Vishay Reports Results for Third Quarter 2009
http://www.businesswire.com/news/home/20091027005632/en
* Revenues for Q3 2009 were $525 million or $65 million higher compared to Q2
2009
* Net earnings of $0.01 per fully diluted share, adjusted net earnings of $0.03
* Fixed costs reduced by $173 million YTD September 2009 compared to the same
period 2008
* Cash generated from operations YTD September 2009 was $179 million and capital
expenditures were $26 million
* Inventories at distribution down by 10% compared to Q2 2009
MALVERN, Pa.--(Business Wire)--
Dr. Felix Zandman, Executive Chairman of the Board, and Dr. Gerald Paul,
President and Chief Executive Officer of Vishay Intertechnology, Inc.
(NYSE:VSH), announced today that revenues for the fiscal quarter ended September
26, 2009 were $525.3 million, compared to $739.1 million for the fiscal quarter
ended September 27, 2008. Net earnings attributable to Vishay stockholders for
the fiscal quarter ended September 26, 2009 were $2.3 million, or $0.01 per
diluted share, compared to a net loss attributable to Vishay stockholders of
$301.3 million, or $1.62 per share for the fiscal quarter ended September 27,
2008.
Revenues for the nine fiscal months ended September 26, 2009 were $1,435.1
million, compared to $2,246.8 million for the nine fiscal months ended September
27, 2008. The net loss attributable to Vishay stockholders for the nine fiscal
months ended September 26, 2009 was $85.7 million, or $0.46 per share, compared
to a net loss attributable to Vishay stockholders of $1,079.9 million, or $5.79
per share for the nine fiscal months ended September 27, 2008.
Net earnings attributable to Vishay stockholders for the fiscal quarter ended
September 26, 2009 were impacted by restructuring and severance costs of $3.5
million. This item and its related tax effect had a negative $0.02 per share
effect on the net earnings attributable to Vishay stockholders.
The net loss attributable to Vishay stockholders for the fiscal quarter ended
September 27, 2008 was impacted by restructuring and severance costs of $6.8
million, impairment of goodwill and indefinite-lived intangible assets of $357.9
million, and costs associated with the terminated tender offer to acquire
International Rectifier of $4.0 million. These items and their related tax
effect had a negative $1.79 per share effect on the net earnings (loss)
attributable to Vishay stockholders.
The net loss attributable to Vishay stockholders for the nine fiscal months
ended September 26, 2009 was impacted by pretax charges for restructuring and
severance costs of $34.5 million and for an amended executive compensation
agreement of $57.8 million, partially offset by a gain of $28.2 million on
settlement of matters related to the acquisition of International Rectifier`s
Power Control Systems business. These items and their related tax effects had a
negative $0.31 per share effect on the net loss attributable to Vishay
stockholders.
The net loss attributable to Vishay stockholders for the nine fiscal months
ended September 27, 2008 was impacted by pretax charges for goodwill impairment
of $1,157.9 million, restructuring and severance costs of $34.0 million, related
asset write-downs of $4.2 million, and $9.9 million of tax expense associated
with the repatriation of cash from certain non-U.S. subsidiaries. Including the
tax effects of the pretax charges, these items had a negative $6.09 per share
effect on earnings (loss) from continuing operations. The net loss for the nine
fiscal months ended September 27, 2008 also included a loss on discontinued
operations of $42.1 million, or $0.23 per share.
As previously disclosed, the results of operations for the fiscal quarter and
nine fiscal months ended September 27, 2008 have been recast to include the
retrospective effects of FSP APB 14-1. The retrospective application of this FSP
decreased the previously reported loss from continuing operations for the
quarter by $11.5 million ($0.06 per share) and increased the previously reported
loss from continuing operations for the nine fiscal months ended September 27,
2008 by $0.8 million ($0.01 per share), respectively.
Commenting on the results for the third quarter 2009, Dr. Paul stated, "Vishay
is experiencing a recovery across all geographies, all markets and all sales
channels. The book-to-bill for Vishay was 1.11 and for each of our businesses
was above one. We again reduced our inventories, by 5% compared to the previous
quarter. Our distributors reduced their inventories of our products by 10%; the
inventory turns at distribution were 3.7 for the third quarter. In the third
quarter cash generated from operations was $110 million and capital expenditures
were $8 million. We expect capital expenditures of below $55 million for the
full year 2009."
Dr. Paul continued, "Since the economic crisis has begun, we have over the last
12 months reduced fixed costs by 20%, most of it permanently. In the same time
frame, we also have generated $255 million cash from operations while we had
capital expenditures of $79 million. This quarter we regained profitability. We
look ahead with great confidence: we are recognized as a market leader; our
total long term debt was $349 million, of which $105 million are due only in 93
years, and our cash was $508 million; we have lowered our break-even point by
$500 million. We are well positioned to participate in the upturn generating
better results than before the crisis. Due to our strong record of generating
cash we will be able to return to our strategy of synergetic acquisitions."
