                                                   |                                            |                                                        |                                                      |         |                              |        |       
|                                                             |                                                                                   | Purchases of property and equipment        |                                                        |                                                      | (6,153  | )                            |        |        | (10,465 | )     
|                                                             |                                                                                   | Other                                      |                                                        |                                                      |        |                              |        |        | 9       |       
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|                                                             |                                                                                   |                                            |                                                        | Net cash used in investing activities                |         |                              | (6,153 | )      |         |        | (10,456 | )
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|Cash flows from financing activities                         |                                                                                   |                                            |                                                        |                                                      |         |                              |        |       
|                                                             |                                                                                   | Proceeds from issuance of debt             |                                                        |                                                      | 12,500  |                              |        |        | 15,000  |       
|                                                             |                                                                                   | Repayment of short-term and long-term debt |                                                        |                                                      | (16,598 | )                            |        |        | (16,030 | )     
|                                                             |                                                                                   | Proceeds from issuance of common stock     |                                                        |                                                      | 10      |                              |        |        | 1,546   |       
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|                                                             |                                                                                   |                                            |                                                        | Net cash (used in) provided by financing activities  |         |                              | (4,088 | )      |         |        | 516     |  
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|Effect of exchange rate changes on cash and cash equivalents |                                                                                   |                                            | 468                                                    |                                                      |         |                              | (1,145 | )     
|                                                             |                                                                                   |                                            |                                                        | Net increase (decrease) in cash and cash equivalents |         |                              | 1,749  |        |         |        | (3,504  | )
|Cash and cash equivalents at the beginning of year           |                                                                                   |                                            | 11,414                                                 |                                                      |         |                              | 7,789  |       
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|Cash
and cash equivalents at the end of period               |                                                                                   | $                                          | 13,163                                                 |                                                      |         | $                            | 4,285  |       
|                                                             |                                                                                   |                                            |                                                        |                                                      |         |                              |        |        |         |        |         |  
|Supplemental cash flow disclosures:                          |                                                                                   |                                            |                                                        |                                                      |         |                              |        |       
|                                                             | Cash paid during the year for:                                                    |                                            |                                                        |                                                      |         |                              |        |        |        
|                                                             |                                                                                   |                                            | Interest                                               |                                                      | $       | 196                          |        |        | $       | 272    |        
|                                                             |                                                                                   |                                            | Taxes                                                  |                                                      | $       | 707                          |        |        | $       | 906    |        

See accompanying notes to condensed consolidated financial statements.

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OCULAR SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)




Note 1  Basis of Preparation

The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. Accordingly, they do not contain all of the
information and footnotes required by accounting principles generally accepted
in the United States of America for complete financial statements. The
accompanying unaudited condensed consolidated financial statements have been
prepared on the same basis as the audited consolidated financial statements at
and for the year ended December 31, 2002 and, in the opinion of management,
include all adjustments, consisting only of normal recurring adjustments,
necessary for the fair presentation of the companys financial condition as of
March 31, 2003 and the results of the companys operations
and cash flows for the three-month
periods ended March 31, 2003 and 2002, respectively. These
unaudited condensed consolidated financial statements should be read in
conjunction with the companys audited consolidated financial statements as of
December 31, 2002 and 2001 and for each of the three years ended December 31,
2002, including notes thereto, included in the companys Annual Report on Form
10-K for the year ended December 31, 2002. Operating results for the
three-month period ended March 31, 2003 are not necessarily indicative of the
results that may be expected for the year ending December 31, 2003.

All amounts, unless otherwise indicated are in U.S. dollars.

Note 2  New Accounting Standards

The Financial Accounting Standards Board (FASB) issued Statement of
Financial Accounting Standards (SFAS) No. 146, Accounting for Costs Associated
with Exit or Disposal Activities in June 2002. SFAS No. 146 addresses
accounting and reporting for costs associated with exit and disposal activities
and supercedes EITF No. 94-3, Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring). SFAS No. 146 requires that a liability for
a cost associated with an exit or disposal activity be recognized when the
liability is incurred, as defined by the Statement. Under EITF 94-3, an exit
cost was recognized at the date an entity committed to an exit plan.
Additionally, SFAS No. 146 provides that exit and disposal costs should be
measured at fair value and that the associated liability will be adjusted for
changes in estimated cash flows. The company adopted SFAS No. 146 effective
January 1, 2003.

In November 2002, the FASB issued Interpretation No. 45, Guarantors
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness to Others, an interpretation of FASB Statements No.
5, 57 and 107 and a rescission of FASB Interpretation No. 34. This
interpretation elaborates on the disclosures to be made by guarantor in its
interim and annual financial statements about its obligations under guarantees
issued. The interpretation also clarifies that a guarantor is required to
recognize, at inception of a guarantee, a liability for the fair value of the
obligation undertaken. The initial recognition and measurement provisions of
the interpretation are applicable to guarantees issued or modified after
December 31, 2002 and have not had a material effect on the companys financial
statements.

In December 2002, the FASB issued SFAS No. 148 Accounting for Stock-Based
Compensation  Transition and Disclosure, which amends SFAS No. 123,
Accounting for Stock-Based Compensation. SFAS 148 provides alternative
methods of transition for a voluntary change to the fair value method of
accounting for stock-based compensation. In addition, SFAS No. 148 amends the
disclosure requirements of SFAS No. 123 to require prominent disclosure in both
annual and interim financial statements about the method of accounting for
stock-based employee compensation and the effect of the method used on reported
results. The company has adopted SFAS No. 148 effective January 1, 2003 and the
company has made the required disclosure requirements under Critical Accounting
Policies of the Management discussion and analysis of financial conditions and
results of operations section of this Form 10-Q.

