Vishay Intertechnology (VSH) Tops Q1 EPS by 7c, Revenues Beat; Offers 2Q Revenue Guidance Below Consensus

Vishay Intertechnology (NYSE: VSH) reported Q1 EPS of $0.21, $0.07 better than the analyst estimate of $0.14. Revenue for the quarter came in at $613 million versus the consensus estimate of $596.19 million.

• Revenues Q1 of $613 million
• Gross margin Q1 of 24.0%; adjusted gross margin 24.5%
• Operating margin Q1 of 7.7%; adjusted operating margin 8.3%
• EPS Q1 of $0.19; adjusted EPS Q1 of $0.21
• Free Cash for the trailing 12 months of $107 million
• Guidance Q2 for revenues of $540 to $580 million and gross margins of 21.0% plus/minus 90 basis points at Q1 exchange rates
• Inventory reduction at distribution of $63 million in Q1

Commenting on results for the first quarter 2020, Dr. Gerald Paul, President and Chief Executive Officer stated, “As expected, the first quarter 2020 marked for Vishay the beginning of what might have been a recovery from a depressed second half of 2019. Despite the temporary plant shutdowns, particularly in China, due to COVID-19, sales came in within the guidance range at higher than anticipated profitability. The book-to-bill ratio was 1.17 driven by distribution while at the same time inventories of Vishay’s products at distribution were reduced by a further $63 million. The normalization in all product lines would have set Vishay up very well to participate fully in the rebound. This picture now seems very unreal when contrasted with the forecasted drop in global automotive production and a generally weak economic outlook worldwide due to the COVID-19 pandemic. Our industry like so many others is now confronted with a completely unknown challenge, a global pandemic that leads to unplannable lock-downs of entire economies and that frightens people on a very individual level. At this point, nobody can realistically forecast when and how this situation will normalize.”

Dr. Paul continued, “While we obviously cannot control the pandemic, we can react to the challenges as Vishay always has in critical times before: our plants will react quickly and professionally to changes in demand, trying to minimize inefficiencies; and we will closely monitor all fixed costs and capital expenditures without jeopardizing our long-term strategies.”

Commenting on the outlook Dr. Paul stated, “For the second quarter 2020 we guide, despite substantial uncertainties, for revenues in the range of $540 to $580 million and gross margins of 21.0% plus/minus 90 basis points at the exchange rates of the first quarter 2020.”

GUIDANCE:

Vishay Intertechnology sees Q2 2020 revenue of $540-580 million, versus the consensus of $602.4 million.

For earnings history and earnings-related data on Vishay Intertechnology (VSH) click here.

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