Vishay Reports Results for Third Quarter 2012

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Vishay Reports Results for Third Quarter 2012

  • Revenues for Q3 2012 of $573 million
  • Operating margin for Q3 2012 of 7.8%
  • EPS for Q3 2012 of $0.15
  • Cash from operations for YTD September 2012 of $186 million, capital expenditures of $87 million and proceeds on sale of property and equipment of $8 million
  • Guidance for Q4 2012 for revenues between $500 and $540 million at lower margins compared to Q3 2012

MALVERN, Pa.--(BUSINESS WIRE)-- Vishay Intertechnology, Inc. (NYS: VSH) , one of the world's largest manufacturers of discrete semiconductors and passive components, today announced its results for the fiscal quarter and nine fiscal months ended September 29, 2012.

Revenues for the fiscal quarter ended September 29, 2012 were $572.8 million, compared to $637.6 million for the fiscal quarter ended October 1, 2011. The net earnings attributable to Vishay stockholders for the fiscal quarter ended September 29, 2012 were $22.3 million, or $0.15 per diluted share, compared to $50.5 million, or $0.31 per diluted share for the fiscal quarter ended October 1, 2011.


Revenues for the nine fiscal months ended September 29, 2012 were $1,699.5 million, compared to $2,042.6 million for the nine fiscal months ended October 1, 2011. The net earnings attributable to Vishay stockholders for the nine fiscal months ended September 29, 2012 were $101.8 million, or $0.65 per diluted share, compared to $207.9 million, or $1.22 per diluted share for the nine fiscal months ended October 1, 2011.

Net earnings attributable to Vishay stockholders for the nine fiscal months ended September 29, 2012 and prior year periods include various items affecting comparability, as listed on the attached reconciliation schedule. Adjusted net earnings per diluted share, which exclude these items, were $0.15 and $0.60 for the fiscal quarter and nine fiscal months ended September 29, 2012, respectively, and $0.32 and $1.30 for the fiscal quarter and nine fiscal months ended October 1, 2011, respectively.

Commenting on the results for the third quarter of 2012, Dr. Gerald Paul, President and Chief Executive Officer, stated, "Over the course of the third quarter many of our end markets deteriorated substantially, in particular computing and consumer, which resulted in unexpectedly low orders from Asian distribution. Nonetheless the operating margin was in line with our business model. Selling, general, and administrative expenses as well as manufacturing fixed costs were kept well under control, while the quarter was burdened by temporary inefficiencies related to the volume drop and an inventory reduction."

Dr. Paul continued, "Our current anticipation for the profitability for the full year is substantially lower than previously anticipated, which resulted in a significant shift in the estimated mix of income among our various taxing jurisdictions. As a consequence, our normalized tax rate for the year increased to 33% resulting in a very high effective tax rate for the third quarter impacting EPS."

Commenting on Vishay's Growth Plan, Dr. Paul stated, "Despite fast changes in the economic environment, Vishay is in a position to continue to steadily pursue its Growth Plan. Since the end of 2009 we increased our technical staff in research and development as well as in product engineering by 15%, while managing to reduce our total fixed costs. We intend to continue on this path. We are also proactively expanding critical manufacturing capacities and increasing our technical sales force in Asia to better penetrate the local industrial markets. As part of our Growth Plan we continue to actively pursue small to mid-size acquisitions of niche businesses."

Commenting on the outlook for the fourth quarter of 2012, Dr. Paul remarked, "Based on our low book to bill, we are currently anticipating revenues to fall between $500 and $540 million at accordingly lower margins compared to the third quarter of 2012."

The Company expects to file its Quarterly Report on Form 10-Q for the third fiscal quarter of 2012 with the Securities and Exchange Commission after the close of the market on Tuesday, October 30, 2012. This financial report will be available at ir.vishay.com.

A conference call to discuss third quarter financial results is scheduled for Tuesday, October 30, 2012 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 32943484. There will be a replay of the conference call from 10:30 AM ET on Tuesday, October 30, 2012 through 11:59 PM ET on Monday, November 5, 2012. The telephone number for the replay is 800-585-8367 (+1 855-859-2056 or 404-537-3406 if calling from outside the United States or Canada) and the access code is 32943484.

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.