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Note 3  Balance Sheet Items

Inventories consisted of the following (in thousands):

|                |  |           |        |              |  |   |        | 
|--------------- |  | --------- | ------ | ------------ |  | - | ------ | 
|                |  | March 31, |        | December 31,
|                |  | 2003      |        | 2002        
|                |  |           |        |             
|Raw materials   |  | $         | 7,190  |              |  | $ | 6,339  | 
|Work in process |  |           | 2,945  |              |  |   | 2,376  | 
|Finished goods  |  |           | 68,289 |              |  |   | 65,800 | 
|                |  |           |        |              |  |   |        | 
|                |  | $         | 78,424 |              |  | $ | 74,515 | 
|                |  |           |        |              |  |   |        | 

Prepaid expenses and other current assets consisted of the following (in
thousands):

|                             |  |           |        |              |  |   |        | 
|---------------------------- |  | --------- | ------ | ------------ |  | - | ------ | 
|                             |  | March 31, |        | December 31,
|                             |  | 2003      |        | 2002        
|                             |  |           |        |             
|Refundable income taxes      |  | $         | 16,026 |              |  | $ | 16,131 | 
|Deferred income taxes        |  |           | 2,679  |              |  |   | 2,679  | 
|Value added taxes receivable |  |           | 6,153  |              |  |   | 3,079  | 
|Prepaid insurance            |  |           | 1,911  |              |  |   | 1,709  | 
|Other prepaid expenses       |  |           | 2,397  |              |  |   | 2,567  | 
|Other current assets         |  |           | 1,151  |              |  |   | 2,407  | 
|                             |  |           |        |              |  |   |        | 
|                             |  | $         | 30,317 |              |  | $ | 28,572 | 
|                             |  |           |        |              |  |   |        | 

Accrued liabilities consisted of the following (in thousands):

|                                             |  |           |        |              |  |   |        | 
|-------------------------------------------- |  | --------- | ------ | ------------ |  | - | ------ | 
|                                             |  | March 31, |        | December 31,
|                                             |  | 2003      |        | 2002        
|                                             |  |           |        |             
|Accrued expenses                             |  | $         | 23,126 |              |  | $ | 19,419 | 
|Restructuring and acquisition accruals       |  |           | 16,344 |              |  |   | 17,287 | 
|Accrued cooperative merchandising allowances |  |           | 8,815  |              |  |   | 9,896  | 
|Income taxes payable                         |  |           | 9,913  |              |  |   | 9,236  | 
|                                             |  |           |        |              |  |   |        | 
|                                             |  | $         | 58,198 |              |  | $ | 55,838 | 
|                                             |  |           |        |              |  |   |        | 

Note 4  Comprehensive Income

Comprehensive income consisted of the
following (in thousands):

|                     |                        |   |                              |     |      |   |        |        |  
|-------------------- | ---------------------- | - | ---------------------------- | --- | ---- | - | ------ | ------ | -
|                     |                        |   | Three months ended March 31,
|                     |                        |   | 2003                         |     | 2002
|                     |                        |   |                              |     |     
|Net income           |                        | $ | 5,918                        |     |      | $ | 10,093 |       
|Foreign currency     |                        |   |                              |     |      |   |        |       
|                     | translation adjustment |   |                              | 114 |      |   |        | (1,593 | )
|                     |                        |   |                              |     |      |   |        |       
|Comprehensive income |                        | $ | 6,032                        |     |      | $ | 8,500  |       
|                     |                        |   |                              |     |      |   |        |       

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Note 5  Goodwill and Other Intangible Assets

Goodwill and other intangible assets (gross) consisted of the following
(in thousands):

|                                              |  |           |        |              |  |   |        | 
|--------------------------------------------- |  | --------- | ------ | ------------ |  | - | ------ | 
|                                              |  | March 31, |        | December 31,
|                                              |  | 2003      |        | 2002        
|                                              |  |           |        |             
|Goodwill                                      |  | $         | 40,415 |              |  | $ | 39,814 | 
|Intangible assets subject to amortization     |  |           | 22,207 |              |  |   | 22,150 | 
|Intangible assets not subject to amortization |  |           | 3,630  |              |  |   | 3,630  | 
|                                              |  |           |        |              |  |   |        | 
|                                              |  | $         | 66,252 |              |  | $ | 65,594 | 
|                                              |  |           |        |              |  |   |        | 

Accumulated amortization consisted of the following (in thousands):

|                                              |  |           |        |              |  |   |       | 
|--------------------------------------------- |  | --------- | ------ | ------------ |  | - | ----- | 
|                                              |  | March 31, |        | December 31,
|                                              |  | 2003      |        | 2002        
|                                              |  |           |        |             
|Goodwill                                      |  | $         | 2,081  |              |  | $ | 2,067 | 
|Intangible assets subject to amortization     |  |           | 7,672  |              |  |   | 7,237 | 
|Intangible assets not subject to amortization |  |           | 475    |              |  |   | 475   | 
|                                              |  |           |        |              |  |   |       | 
|                                              |  | $         | 10,228 |              |  | $ | 9,779 | 
|                                              |  |           |        |              |  |   |       | 

Goodwill and other intangible assets, net of accumulated amortization,
consisted of the following (in thousands):

|                                              |  |           |        |              |  |   |        | 
|--------------------------------------------- |  | --------- | ------ | ------------ |  | - | ------ | 
|                                              |  | March 31, |        | December 31,
|                                              |  | 2003      |        | 2002        
|                                              |  |           |        |             
|Goodwill                                      |  | $         | 38,334 |              |  | $ | 37,747 | 
|Intangible assets subject to amortization     |  |           | 14,535 |              |  |   | 14,913 | 
|Intangible assets not subject to amortization |  |           | 3,155  |              |  |   | 3,155  | 
|                                              |  |           |        |              |  |   |        | 
|                                              |  | $         | 56,024 |              |  | $ | 55,815 | 
|                                              |  |           |        |              |  |   |        | 

The total weighted average amortization period of intangible assets subject to
amortization is approximately 11 years.

Intangible assets subject to amortization consist primarily of marketing
rights, patents, customer lists, core technology and trade names. Amortization
expense for intangible assets subject to amortization amounted to approximately
$0.5 million and $0.4 million for the three months ended March 31, 2003 and
2002, respectively.

