Upgrade to SI Premium - Free Trial

Vishay Reports Results For Fourth Quarter and Year 2019

February 4, 2020 7:00 AM

MALVERN, Pa. , Feb. 04, 2020 (GLOBE NEWSWIRE) -- Vishay Intertechnology, Inc. (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive components, today announced its results for the year and fiscal quarter ended December 31, 2019.

Revenues for the year ended December 31, 2019 were $2,668.3 million, compared to $3,034.7 million for the year ended December 31, 2018. Net earnings attributable to Vishay stockholders for the year ended December 31, 2019 were $163.9 million, or $1.13 per diluted share compared to $345.8 million, or $2.24 per diluted share for the year ended December 31, 2018.

Revenues for the fiscal quarter ended December 31, 2019 were $609.6 million, compared to $628.3 million for the fiscal quarter ended September 28, 2019, and $775.9 million for the fiscal quarter ended December 31, 2018. Net earnings attributable to Vishay stockholders for the fiscal quarter ended December 31, 2019 were $14.0 million, or $0.10 per diluted share, compared to $30.0 million, or $0.21 per diluted share for the fiscal quarter ended September 28, 2019, and $102.4 million, or $0.69 per diluted share for the fiscal quarter ended December 31, 2018.

As summarized on the attached reconciliation schedule, all periods presented include items affecting comparability. Adjusted earnings per diluted share, which exclude these items net of tax and the unusual tax items, were $0.13 and $1.26 for the fiscal quarter and year ended December 31, 2019, respectively, $0.26 for the fiscal quarter ended September 28, 2019, and $0.58 and $2.12 for the fiscal quarter and year ended December 31, 2018, respectively.

Commenting on results for the year 2019, Dr. Gerald Paul, President and Chief Executive Officer stated, “After a prolonged upturn in the prior two years, 2019 has been a year of correction for Vishay and the electronic components industry. The reduction of inflated inventory levels in the supply chain led to drastically reduced manufacturing volumes, which negatively impacted Vishay’s profitability. A further burden has been temporary manufacturing inefficiencies due to the very rapid and substantial adaptation of capacities to the decreased demand.”

Dr. Paul continued, commenting on the results for the fourth quarter 2019, “The performance in the fourth quarter has been disappointing due to a lower than usual contributive margin caused by an unfavorable product mix and various negative singularities impacting variable cost; lower other income; and a higher than assumed tax rate for the year. During the fourth quarter inventories of Vishay’s products at distribution were reduced by a further $37 million. Based on lower order cancellations and an order uptick from distribution in all regions, we believe that the fourth quarter represented the low point of the inventory correction in the supply chain.”

Commenting on the outlook Dr. Paul stated, “For the first quarter 2020 we expect a further inventory reduction in the supply chain and guide for revenues in the range of $605 to $645 million and gross margins of 24.0% plus/minus 70 basis points at the exchange rates of the fourth quarter 2019. The guidance excludes the impact from the rapidly evolving coronavirus crisis.”

A conference call to discuss Vishay’s third quarter financial results is scheduled for Tuesday, February 4, 2020 at 9:00 a.m. ET. The dial-in number for the conference call is 877-589-6174 (+1 706-643-1406, if calling from outside the United States or Canada) and the access code is 4395745.

A live audio webcast of the conference call and a PDF copy of the press release and the quarterly presentation will be accessible directly from the Investor Relations section of the Vishay website at http://ir.vishay.com.

There will be a replay of the conference call from 12:00 p.m. ET on Tuesday, February 4, 2020, through 11:59 p.m. ET on Tuesday, February 18, 2020. The telephone number for the replay is +1 855-859-2056 (+1 404-537-3406, if calling from outside the United States or Canada) and the access code is 4395745.

About VishayVishay Intertechnology, Inc., a Fortune 1000 Company listed on the NYSE (VSH), is one of the world's largest manufacturers of discrete semiconductors (diodes, MOSFETs, and infrared optoelectronics) and passive electronic components (resistors, inductors, and capacitors). These components are used in virtually all types of electronic devices and equipment, in the industrial, computing, automotive, consumer, telecommunications, military, aerospace, power supplies, and medical markets. Vishay’s product innovations, successful acquisition strategy, and "one-stop shop" service have made it a global industry leader. Vishay can be found on the Internet at http://www.vishay.com.