About Vishay

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, 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 generally accepted accounting principles ("GAAP"), including adjusted net earnings (loss) and adjusted net earnings (loss) per share, 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 and should not be viewed as an alternative to GAAP measures of performance. Non-GAAP measures such as adjusted net earnings and adjusted earnings per diluted share 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 these measures are meaningful to investors because they provide insight with respect to intrinsic operating results of the Company. Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to an understanding to the Company's intrinsic operations. These reconciling items are indicated on the accompanying reconciliation schedule 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, cash generation, internal growth and acquisition activity, and the general state of the Company, 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; difficulties in implementing our cost reduction strategies; 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; uncertainty related to the effects of changes in foreign currency exchange rates; 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.

 
VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands, except per share amounts)
   
Fiscal quarters ended
September 29,June 30,October 1,
 2012  2012  2011 
 
Net revenues$572,781$588,199$637,649
Costs of products sold 439,227  440,580  470,172 
Gross profit133,554147,619167,477
Gross margin23.3%25.1%26.3%
 
Selling, general, and administrative expenses89,09586,88990,271
Gain on sale of property-(12,153)-
Executive compensation charge -  -  1,873 
Operating income44,45972,88375,333
Operating margin7.8%12.4%11.8%
 
Other income (expense):
Interest expense(6,009)(5,539)(5,311)
Other 2,726  (2,094) 1,790 
Total other income (expense) - net (3,283) (7,633) (3,521)
 
Income before taxes41,17665,25071,812
 
Income taxes 18,687  19,420  21,120 
 
Net earnings22,48945,83050,692
 
Less: net earnings attributable to noncontrolling interests209159205
   
Net earnings attributable to Vishay stockholders$22,280 $45,671 $50,487 
 
Basic earnings per share attributable to Vishay stockholders$0.16$0.30$0.32
 
Diluted earnings per share attributable to Vishay stockholders$0.15$0.29$0.31
 
Weighted average shares outstanding - basic143,273152,462157,149
 
Weighted average shares outstanding - diluted150,118159,249163,808
 
 
VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands, except per share amounts)
  
Nine fiscal months ended
September 29,October 1,
20122011
 
Net revenues$1,699,527$2,042,638
Costs of products sold 1,281,645  1,448,308 
Gross profit417,882594,330
Gross margin24.6%29.1%
 
Selling, general, and administrative expenses262,348275,532
Gain on sale of property(12,153)-
Executive compensation charges -  5,762 
Operating income167,687313,036
Operating margin9.9%15.3%
 
Other income (expense):
Interest expense(16,265)(13,989)
Other 1,940  1,255 
Total other income (expense) - net (14,325) (12,734)
 
Income before taxes153,362300,302
 
Income taxes 50,968  91,507 
 
Net earnings102,394208,795
 
Less: net earnings attributable to noncontrolling interests631926
  
Net earnings attributable to Vishay stockholders$101,763 $207,869 
 
Basic earnings per share attributable to Vishay stockholders$0.67$1.29
 
Diluted earnings per share attributable to Vishay stockholders$0.65$1.22
 
Weighted average shares outstanding - basic150,978161,061
 
Weighted average shares outstanding - diluted157,770170,039
 
 
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)
  
September 29,December 31,
 2012  2011 
Assets(unaudited)
Current assets:
Cash and cash equivalents$637,262$749,088
Short-term investments303,872249,139
Accounts receivable, net278,092270,970
Inventories:
Finished goods110,293104,478
Work in process186,922181,354
Raw materials 131,223  131,795 
Total inventories428,438417,627
 
Deferred income taxes25,00524,632
Prepaid expenses and other current assets 121,851  119,220 
Total current assets1,794,5201,830,676
 
Property and equipment, at cost:
Land91,89591,507
Buildings and improvements514,036493,550
Machinery and equipment2,125,3222,079,395
Construction in progress86,77194,717
Allowance for depreciation (1,931,633) (1,851,264)
886,391907,905
 
Goodwill34,8669,051
 
Other intangible assets, net136,726103,927
 
Other assets 135,671  142,171 
Total assets$2,988,174 $2,993,730 
 
  
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)
 
September 29,December 31,
 2012  2011 
(unaudited)
Liabilities and stockholders' equity
Current liabilities:
Notes payable to banks$5$13
Trade accounts payable135,397154,942
Payroll and related expenses103,240109,833
Other accrued expenses158,883161,119
Income taxes 31,007  13,881 
Total current liabilities428,532439,788
 
Long-term debt less current portion389,040399,054
Deferred income taxes128,728110,356
Other liabilities111,097117,235
Accrued pension and other postretirement costs 298,502  319,136 
Total liabilities 1,355,899  1,385,569 
 
Equity:
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