Amortization expense for each of the five succeeding fiscal years will
amount to approximately (in thousands):

|                         |  |              |       | 
|------------------------ |  | ------------ | ----- | 
|                         |  | Amortization
|Year ending December 31, |  | expense     
|                         |  |             
|2003                     |  | $            | 2,100 | 
|2004                     |  |              | 2,100 | 
|2005                     |  |              | 2,000 | 
|2006                     |  |              | 2,000 | 
|2007                     |  |              | 1,500 | 
|                         |  |              |       | 
|Total                    |  | $            | 9,700 | 
|                         |  |              |       | 

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Note 6  Net Income Per Share

In accordance with SFAS No. 128, Earnings Per Share, basic earnings per
share is calculated using the weighted average number of common shares
outstanding during the period. Diluted earnings per share is calculated using
the weighted average number of common shares and dilutive potential common
shares outstanding during the period. Dilutive potential common shares
represent shares issuable upon the exercise of outstanding options and are
calculated using the treasury stock method.

Options to purchase 3,046,374 and 801,450 shares of the companys common
stock were not included in the computation of diluted earnings per share
because their exercise prices were greater than the average market price of the
companys common stock of $13.66 and $26.10 per share for the three-month ended
March 31, 2003 and 2002 respectively.

Note 7  Acquisitions

Acquisition of the Contact Lens
Business of Essilor

On February 12, 2001, the company acquired the contact lens business of
Essilor International (Compagnie Generale dOptique) S. A. (Essilor). The
company acquired Essilors sales and distribution assets of the contact lens
business in Europe and the United States and manufacturing facilities in
France, the United Kingdom and the United States. The primary reasons for this
acquisition were to expand the companys presence in Europe and to increase its
breadth of product offerings.

Included in the liabilities assumed are accruals for costs associated with
exiting certain activities and facilities of the acquired Essilor operations
that were considered duplicative. This includes accruals for severance costs
related to workforce reductions across all functions and exit costs associated
with exiting certain facilities, dismantling equipment and other miscellaneous
exit costs. Details of the exit costs and severance costs paid and charged
against the accrual are presented in the following table (in thousands):

|                    |                   |   |               |     |          |   |             |   |             |   |           |    |               |   |       |     | 
|------------------- | ----------------- | - | ------------- | --- | -------- | - | ----------- | - | ----------- | - | --------- | -- | ------------- | - | ----- | --- | 
|                    |                   |   | Accrual as of |     |          |   |             |   |             |   |           |    | Accrual as of
|                    |                   |   | December 31,  |     |          |   |             |   | Translation |   | March 31,
|                    |                   |   | 2002          |     | Payments |   | Adjustments |   | 2003       
|                    |                   |   |               |     |          |   |             |   |            
|Severance costs     |                   | $ | 4,555         |     |          | $ | (745        | ) |             | $ | 137       |    |               | $ | 3,947 |    
|Facility costs      |                   |   | 783           |     |          |   | (74         | ) |             |   | 28        |    |               |   | 737   |    
|Equipment and       |                   |   |               |     |          |   |             |   |             |   |           |    |               |   |       |    
|                    | dismantling costs |   |               | 278 |          |   |             |  |             |   |           | 11 |               |   |       | 289 | 
|Miscellaneous costs |                   |   | 102           |     |          |   | (13         | ) |             |   | 4         |    |               |   | 93    |    
|                    |                   |   |               |     |          |   |             |   |             |   |           |    |               |   |       |    
|Total               |                   | $ | 5,718         |     |          | $ | (832        | ) |             | $ | 180       |    |               | $ | 5,066 |    
|                    |                   |   |               |     |          |   |             |   |             |   |           |    |               |   |       |    

Acquisition of Assets of Seiko Contactlens, Inc.

On March 11, 2002, the company entered into an agreement to acquire
certain assets of Seiko Contactlens, Inc. (Seiko). The purchase was completed
on April 1, 2002. The primary reasons for this acquisition were to strengthen
the companys presence and enhance its competitive positioning
in Japan. As part of the acquisition, the company hired 74 Seiko sales and
administrative personnel. Seiko had been the companys distributor in Japan.

The company has accounted for the acquisition using the purchase method.
Accordingly, the operating results of Seiko have been included in its operating
results from April 1, 2002.



| |                                                              
| | -------------------------------------------------------------
| | The purchase
price consisted of the following (in thousands):

|                                |  |   |        | 
|------------------------------- |  | - | ------ | 
|Exchange of accounts receivable |  | $ | 11,215 | 
|Cash                            |  |   | 8,823  | 
|Acquisition costs               |  |   | 1,580  | 
|                                |  |   |        | 
|                                |  | $ | 21,618 | 
|                                |  |   |        | 

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The accounts receivable represented amounts owed to the company from Seiko
and exchanged as part of the acquisition.

The company evaluated the assets and liabilities acquired and has
allocated the $21.6 million purchase price based on this evaluation, which is
subject to change. The purchase price allocation consisted of the
following (in thousands):

|                    |  |   |        |  
|------------------- |  | - | ------ | -
|Goodwill            |  | $ | 6,452  |  
|Customer lists      |  |   | 3,540  |  
|Favorable contracts |  |   | 330    |  
|Inventory           |  |   | 9,489  |  
|Accounts receivable |  |   | 3,909  |  
|Liabilities assumed |  |   | (2,102 | )
|                    |  |   |        |  
|                    |  | $ | 21,618 |  
|                    |  |   |        |  

Goodwill has not been subject to amortization due to its infinite life.
Customer lists and favorable contracts are included as components of intangible
assets and are being amortized on a straight-line basis over their useful lives
as listed in the table below:

|                    |  |          |  | 
|------------------- |  | -------- |  | 
|                    |  | Useful  
|Intangible Assets   |  | Life    
|                    |  |         
|Customer lists      |  | 10 years
|Favorable contracts |  | 3 years 

The total weighted average amortization period of intangible assets
subject to amortization is approximately 8 years.