This press release includes certain financial measures which are not recognized in accordance with U.S. generally accepted accounting principles ("GAAP"), including adjusted net earnings; adjusted earnings per share; adjusted operating margin; free cash; earnings before interest, taxes, depreciation and amortization ("EBITDA"); adjusted EBITDA; and adjusted EBITDA margin; which are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. These non-GAAP measures supplement our GAAP measures of performance or liquidity and should not be viewed as an alternative to GAAP measures of performance or liquidity. Non-GAAP measures such as adjusted net earnings, adjusted earnings per share, adjusted operating margin, free cash, EBITDA, adjusted EBITDA, and adjusted EBITDA margin do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Management believes that such measures are meaningful to investors because they provide insight with respect to intrinsic operating results of the Company. Although the terms "free cash" and "EBITDA" are not defined in GAAP, the measures are derived using various line items measured in accordance with GAAP. Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to understanding the Company's intrinsic operations. Reconciling items to calculate adjusted operating margin and adjusted EBITDA represent those same items used in computing adjusted net earnings, as relevant. Furthermore, the presented calculation of adjusted EBITDA is substantially similar to, but not identical to, a measure used in the calculation of financial ratios required for covenant compliance under Vishay's revolving credit facility. These reconciling items are indicated on the accompanying reconciliation schedules and are more fully described in the Company's financial statements presented in its annual report on Form 10-K and its quarterly reports presented on Forms 10-Q.

Statements contained herein that relate to the Company's future performance, including statements with respect to forecasted revenues, margins, inventories, product demand, and the performance of the economy in general, are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "project," "intend," "could," "should," or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; manufacturing or supply chain interruptions or changes in customer demand because of the coronavirus or similar diseases; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact: Vishay Intertechnology, Inc. Peter Henrici Senior Vice President, Corporate Communications +1-610-644-1300

VSH - Earnings

VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(In thousands, except per share amounts)
Years ended
December 31, 2019 December 31, 2018
(Unaudited)
Net revenues$2,668,305 $3,034,689
Costs of products sold 1,997,105 2,146,165
Gross profit 671,200 888,524
Gross margin 25.2% 29.3%
Selling, general, and administrative expenses 384,631 403,404
Restructuring and severance costs 24,139 -
Operating income 262,430 485,120
Operating margin 9.8% 16.0%
Other income (expense):
Interest expense (33,683) (36,680)
Other components of net periodic pension cost (13,959) (13,118)
Other 13,540 8,037
Loss on early extinguishment of debt (2,030) (26,583)
Total other income (expense) - net (36,132) (68,344)
Income before taxes 226,298 416,776
Income tax expense 61,508 70,239
Net earnings 164,790 346,537
Less: net earnings attributable to noncontrolling interests 854 779
Net earnings attributable to Vishay stockholders$163,936 $345,758
Basic earnings per share attributable to Vishay stockholders$1.13 $2.39
Diluted earnings per share attributable to Vishay stockholders$1.13 $2.24
Weighted average shares outstanding - basic 144,608 144,370
Weighted average shares outstanding - diluted 145,136 154,622
Cash dividends per share$0.3700 $0.3225

VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands, except per share amounts)
Fiscal quarters ended
December 31, 2019 September 28, 2019 December 31, 2018
Net revenues$609,577 $628,329 $775,892
Costs of products sold 474,216 478,250 556,202
Gross profit 135,361 150,079 219,690
Gross margin 22.2% 23.9% 28.3%
Selling, general, and administrative expenses 94,299 91,796 100,023
Restructuring and severance costs 16,884 7,255 -
Operating income 24,178 51,028 119,667
Operating margin 4.0% 8.1% 15.4%
Other income (expense):
Interest expense (8,523) (8,564) (9,818)
Other components of net periodic pension cost (3,848) (3,348) (2,782)
Other 196 5,066 2,597
Loss on early extinguishment of debt (723) - (9,274)
Total other income (expense) - net (12,898) (6,846) (19,277)
Income before taxes 11,280 44,182 100,390
Income tax expense (benefit) (2,869) 13,917 (2,269)
Net earnings 14,149 30,265 102,659
Less: net earnings attributable to noncontrolling interests 187 227 240
Net earnings attributable to Vishay stockholders$13,962 $30,038 $102,419
Basic earnings per share attributable to Vishay stockholders$0.10 $0.21 $0.71
Diluted earnings per share attributable to Vishay stockholders$0.10 $0.21 $0.69
Weighted average shares outstanding - basic 144,628 144,628 144,384
Weighted average shares outstanding - diluted 145,202 145,027 148,378
Cash dividends per share$0.095 $0.095 $0.0850