Commenting on the outlook for the fourth quarter 2009, Dr. Paul concluded, "We
anticipate revenues of between $530 to $570 million and improved results."
Commenting on the Company's business, Dr. Felix Zandman, Executive Chairman of
the Board and Chief Technical and Business Development Officer, stated, "In
light of challenging economic conditions we are proud of our strong cash
generation and operating improvements. These improvements will position Vishay`s
electronic components business to take advantage of the economic recovery."
Dr. Zandman continued, "In 2010 Vishay intends to spin off its Precision Group
consisting of the following product lines: strain gages (Micromeasurement), load
cells, load cell based systems and ultra precision foil resistors. The Precision
Group is planned to be spun off into a publicly traded company as a tax free
dividend to its shareholders."
As mentioned above, in a separate press release Vishay today announced its
intention to spin-off its measurements and foil resistor businesses into an
independent, publicly-traded company to be named Vishay Precision Group, Inc.
A conference call to discuss third quarter financial results and the potential
spin-off of the measurements business is scheduled for Tuesday, October 27, 2009
at 9:00 AM 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
conference ID is #31326515.
There will be a replay of the conference call from 10:00 AM ET on Tuesday,
October 27, 2009 through 11:59 PM ET on Sunday, November 1, 2009. The telephone
number for the replay is 800-642-1687 (+1 706-645-9291 if calling from outside
the United States or Canada) and the access code is #31326515.
There will also be a live audio webcast of the conference call. This can be
accessed directly from the Investor Relations section of the Vishay website at
http://ir.vishay.com.
Vishay Intertechnology, Inc., a Fortune 1,000 Company listed on the NYSE (VSH),
is one of the world's largest manufacturers of discrete semiconductors (diodes,
rectifiers, transistors, and optoelectronics and selected ICs) and passive
electronic components (resistors, capacitors, inductors, sensors, and
transducers). These components are used in virtually all types of electronic
devices and equipment, in the industrial, computing, automotive, consumer,
telecommunications, military, aerospace, and medical markets. Its product
innovations, successful acquisition strategy, and ability to provide "one-stop
shop" service have made Vishay a global industry leader. Vishay can be found on
the Internet at http://www.vishay.com.
Statements contained herein that relate to the Company's future performance,
including statements with respect to forecasted revenues, cash generation,
capital expenditures, cost reduction, business recovery, acquisition activity,
and the general state of the Company, are forward-looking statements within the
safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Such statements involve a number of risks, uncertainties and contingencies, many
of which are beyond our control, which may cause actual results, performance or
achievements to differ materially from those anticipated. Such statements are
based on current expectations only, and are subject to certain risks,
uncertainties and assumptions. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results 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, particularly the
current recessionary environment and the pace of economic recovery; difficulties
in implementing our cost reduction strategies; difficulties in identifying
suitable acquisition candidates; difficulties in new product development;
changes in foreign currency exchange rates; competition and technological
changes in our industries; and other factors affecting our operations that are
set forth in our Annual Report on Form 10-K for the year ended December 31, 2008
filed with the Securities and Exchange Commission. We undertake no obligation to
publicly update or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
Management believes that stating the impact on net earnings of items such as
restructuring and severance, asset write-downs and other items not reflecting
on-going operating activities is meaningful to investors because it provides
insight with respect to intrinsic operating results of the Company and,
management believes, is a common measure of performance in the industries in
which the Company competes. Investors should be aware, however, that this is a
non-GAAP measure of performance and should not be considered as a substitute for
the comparable GAAP measure.
VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands except earnings per share)
Fiscal quarter ended
September 26, June 27, September 27,
2009 2009 2008
as recast (a)
Net revenues $ 525,304 $ 460,258 $ 739,092
Costs of products sold 420,937 381,484 579,591
Gross profit 104,367 78,774 159,501
Gross margin 19.9 % 17.1 % 21.6 %
Selling, general, and administrative expenses 89,667 83,752 112,844
Restructuring and severance costs 3,478 12,090 6,849
Impairment of goodwill - - 357,917
Terminated tender offer expenses - - 4,000
Settlement agreement gain - (28,195 ) -
Executive employment agreement charge - 57,824 -
Operating income (loss) 11,222 (46,697 ) (322,109 )
Operating margin 2.1 % -10.1 % -43.6 %
Other income (expense):
Interest expense (2,626 ) (2,787 ) (6,942 )
Other 327 (5,510 ) 6,853
Total other income (expense) - net (2,299 ) (8,297 ) (89 )
Income (loss) from continuing operations before taxes 8,923 (54,994 ) (322,198 )
Income taxes 6,414 3,715 (21,007 )
Income (loss) from continuing operations, net of tax 2,509 (58,709 ) (301,191 )
Loss from discontinued operations, net of tax - - -
Net earnings (loss) 2,509 (58,709 ) (301,191 )
Less: net earnings attributable to noncontrolling interests 186 156 144
Net earnings (loss) attributable to Vishay stockholders $ 2,323 $ (58,865 ) $ (301,335 )
Basic earnings (loss) per share attributable to Vishay stockholders:*
Continuing operations $ 0.01 $ (0.32 ) $ (1.62 )
Discontinued operations $ - $ - $ -
Net earnings (loss) $ 0.01 $ (0.32 ) $ (1.62 )
Diluted earnings (loss) per share attributable to Vishay stockholders:*
Continuing operations $ 0.01 $ (0.32 ) $ (1.62 )
Discontinued operations $ - $ - $ -
Net earnings (loss) $ 0.01 $ (0.32 ) $ (1.62 )
Weighted average shares outstanding - basic 186,636 186,586 186,425
Weighted average shares outstanding - diluted 186,824 186,586 186,425
Amounts attributable to Vishay stockholders:
Income (loss) from continuing operations, net of tax $ 2,323 $ (58,865 ) $ (301,335 )
Discontinued operations, net of tax - - -
Net earnings (loss) $ 2,323 $ (58,865 ) $ (301,335 )
* May not add due to rounding.
(a) Recast to reflect the retrospective adoption of new accounting standards. See current report on Form 8-K filed with the U.S. Securities and Exchange Commission on April 13, 2009.
VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands except earnings per share)
Nine fiscal months ended
September 26, September 27,
2009 2008
as recast (a)
Net revenues $ 1,435,073 $ 2,246,769
Costs of products sold 1,183,908 1,735,086
Gross profit 251,165 511,683
Gross margin 17.5 % 22.8 %
Selling, general, and administrative expenses 260,873 352,928
Restructuring and severance costs 34,501 33,960
Asset write-downs - 4,195
Impairment of goodwill - 1,157,917
Terminated tender offer expenses - 4,000
Settlement agreement gain (28,195 ) -
Executive employment agreement charge 57,824 -
Operating income (loss) (73,838 ) (1,041,317 )
Operating margin -5.1 % -46.3 %
Other income (expense):
Interest expense (8,277 ) (31,939 )
Other 7,700 11,328
Total other income (expense) - net (577 ) (20,611 )
Income (loss) from continuing operations before taxes (74,415 ) (1,061,928 )
Income taxes (b) 10,839 (25,028 )
Income (loss) from continuing operations, net of tax (85,254 ) (1,036,900 )
Loss from discontinued operations, net of tax - (42,136 )
Net earnings (loss) (85,254 ) (1,079,036 )
Less: net earnings attributable to noncontrolling interests 415 891
Net earnings (loss) attributable to Vishay stockholders $ (85,669 ) $ (1,079,927 )
Basic earnings (loss) per share attributable to Vishay stockholders:*
Continuing operations $ (0.46 ) $ (5.57 )
Discontinued operations $ - $ (0.23 )
Net earnings (loss) $ (0.46 ) $ (5.79 )
Diluted earnings (loss) per share attributable to Vishay stockholders:*
Continuing operations $ (0.46 ) $ (5.57 )
Discontinued operations $ - $ (0.23 )
Net earnings (loss) $ (0.46 ) $ (5.79 )
Weighted average shares outstanding - basic 186,594 186,380
Weighted average shares outstanding - diluted 186,594 186,380
Amounts attributable to Vishay stockholders:
Income (loss) from continuing operations, net of tax $ (85,669 ) $ (1,037,791 )
Discontinued operations, net of tax - (42,136 )
Net earnings (loss) $ (85,669 ) $ (1,079,927 )
* May not add due to rounding.
(a) Recast to reflect the retrospective adoption of new accounting standards. See current report on Form 8-K filed with the U.S. Securities and Exchange Commission on April 13, 2009.
(b) Income taxes for the nine fiscal months ended September 27, 2008 includes $9.9 million of additional expense associated with repatriation of cash from non-U.S. subsidiaries.