Included in the liabilities assumed are accruals for costs associated with
exiting certain activities and facilities of the acquired Seiko operations that
were considered duplicative. This includes accruals for severance costs related
to workforce reductions across all functions and exit costs associated with
exiting certain activities and facilities. Details of the severance and exit
costs paid and charged against the accrual are presented in the following table
(in thousands):

|                              |  |                   |       |          |  |             |      |             |  |                |    |               |  |   |    |  |  |   |       | 
|----------------------------- |  | ----------------- | ----- | -------- |  | ----------- | ---- | ----------- |  | -------------- | -- | ------------- |  | - | -- |  |  | - | ----- | 
|                              |  | Accrual as of     |       |          |  |             |      | Translation |  | Accrual        |    | Accrual as of
|                              |  | December 31, 2002 |       | Payments |  | Adjustments |      | Adjustment  |  | March 31, 2003
|                              |  |                   |       |          |  |             |      |             |  |               
|Severance costs               |  | $                 | 46    |          |  | $           | (76  | )           |  | $              |   |               |  | $ | 52 |  |  | $ | 22    | 
|Facility and other
exit costs |  |                   | 1,906 |          |  |             | (106 | )           |  |                | 15 |               |  |   | 16 |  |  |   | 1,831 | 
|                              |  |                   |       |          |  |             |      |             |  |                |    |               |  |   |    |  |  |   |       | 
|Total                         |  | $                 | 1,952 |          |  | $           | (182 | )           |  | $              | 15 |               |  | $ | 68 |  |  | $ | 1,853 | 
|                              |  |                   |       |          |  |             |      |             |  |                |    |               |  |   |    |  |  |   |       | 

Management began formulating the plans to exit certain activities and
facilities of the acquired Seiko operations at the time of the acquisition and
expects to complete all actions under such plans by December 31, 2003.

Note 8  Restructuring and related expenses

During the fourth quarter of 2002, the company accelerated the
implementation of its second-generation manufacturing process throughout its
high volume product lines. Given the lower labor and space requirements of
these processes, the company will consolidate its manufacturing operations into
a smaller total plant structure. The initiative will allow the company to meet
volume production goals in substantially less space with lower manufacturing
overhead. The company believes that this initiative will result in an annual
cost savings of $40 million by 2005. The company expects the initiative to be
completed by 2004 and cost a total of approximately
$50.0 million, $24.7 million of
which is non-cash.

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As a result of this initiative, the company recorded a restructuring
charge of approximately $34.5 million in the fourth quarter of 2002. Of the
$34.5 million, approximately $24.7 million related to impairment of property
and equipment, $4.7 million related to employee severance and benefit costs,
$4.4 million related to leased facilities that will be abandoned within one
year and the remaining $0.7 million relates to miscellaneous costs, such as
professional fees related to the initiative.

During
the first quarter of 2003, the company recorded additional charges of approximately $1.2 million, all of which were paid in the quarter. Of the
$1.2 million, approximately $0.9 million related to severance
and other salary-related and benefit
costs, and $0.3 million related to other miscellaneous costs.

For leased facilities that will be abandoned and subleased, the lease
costs represent future lease payments subsequent to abandonment less estimated
sublease income. For owned property and equipment, the impairment loss
recognized was based on the estimated fair value of the equipment.

The following table summarizes the restructuring and related expense
accrual activity from the initiation of the companys activities (in
thousands):

|                                        |  |               |       |             |  |       |       |       |  |   |     |   |  |   |       |  
|--------------------------------------- |  | ------------- | ----- | ----------- |  | ----- | ----- | ----- |  | - | --- | - |  | - | ----- | -
|                                        |  |               |       |             |  | Lease |       |       |  |   |     |   |  |  
|                                        |  | Severance and |       | Payments
on |  |       |       |       |  |   |     |  
|                                        |  | Benefits      |       | Facilities  |  | Other |       | Total
|                                        |  |               |       |             |  |       |       |      
|Balance of accrual at December 31, 2002 |  | $             | 4,720 |             |  | $     | 4,397 |       |  | $ | 500 |   |  | $ | 9,617 |  
|Payments                                |  |               | (112  | )           |  |       |      |       |  |   | (80 | ) |  |   | (192  | )
|                                        |  |               |       |             |  |       |       |       |  |   |     |   |  |   |       |  
|Balance of accural at March 31, 2003    |  | $             | 4,608 |             |  | $     | 4,397 |       |  | $ | 420 |   |  | $ | 9,425 |  
|                                        |  |               |       |             |  |       |       |       |  |   |     |   |  |   |       |  

Note 9  Credit Facility

On April 16, 2002, the company completed a new $50 million credit facility
with two banks. Revolving loans under this facility mature on April 16, 2005,
and bear interest at 0.50% below one of the banks prime rate or 1.00% to 1.50%
above the eurodollar rate depending on its ratio of total funded debt to
earnings before interest and taxes plus non-cash charges. The facility provides
an option to convert any outstanding revolving loans not to exceed $40 million
at the maturity date to a four-year term loan. The term loan, once repaid, may
not be reborrowed. This credit agreement contains covenants, which, among other
things, require the company to maintain certain financial ratios. As of March
31, 2003, there were $24.0 million of revolving loans outstanding under this
credit agreement and the interest rate was 2.30% and 3.75% on loan balances of
$22.0 million and $2.0 million, respectively. This revolving loan is included
in long-term liabilities in the accompanying balance sheet as of March 31, 2003
based on the companys ability and intent to defer payment beyond March 31,
2004. Borrowings under this agreement are secured by a pledge of 100% of the
outstanding common stock of Ocular Sciences Puerto Rico and Sunsoft, Inc. and
65% of the outstanding common stock of its Barbados and Canadian subsidiaries.
As of March 31, 2003, the company was in compliance with its covenants.

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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS




The following discussion should be read in conjunction with the unaudited
condensed consolidated financial statements and notes thereto included in Part
I  Item 1 of this Quarterly Report and the audited consolidated financial
statements and notes thereto and Managements Discussion and Analysis of
Financial Condition and Results of Operations contained in our Annual Report on
Form 10-K for the year ended December 31, 2002.