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)
December 31, 2019 December 31, 2018
(Unaudited)
Assets
Current assets:
Cash and cash equivalents$694,133 $686,032
Short-term investments 108,822 78,286
Accounts receivable, net 328,187 397,020
Inventories:
Finished goods 122,466 138,112
Work in process 187,354 190,982
Raw materials 121,860 150,566
Total inventories 431,680 479,660
Prepaid expenses and other current assets 141,294 142,888
Total current assets 1,704,116 1,783,886
Property and equipment, at cost:
Land 75,011 87,622
Buildings and improvements 585,064 619,445
Machinery and equipment 2,606,355 2,510,001
Construction in progress 110,722 125,109
Allowance for depreciation (2,425,627) (2,373,176)
951,525 969,001
Right of use assets 93,162 -
Goodwill 150,642 147,480
Other intangible assets, net 60,659 65,688
Other assets 160,671 140,143
Total assets$3,120,775 $3,106,198

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)
December 31, 2019 December 31, 2018
(Unaudited)
Liabilities and stockholders' equity
Current liabilities:
Notes payable to banks$2 $18
Trade accounts payable 173,915 218,322
Payroll and related expenses 122,100 141,670
Lease liabilities 20,217 -
Other accrued expenses 186,463 229,660
Income taxes 17,731 54,436
Total current liabilities 520,428 644,106
Long-term debt less current portion 499,147 494,509
U.S. transition tax payable 140,196 154,953
Deferred income taxes 22,021 85,471
Long-term lease liabilities 78,511 -
Other liabilities 100,207 79,489
Accrued pension and other postretirement costs 272,402 260,984
Total liabilities 1,632,912 1,719,512
Redeemable convertible debentures 174 2,016
Equity:
Vishay stockholders' equity
Common stock 13,235 13,212
Class B convertible common stock 1,210 1,210
Capital in excess of par value 1,425,170 1,436,011
Retained earnings (accumulated deficit) 72,180 (61,258)
Accumulated other comprehensive income (loss) (26,646) (6,791)
Total Vishay stockholders' equity 1,485,149 1,382,384
Noncontrolling interests 2,540 2,286
Total equity 1,487,689 1,384,670
Total liabilities, temporary equity, and equity$3,120,775 $3,106,198

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(In thousands)
Years ended
December 31, 2019 December 31, 2018
(Unaudited)
Operating activities
Net earnings$164,790 $346,537
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization 164,461 161,863
(Gain) loss on disposal of property and equipment (157) (2,216)
Accretion of interest on convertible debt instruments 14,146 10,769
Inventory write-offs for obsolescence 26,494 23,872
Pensions and other postretirement benefits, net of contributions (552) (1,549)
Loss on early extinguishment of debt 2,030 26,583
Deferred income taxes (23,009) (55,206)
Other 13,341 21,194
Change in U.S. transition tax liability (14,757) (14,757)
Change in repatriation tax liability (38,814) (156,767)
Changes in operating assets and liabilities, net of effects of businesses acquired (11,529) (101,817)
Net cash provided by operating activities 296,444 258,506
Investing activities
Purchase of property and equipment (156,641) (229,899)
Proceeds from sale of property and equipment 577 55,561
Purchase of businesses, net of cash acquired (11,862) (14,880)
Purchase of short-term investments (111,631) (175,403)
Maturity of short-term investments 81,012 636,108
Other investing activities 3,587 (2,058)
Net cash provided by (used in) investing activities (194,958) 269,429
Financing activities
Proceeds from long-term borrowings - 600,000
Issuance costs (5,394) (15,621)
Repurchase of convertible debentures (27,863) (960,995)
Net proceeds (payments) on revolving credit lines - (150,000)
Net changes in short-term borrowings (16) 15
Dividends paid to common stockholders (48,968) (42,608)
Dividends paid to Class B common stockholders (4,476) (3,901)
Distributions to noncontrolling interests (600) (525)
Cash withholding taxes paid when shares withheld for vested equity awards (2,708) (2,297)
Net cash used in financing activities (90,025) (575,932)
Effect of exchange rate changes on cash and cash equivalents (3,360) (14,003)
Net increase (decrease) in cash and cash equivalents 8,101 (62,000)
Cash and cash equivalents at beginning of period 686,032 748,032
Cash and cash equivalents at end of period$694,133 $686,032

