Bausch & Lomb feels well on its way to reinventing itself as a market force in disposable contact lenses and refractive surgery products. After disposing of its older, non-core businesses such as its Ray-Ban sunglasses and its hearing aid operations, it has decided to ramp up R&D and marketing for its contact lens and ophthalmic surgery products, in light of an increasingly cut-throat market for disposable lenses and a growing world demand for laser vision surgery.

To consolidate contact-lens manufacturing and cut costs, Bausch & Lomb announced last December a plan to eliminate 850 jobs or 7 percent of its workforce, mostly in its home base of Rochester, N.Y., and replaced older equipment with updated machinery. Production of PureVision lenses is being consolidated in Rochester.

The new program, which also involves accelerated savings in global administrative expenses, is expected to add about $10 million to group operating earnings this year, and double as much afterwards. In connection with these measures, the company provisioned a $34 million restructuring charge in the 4th quarter ended Dec. 25, or $56.7 million before taxes.

In spite of these extraordinary charges, the group's earnings from continuing operations - vision care, pharmaceuticals and surgical segments - turned around to $17.2 million in the 4th quarter, as compared to a loss of $43.1 million in the year-ago period. Excluding extraordinary items, continuing operations had net income of $51.4 million, up from $37.5 million.

For the full year, net earnings from continuing operations were $444.8 million, as compared to $25.2 million, excluding extraordinary items. Including these items, 1999 net earnings were $132.6 million, up from $104.6 million in 1998.

Full-year revenues from continuing businesses were $1,756.1 million, an increase of 10 percent from 1998. Vision-care revenues rose by 6 percent overall, and contact lens revenues by 11 percent, in line with expectations. Bausch & Lomb enjoyed double-digit sales growth for replacements and disposables, including new SofLens one-day lenses and PureVision extended-wear lenses.

Surgical segment revenues climbed by 14 percent, driven by double-digit growth in sales of refractive surgery products. Pharmaceutical revenues rose by 12 percent on strong sales of ophthalmic pharmaceuticals and non-ophthalmic multi-source products.