This Quarterly Report on Form 10-Q contains forward-looking statements
within the meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and Section 27A of the Securities Act of 1933, as amended. Such
statements relate to our future performance and plans, results of operations,
capital expenditures, acquisitions and operating improvements and costs. You
can identify forward-looking statements by the use of forward-looking
terminology such as believes, expects, may, will, should, seeks,
approximately, intends, plans, pro forma, estimates or anticipates
or the negative of these words and phrases or similar words or phrases. You can
also identify forward-looking statements by discussions of strategy, plans or
intentions. Forward-looking statements involve numerous risks and uncertainties
and you should not rely upon them as predictions of future events. There is no
assurance that the events or circumstances reflected in forward-looking
statements will be achieved or will occur. Forward-looking statements are
necessarily dependent on assumptions, data, or methods that may be incorrect or
imprecise and we may not be able to realize them. Factors that could cause
actual results and future events to differ materially from those set forth or
contemplated in the forward-looking statements include risks associated with
the overall economic environment, the integration of the Essilor and Seiko
Contactlens businesses, the impact of competitive products and pricing, product
demand both domestically and overseas, market receptiveness to various product
launches, higher than expected employee turnover, extended manufacturing
difficulties, customer bad debts, currency fluctuations, other risks of doing
business internationally and the other risks detailed in the sections entitled
Item 1, Business  Risk Factors, and Item 7, Managements Discussion and
Analysis of Financial Condition and Results of Operations and elsewhere in our
Annual Report on Form 10-K for the year ended December 31, 2002, and from time
to time our other reports filed with the Securities and Exchange Commission. We
caution you not to place undue reliance on forward-looking statements, which
reflect our analysis only and speak as of the date of this report or as of the
dates indicated in the statements. Unless the context otherwise requires, the
terms we, us, and our refer to Ocular Sciences, Inc. and its
subsidiaries.

Acquisition

On April 1, 2002, we acquired certain assets of Seiko Contactlens, Inc.
(Seiko). The purchase price was $21.6 million. Seiko had been our distributor
in Japan. We have accounted for the acquisition under the purchase method.
Accordingly, the operating results of Seiko have been included in our operating
results from April 1, 2002. The $21.6 million purchase price was comprised of
an exchange of accounts receivable of $11.2 million, cash of $8.8 million and
acquisition costs of $1.6 million. There were no contingent payments,
pre-acquisition contingencies or other commitments specified in the acquisition
agreement.

Critical Accounting Policies

Our critical accounting policies are as follows:



| |  |  | revenue recognition;                                      
| | - |  | ----------------------------------------------------------
|
| |  |  | estimating valuation allowances;                          
|
| |  |  | accounting for income taxes;                              
|
| |  |  | valuation of long-lived and intangible assets and goodwill
|
| |  |  | estimates inherent in purchase accounting; and            
|
| |  |  | stock-based compensation                                  

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Revenue Recognition

Revenue is recognized based on the terms of sale with the customer,
generally upon product shipment. We have established programs that, under
specified conditions, enable our customers to return product. We establish
reserves for estimated returns and allowances at the time revenues are
recognized. In addition, accruals for customer discounts and rebates are
recorded when revenues are recognized. Amounts billed to customers in sale
transactions related to shipping and handling are classified as revenue.

Estimating Valuation Allowances

The preparation of financial statements requires management to make
estimates and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.

We specifically analyze the aging of accounts receivable and historical
bad debts, customer concentrations, customer credit-worthiness, current
economic trends and changes in customer payment terms and sales returns when
evaluating the adequacy of the allowance for doubtful accounts and sales
returns in any accounting period. Material differences may result in the amount
and timing of revenue and/or expenses for any period if different judgments had
been made or different estimates utilized.

We sell our products to a diverse group of optometrists, optical
retailers, optical product distributors and ophthalmologists, and therefore the
concentration of credit risk with respect to accounts receivable is limited due
to the large number and diversity of customers across broad geographic areas.
Accounts receivable from customers are uncollateralized. To reduce credit risk,
we perform ongoing credit evaluations of significant customers respective
financial conditions. We establish an allowance for doubtful accounts based
upon factors surrounding the credit risk of specific customers, historical
trends and other information.

We assess the need for reserves on inventory generally based on monthly
forward projections of sales of products that are updated periodically.
Inventories are recorded at the lower of cost (first-in, first-out method) or
market. Cost includes material, labor and applicable factory overhead. The
reported value of our inventory includes saleable products, promotional
products, raw materials and componentry that will be sold or used in future
periods. Provision for potentially obsolete or slow moving inventory is made
based upon our analysis of inventory levels and forecasted sales. Once
inventory is reserved, the reserve can only be relieved by the subsequent sale
or disposal of the inventory.

Accounting for Income Taxes

Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the future tax effects
attributable to differences between financial statement carrying amounts of
existing assets and liabilities and their respective tax bases. Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply
to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that
includes the enactment date.

In preparing our consolidated financial statements, we are required to
estimate our income taxes in each of the jurisdictions in which we operate.
This process involves estimating actual current tax liability together with
assessing temporary differences resulting from differing treatment of items for
tax and accounting purposes. These differences result in deferred tax assets
and liabilities, which are included within the consolidated balance sheet.
Significant management judgment is required in determining the provision for
income taxes and deferred tax assets and liabilities. In the event that actual
results differ from these estimates or we adjust these estimates in future
periods, our financial position and results of operations could be materially
impacted.

Valuation of Long-Lived and Intangible Assets and Goodwill

We periodically review long-lived assets and certain identifiable
intangible assets for impairment in accordance with Statement of Financial
Accounting Standards (SFAS) No. 144, Accounting for the Impairment or Disposal
of Long-lived Assets. Goodwill and certain intangible assets, which are not
subject to amortization, are periodically reviewed for impairment in accordance
with SFAS No. 142, Goodwill and Other Intangible Assets.

For assets to be held and used, including acquired intangibles, we
initiate our review whenever events or changes in circumstances indicate that
the carrying amount of goodwill and intangible assets may not be recoverable.
Recoverability of an asset is measured by comparison of its carrying amount to
the expected future undiscounted cash flows (without interest charges) that the
asset is

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expected to generate. Any impairment to be recognized is measured by the amount
by which the carrying amount of the asset exceeds its fair market value.
Significant management judgment is required in this process.