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Adjusted Earnings Per Share
(Unaudited - In thousands, except per share amounts)
Fiscal quarters ended Years ended
December 31, 2019 September 28, 2019 December 31, 2018 December 31, 2019 December 31, 2018
GAAP net earnings attributable to Vishay stockholders$13,962 $30,038 $102,419 $163,936 $345,758
Reconciling items affecting operating income:
Restructuring and severance costs$16,884 $7,255 $- $24,139 $-
Reconciling items affecting other income (expense):
Loss on early extinguishment of debt$723 $- $9,274 $2,030 $26,583
Reconciling items affecting tax expense (benefit):
Effects of tax-basis foreign exchange gain$- $- $- $7,554 $-
Enactment of TCJA - - - - 25,496
Effects of cash repatriation program (11,554) 2,604 (3,037) (9,583) (10,047)
Change in deferred taxes due to early extinguishment of debt (289) - (20,914) (1,601) (54,877)
Effects of changes in uncertain tax positions 2,831 - - 2,831 -
Tax effects of pre-tax items above (4,277) (1,644) (2,028) (6,211) (5,812)
Adjusted net earnings$18,280 $38,253 $85,714 $183,095 $327,101
Adjusted weighted average diluted shares outstanding 145,202 145,027 148,378 145,136 154,622
Adjusted earnings per diluted share$0.13 $0.26 $0.58 $1.26 $2.12

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Free Cash
(Unaudited - In thousands)
Fiscal quarters ended Years ended
December 31, 2019 September 28, 2019 December 31, 2018 December 31, 2019 December 31, 2018
Net cash provided by operating activities$84,423 $76,202 $149,615 $296,444 $258,506
Proceeds from sale of property and equipment 91 22 47,106 577 55,561
Less: Capital expenditures (56,374) (30,119) (103,508) (156,641) (229,899)
Free cash$28,140 $46,105 $93,213 $140,380 $84,168

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of EBITDA and Adjusted EBITDA
(Unaudited - In thousands)
Fiscal quarters ended Years ended
December 31, 2019 September 28, 2019 December 31, 2018 December 31, 2019 December 31, 2018
GAAP net earnings attributable to Vishay stockholders$13,962 $30,038 $102,419 $163,936 $345,758
Net earnings attributable to noncontrolling interests 187 227 240 854 779
Net earnings$14,149 $30,265 $102,659 $164,790 $346,537
Interest expense$8,523 $8,564 $9,818 $33,683 $36,680
Interest income (1,734) (2,365) (3,638) (8,445) (11,940)
Income taxes (2,869) 13,917 (2,269) 61,508 70,239
Depreciation and amortization 42,159 40,956 39,975 164,461 161,863
EBITDA$60,228 $91,337 $146,545 $415,997 $603,379
Reconciling items
Restructuring and severance costs$16,884 $7,255 $- $24,139 $-
Loss on early extinguishment of debt 723 - 9,274 2,030 26,583
Adjusted EBITDA$77,835 $98,592 $155,819 $442,166 $629,962
Adjusted EBITDA margin** 12.8% 15.7% 20.1% 16.6% 20.8%
** Adjusted EBITDA as a percentage of net revenues

Vishay_Logo_1280x1024.jpg

Source: Vishay Intertechnology, Inc.

Categories

Globe Newswire Press Releases

Next Articles