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)
September 26, December 31,
2009 2008
Assets (unaudited) as recast (a)
Current assets:
Cash and cash equivalents $ 507,882 $ 324,164
Accounts receivable, net 304,332 311,197
Inventories:
Finished goods 120,014 173,280
Work in process 200,663 211,320
Raw materials 126,964 153,419
Total inventories 447,641 538,019
Deferred income taxes 14,056 15,251
Prepaid expenses and other current assets 102,781 139,903
Total current assets 1,376,692 1,328,534
Property and equipment, at cost:
Land 99,400 98,827
Buildings and improvements 524,712 508,579
Machinery and equipment 2,150,772 2,091,124
Construction in progress 43,239 80,857
Allowance for depreciation (1,765,824 ) (1,617,225 )
1,052,299 1,162,162
Intangible assets, net 160,845 177,782
Other assets 143,728 147,482
Total assets $ 2,733,564 $ 2,815,960
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)
September 26, December 31,
2009 2008
(unaudited) as recast (a)
Liabilities and stockholders' equity
Current liabilities:
Notes payable to banks $ 608 $ 11,293
Trade accounts payable 98,644 104,608
Payroll and related expenses 103,645 117,197
Other accrued expenses 168,665 191,086
Income taxes 13,083 24,901
Current portion of long-term debt 26,875 13,044
Total current liabilities 411,520 462,129
Long-term debt less current portion 321,933 333,631
Deferred income taxes 17,057 18,842
Deferred grant income 2,776 3,143
Other liabilities 155,314 123,207
Accrued pension and other postretirement costs 322,292 325,112
Total liabilities 1,230,892 1,266,064
Equity:
Vishay stockholders' equity
Common stock 17,228 17,220
Class B convertible common stock 1,435 1,435
Capital in excess of par value 2,317,300 2,315,851
Retained earnings (accumulated deficit) (951,286 ) (865,617 )
Accumulated other comprehensive income 112,844 75,969
Total Vishay stockholders' equity 1,497,521 1,544,858
Noncontrolling interests 5,151 5,038
Total equity 1,502,672 1,549,896
Total liabilities and equity $ 2,733,564 $ 2,815,960
(a) Recast to reflect the retrospective adoption of new accounting standards. See current report on Form 8-K filed with the U.S. Securities and Exchange Commission on April 13, 2009.
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(Unaudited - In thousands)
Nine fiscal months ended
September 26, September 27,
2009 2008
as recast (a)
Continuing operating activities
Net earnings (loss) $ (85,254 ) $ (1,079,036 )
Adjustments to reconcile net earnings (loss) to net cash provided by continuing operating activities:
Loss on discontinued operations, net of tax - 42,136
Impairment of goodwill, net of tax - 1,098,796
Depreciation and amortization 169,578 167,762
Loss (gain) on disposal of property and equipment 51 (3,217 )
Accretion of interest on convertible notes - 13,221
Asset write-downs - 4,195
Inventory write-offs for obsolescence 22,301 22,805
Deferred grant income (529 ) (1,166 )
Other (8,621 ) 3,410
Changes in operating assets and liabilities, net of effects of businesses acquired 81,114 (76,826 )
Net cash provided by continuing operating activities 178,640 192,080
Continuing investing activities
Purchase of property and equipment (26,295 ) (99,074 )
Proceeds from sale of property and equipment 2,231 10,894
Purchase of businesses, net of cash acquired or refunded 28,195 (73,924 )
Other investing activities 300 450
Net cash provided by (used in) continuing investing activities 4,431 (161,654 )
Continuing financing activities
Principal payments on long-term debt and capital lease obligations (15,058 ) (501,701 )
Proceeds of long-term debt, net of issuance costs 15,000 123,379
Net proceeds (repayment) of revolving credit lines - 125,000
Net changes in short-term borrowings (10,702 ) 1,570
Distributions to noncontrolling interests (302 ) (841 )
Proceeds from stock options exercised - 172
Net cash used in continuing financing activities (11,062 ) (252,421 )
Effect of exchange rate changes on cash and cash equivalents 14,896 5,673
Net increase in cash and cash equivalents from continuing activities 186,905 (216,322 )
Net cash used by discontinued operating activities (3,187 ) (10,382 )
Net cash provided by discontinued investing activities - 1,430
Net cash used by discontinued financing activities - -
Net cash used by discontinued operations (3,187 ) (8,952 )
Net increase in cash and cash equivalents 183,718 (225,274 )
Cash and cash equivalents at beginning of period 324,164 537,295
Cash and cash equivalents at end of period $ 507,882 $ 312,021
(a) Recast to reflect the retrospective adoption of new accounting standards. See current report on Form 8-K filed with the U.S. Securities and Exchange Commission on April 13, 2009.
Vishay Intertechnology, Inc.
Dr. Lior E. Yahalomi, Executive Vice President
and Chief Financial Officer
or
Peter G. Henrici, Senior Vice President
Corporate Communications
+1-610-644-1300
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