In January 2002, SFAS No. 142, Goodwill and Other Intangible Assets
became effective and as a result, we have ceased to amortize goodwill and
assembled workforce beginning January 1, 2002. As of March 31, 2003,
unamortized goodwill and assembled workforce was approximately $41 million. In
lieu of amortization, we were required to perform an initial impairment review
of goodwill in 2002 and an annual impairment review thereafter. We have
completed the first step of SFAS No. 142 transitional goodwill impairment test
and have determined that as of January 1, 2002 our goodwill had not been
impaired. During the fourth quarter of 2002, we performed our annual impairment
test and concluded that there is no impairment of our goodwill. In the future,
we will perform the annual impairment test required by SFAS No. 142 in the
fourth quarter of each year. We cannot assure you that a material impairment
charge will not be recorded in the future.

Estimates Inherent in Purchase Accounting

Purchase accounting requires extensive use of accounting estimates and
judgments to allocate the purchase price to the fair value of the assets
purchased and liabilities assumed. In our recording of the acquisitions of the
assets of Essilor and Seiko Contactlens, values were assigned to identifiable
intangible assets based on managements forecasts and projections that include
assumptions related to future revenues and cash flows generated from the
acquired assets.

Stock-Based Compensation

We account for stock-based compensation using methods prescribed in
Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock
Issued to Employees, and related Interpretations. We have adopted the
disclosure-only provisions of SFAS No. 123 Accounting for Stock-Based
Compensation.

In accordance with SFAS No. 123, as amended by SFAS No. 148, Accounting
for Stock-Based Compensation-Transition and Disclosure, we have provided,
below, the pro forma disclosures of the effect on net income and earnings per
share as if SFAS No. 123 had been applied in measuring compensation expense for
all periods presented.

The following table illustrates, pursuant to SFAS No. 123, as amended by
SFAS No. 148, the effect on net income and related net income per share for the
first quarter of 2003 and 2002, had compensation cost for stock-based
compensation plans been determined based upon the fair value method prescribed
under SFAS No. 123:

|                                                                                                                                    |             |   |                    |       |      |   |        |       | 
|----------------------------------------------------------------------------------------------------------------------------------- | ----------- | - | ------------------ | ----- | ---- | - | ------ | ----- | 
|                                                                                                                                    |             |   | Three Months ended
|                                                                                                                                    |             |   |                   
|                                                                                                                                    |             |   | March 31,         
|                                                                                                                                    |             |   |                   
|                                                                                                                                    |             |   | 2003               |       | 2002
|                                                                                                                                    |             |   |                    |       |     
|Net income:                                                                                                                         |             |   |                    |       |      |   |        |      
|As reported                                                                                                                         |             | $ | 5,918              |       |      | $ | 10,093 |      
|Total stock-based employee compensation expense
determined under fair value based method for
all awards, net of related tax effects |             |   | 673                |       |      |   | 1,498  |      
|                                                                                                                                    | Pro forma   |   | $                  | 5,245 |      |   | $      | 8,595 | 
|Net income per common share (basic):                                                                                                |             |   |                    |       |      |   |        |      
|                                                                                                                                    | As reported |   | $                  | 0.25  |      |   | $      | 0.43  | 
|                                                                                                                                    | Pro forma   |   |                    | 0.22  |      |   |        | 0.37  | 
|Net income per common share (diluted):                                                                                              |             |   |                    |       |      |   |        |      
|                                                                                                                                    | As reported |   | $                  | 0.25  |      |   | $      | 0.41  | 
|                                                                                                                                    | Pro forma   |   |                    | 0.22  |      |   |        | 0.35  | 

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##### Table of Contents



New Accounting Pronouncements Adopted

See Note 2 to Notes to Condensed Consolidated Financial Statements which
are incorporated herein by reference.

Results of Operations

The following table summarizes certain items on the consolidated
statements of operations as a percentage of net sales:

|                                   |                            |  |                    |      |      |  |       |      |  
|---------------------------------- | -------------------------- |  | ------------------ | ---- | ---- |  | ----- | ---- | -
|                                   |                            |  | Three months ended
|                                   |                            |  | March 31,         
|                                   |                            |  |                   
|                                   |                            |  | 2003               |      | 2002
|                                   |                            |  |                    |      |     
|Net sales                          |                            |  | 100.0              | %    |      |  | 100.0 | %   
|Cost of sales                      |                            |  | 47.0               | %    |      |  | 44.9  | %   
|                                   |                            |  |                    |      |      |  |       |     
|                                   | Gross profit               |  |                    | 53.0 | %    |  |       | 55.1 | %
|Selling and marketing expense      |                            |  | 21.7               | %    |      |  | 16.7  | %   
|General and administrative expense |                            |  | 16.9               | %    |      |  | 16.5  | %   
|Research and development expense   |                            |  | 2.4                | %    |      |  | 1.7   | %   
|Restructuring and related expenses |                            |  | 1.7                | %    |      |  | 0.0   | %   
|                                   |                            |  |                    |      |      |  |       |     
|                                   | Income from operations     |  |                    | 10.4 | %    |  |       | 20.2 | %
|Interest and other income, net     |                            |  | 0.0                | %    |      |  | 0.0   | %   
|                                   |                            |  |                    |      |      |  |       |     
|                                   | Income before income taxes |  |                    | 10.4 | %    |  |       | 20.2 | %
|Income taxes                       |                            |  | -2.0               | %    |      |  | -3.6  | %   
|                                   |                            |  |                    |      |      |  |       |     
|                                   | Net income                 |  |                    | 8.4  | %    |  |       | 16.6 | %
|                                   |                            |  |                    |      |      |  |       |     

Net Sales

Net sales were $70.7 million in the first quarter of 2003, an increase of
16.2% from the first quarter of 2002. The increase in the first quarter of 2003
was primarily due to additional sales generated by the Seiko acquisition and
growth in international sales.

U.S.
sales were $32.2 million in the first quarter of 2003, a 3.2% decrease
from the first quarter of 2002. This decrease is reflective of the current U.S
market.

International
sales were $38.5 million, an increase of 39.7% from the
first quarter of 2002. The increase in international net sales was due
primarily to the strengthening of our position in Europe, from the Essilor
acquisition, and our increased distribution network in Japan, which resulted
from the Seiko acquisition. Additionally, we had a favorable foreign currency
exchange impact of approximately $4.6 million.

Gross Profit

Gross margins were $37.5 million and $33.5 million in the first quarter of
2003 and 2002, respectively. Gross margins, as a percentage of net sales, were
53.0% and 55.1% for the first quarter of 2003 and 2002 respectively. The
decrease in the 2003 gross margin was primarily due to unfavorable product mix,
declining average selling prices and additional inventory reserves. The
unfavorable mix resulted primarily from an increase in sales of daily
disposable products at gross margins lower than other products.

Selling and Marketing Expenses

Sales and marketing expenses were $15.3 million in the first quarter of
2003, an increase of 51.2% from the first quarter of 2002. As a percentage of
net sales, selling and marketing expenses were 21.7% and 16.7% in the first
quarter of 2003 and 2002, respectively. The increase in sales and marketing
expenses were due primarily to the additional sales expenses in Japan as a
result of the Seiko acquisition and increases in expenditures related to new
product launches and promotional programs, primarily in the U.S.

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##### Table of Contents



General and Administrative Expenses

General and administrative expenses were $11.9 million in the first
quarter of 2003, an increase of 18.8% from the first quarter of 2002. As a
percentage of net sales, general and administrative expenses were 16.9% and
16.5% for the first quarter of 2003 and 2002, respectively. The increase in
general and administrative expenses in the first quarter of 2003 was primarily
due to increased distribution costs as a result of higher sales.

Research and Development Expenses

Research and development expenses were $1.7 million, an increase of 68.6%
from the first quarter of 2002. As a percentage of net sales, research and
development expenses were 2.4% and 1.7% in the first quarter of 2003 and 2002,
respectively. The increase in research and development expense in the first
quarter of 2003 was primarily due to the timing of new product development
projects.

Restructuring and Related Expenses

During the fourth quarter of 2002, we accelerated the implementation of
our second-generation manufacturing process throughout our high volume product
lines. Given the lower labor and space requirements of these processes, we will
consolidate our manufacturing operations into a smaller total plant structure.
The initiative will allow us to meet volume production goals in substantially
less space with lower manufacturing overhead. We believe that this initiative
will result in an annual cost savings of $40.0 million by 2005. We expect the
initiative to be completed by 2004 and cost a total of approximately
$50.0
million, $24.7 million of which is non-cash.

As a result of this initiative, we recorded a restructuring charge of
approximately $34.5 million in 2002. Of the $34.5 million, approximately $24.7
million relates to impairment of property and equipment, $4.7 million relates
to employee severance and benefit costs, $4.4 million relates to leased
facilities that will be abandoned within one year and the remaining $0.7
million relates to miscellaneous costs, such as professional fees related to
the initiative.

For leased facilities that will be abandoned and subleased, the lease
costs represent future lease payments subsequent to abandonment less estimated
sublease income. For owned property and equipment, the impairment loss
recognized was based on the estimated fair value of the equipment.

During the first quarter of 2003, we recorded expenses associated with the
manufacturing restructuring of approximately $1.2 million. Of the $1.2 million,
approximately $0.9 million related to severance and other salary
related and benefit costs, and $0.3
million related to miscellaneous costs.

Interest and Other Income, Net

Interest and other income were nominal for the first quarter of 2003 and
2002, respectively. Interest and other income primarily consist of foreign
exchange gains and losses and net interest expense. These items were
essentially flat on a comparative basis.

Provision for Income Taxes

Income taxes were $1.4 million and $2.2 million for the first quarter of
2003 and 2002, respectively. Our effective tax rates were 19.5% and 18.0% for
the first quarter of 2003 and 2002, respectively. We anticipate that our 2003
effective tax rate, excluding the effects of restructuring and
related expenses,
will be 19.5%.

Liquidity and Capital Resources

Our capital requirements have generally been funded from operations, cash
and investments on hand, and debt borrowings. Our cash and cash equivalents,
which totaled $13.2 million at March 31, 2003, are invested in a diversified
portfolio of financial instruments, including money market instruments and
government or government agency securities and other debt securities issued by
financial institutions and other issuers with strong credit ratings. By policy,
the amount of credit exposure to any one institution is limited. Investments
are generally not collateralized and primarily mature within three years.

Sources and Uses of Cash

Cash and cash equivalents at March 31, 2003 of $13.2 million increased
$1.8 million from a December 31, 2002 balance of $11.4 million. Working capital
increased to $106.9 million in March 31, 2003 from $104.7 million in December
31, 2002.

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##### Table of Contents



The increase in cash and cash equivalents in the first quarter of 2003 was
primarily due to cash flow from operations, primarily net income adjusted for
non-cash depreciation and amortization ($12.0 million). In addition to our cash
flow from operating activities of $11.5 million, we used $4.1 million on
financing activities, mostly to pay down our short-term borrowings.
Approximately $6.2 million of cash was spent on capital expenditures.

The following table summarizes our contractual cash obligations as of
March 31, 2003 (in thousands):

|                         |  |           |        |           |  |   |        | 
|------------------------ |  | --------- | ------ | --------- |  | - | ------ | 
|                         |  | Long-term |        | Operating
|                         |  | Debt      |        | Leases   
|                         |  |           |        |          
|Year Ending December 31, |  |           |        |           |  |   |        | 
|2003*                    |  | $         | 317    |           |  | $ | 5,585  | 
|2004                     |  |           | 435    |           |  |   | 6,119  | 
|2005                     |  |           | 24,369 |           |  |   | 5,343  | 
|2006                     |  |           | 360    |           |  |   | 3,439  | 
|2007                     |  |           | 375    |           |  |   | 3,319  | 
|Thereafter               |  |           | 1,196  |           |  |   | 7,894  | 
|                         |  |           |        |           |  |   |        | 
|                         |  | $         | 27,052 |           |  | $ | 31,699 | 
|                         |  |           |        |           |  |   |        | 

*Represents commitments for the remaining nine months of 2003

On
April 16, 2002, we completed a new $50.0 million credit facility with two
banks. Revolving loans under this facility mature on April 16, 2005, and bear
interest at 0.50% below one of the banks prime rate or 1.00% to 1.50% above
the eurodollar rate depending on our ratio of total funded debt to earnings
before interest and taxes plus non-cash charges. The facility provides an
option to convert any outstanding revolving loans not to exceed $40.0 million at
the maturity date to a four-year term loan. The term loan, once repaid, may not
be reborrowed. This credit agreement contains covenants, which, among other
things, require us to maintain certain financial ratios. As of March 31, 2003,
there were $24.0 million of revolving loans outstanding under this credit
agreement and the interest rate was 2.30% and 3.75% on loan balances of $22
million and $2 million, respectively. This revolving loan is included in
long-term liabilities in the accompanying balance sheet as of March 31, 2003
based on our ability and intent to defer payment beyond March 31, 2004.
Borrowings under this agreement are secured by a pledge of 100% of the
outstanding common stock of Ocular Sciences Puerto Rico and Sunsoft, Inc. and
65% of the outstanding common stock of our Barbados and Canadian subsidiaries.
As of March 31, 2003, we were in compliance with our covenants.

Item 3. Quantitative And Qualitative Disclosures About Market Risk




We have debt outstanding, which is carried at cost, with an interest rate
referenced to market rates. Interest rate changes generally do not affect the
fair value of variable rate debt instruments, but do impact future earnings and
cash flows. As of March 31, 2003, we had $24.0 million in revolving loans
outstanding under our new credit agreement. See terms of loan agreement in
Liquidity and Capital Resources section in Item 2. Holding debt levels
constant, a one-percentage point increase in interest rates would decrease
earnings and cash flows for variable rate debt by approximately $240,000 in the
year ended December 31, 2003.

We operate multiple foreign subsidiaries that manufacture and/or sell our
products worldwide. As a result, our earnings, cash flows and financial
position are exposed to foreign currency risk from foreign-currency-denominated
receivables and payables, forecasted sales transactions, and net investments in
certain foreign operations. We have not normally engaged in foreign currency
hedging activities. We continue to evaluate the potential use of such
activities on a more regular basis.

Unless otherwise noted above, there has been no additional material change
in our assessment of our sensitivity to market risk from the information set
forth in Item 7A, Quantitative and Qualitative Disclosures About Market Risk
in our Annual Report on Form 10-K for the fiscal year ended December 31, 2002.




17



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##### Table of Contents



Item 4. Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure
that information required to be disclosed in our Exchange Act reports is
recorded, processed, summarized and reported within the time periods specified
in the SECs rules and forms, and that such information is accumulated and
communicated to our management, including our Chief Executive Officer and Chief
Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure. In designing and evaluating the disclosure controls and procedures,
management recognized that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control objectives, and management necessarily was required to apply
its judgment in evaluating the cost-benefit relationship of possible controls
and procedures.

Within 90 days prior to the date of this report, we carried out an
evaluation, under the supervision and with the participation of our management,
including our Chief Executive Officer and our Chief Financial Officer, of the
effectiveness of the design and operation of our disclosure controls and
procedures. Based on the foregoing, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures were
effective.

There have been no significant changes in our internal controls or in
other factors that could significantly affect the internal controls subsequent
to the date we completed our evaluation.

Part II  OTHER INFORMATION




Item 1. Legal Proceedings




On November 6, 2002, CIBA Vision Corporation and its subsidiary, Wesley
Jessen Corporation (Wesley Jessen) filed a lawsuit against us in the U.S.
District Court for the Northern District of California alleging that our color
contact lenses infringe patents owned by Wesley Jessen. The complaint seeks an
award of damages, including unspecified punitive damages, attorneys fees and
costs and an injunction preventing the alleged infringement. We have not yet
filed an answer to the complaint. We believe the lawsuit is without merit and
we intend to defend this action vigorously.

Item 2. Changes in Securities and Use of Proceeds




None.

Item 3. Defaults Upon Senior Securities




None.

Item 4. Submission of Matters to a Vote of Security Holders




None.

Item 5. Other Information




None.

Item 6. Exhibits and Reports on Form 8-K




(a)  Exhibits

None.

(b)  Reports on Form 8-K

On May 8, 2003, we filed a Current Report on Form 8-K regarding the press
release issued on the same day, announcing our earnings for the quarter ended
March 31, 2003.




SIGNATURES

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##### Table of Contents



Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

| |  |                      
| |  | ---------------------
| |  | OCULAR SCIENCES, INC.
| |  | (Registrant)         

|                   |  |                                                                                                                                                         
|------------------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|Date: May 14, 2003 |  | /s/ Sidney B. Landman                                                                                                                                   
|                   |  |                                                                                                                                                         
|                   |  | Sidney B. Landman
Vice-President Finance, Chief Financial Officer
and Secretary (Duly Authorized Officer and Principal
Financial and Accounting Officer)

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##### Table of Contents



CERTIFICATIONS




I, Stephen J. Fanning, certify that:

1.     I have reviewed this quarterly report on Form 10-Q of Ocular Sciences,
Inc.;

2.     Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.     The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;



5.      The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of the registrants board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to record,
process, summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and

6.     The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: May14, 2003

| |                                           
| | ------------------------------------------
| | /s/ Stephen J. Fanning                    
| |                                           
| | Stephen J. Fanning
Chief Executive Officer

20



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##### Table of Contents



I, Sidney B. Landman, certify that:

1.     I have reviewed this quarterly report on Form 10-Q of Ocular Sciences,
Inc.;

2.     Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.     The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;

5.     The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of the registrants board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to record,
process, summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and

6.     The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: May 14, 2003

| |                                          
| | -----------------------------------------
| | /s/ Sidney B. Landman                    
| |                                          
| | Sidney B. Landman
Chief Financial Officer

21