- Revenues for Q3 2018 of $781 million
- Gross Margin Q3 of 30.3%
- Operating Margin Q3 of 17.7%
- EPS Q3 of $0.51
- Adjusted EPS Q3 of $0.60
- Guidance for Q4 2018 for revenues of $745 to $785 million and gross margins of 28.0% to 29.5% at Q3 exchange rates
- Repatriated in Q3 $450 million net of related foreign taxes
MALVERN, Pa., Oct. 30, 2018 (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 fiscal quarter and nine fiscal months ended September 29, 2018.
Revenues for the fiscal quarter ended September 29, 2018 were $781.0 million, compared to $761.0 million for the fiscal quarter ended June 30, 2018, and $677.9 million for the fiscal quarter ended September 30, 2017. Net earnings attributable to Vishay stockholders for the fiscal quarter ended September 29, 2018 were $77.9 million, or $0.51 per diluted share, compared to $103.1 million, or $0.65 per diluted share for the fiscal quarter ended June 30, 2018, and $64.4 million, or $0.41 per diluted share for the fiscal quarter ended September 30, 2017.
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 $0.60, $0.54, and $0.42 for the fiscal quarters ended September 29, 2018, June 30, 2018, and September 30, 2017, respectively.
Commenting on the results for the third quarter 2018, Dr. Gerald Paul, President and Chief Executive Officer, stated, “As in the previous quarters, Vishay continued in the third quarter to enjoy excellent business conditions in virtually all markets. Inventories in the supply chain showed some increases but there are no tangible signs of a slowdown in our industry.”
“We presently see first signs of a normalization of inflated backlogs as supply starts to catch up with demand. The overall demand of OEMs continues strong and point of sales of our products from distribution to end customers was again 14% higher than in the third quarter of last year.”
Commenting on the outlook Dr. Paul stated, “We guide for the fourth quarter for revenues of $745 to $785 million and gross margins of 28.0% to 29.5% at the exchange rates for the third quarter.”
A conference call to discuss Vishay’s third quarter financial results is scheduled for Tuesday, October 30, 2018 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 conference ID is 5894659.
There will be a replay of the conference call from 12:00 p.m. ET on Tuesday, October 30, 2018 through 11:59 p.m. ET on Tuesday, November 6, 2018. 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 5894659.
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.
About Vishay
Vishay 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 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, product demand, global growth markets generally 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; 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
| VISHAY INTERTECHNOLOGY, INC. | |||||||||||
| Summary of Operations | |||||||||||
| (Unaudited - In thousands, except per share amounts) | |||||||||||
| Fiscal quarters ended | |||||||||||
| September 29, 2018 | June 30, 2018 | September 30, 2017* | |||||||||
| Net revenues | $ | 780,972 | $ | 761,030 | $ | 677,941 | |||||
| Costs of products sold | 544,676 | 533,792 | 487,794 | ||||||||
| Gross profit | 236,296 | 227,238 | 190,147 | ||||||||
| Gross margin | 30.3 | % | 29.9 | % | 28.0 | % | |||||
| Selling, general, and administrative expenses | 98,198 | 103,945 | 91,487 | ||||||||
| Restructuring and severance costs | - | - | 3,244 | ||||||||
| Operating income | 138,098 | 123,293 | 95,416 | ||||||||
| Operating margin | 17.7 | % | 16.2 | % | 14.1 | % | |||||
| Other income (expense): | |||||||||||
| Interest expense | (10,813 | ) | (8,372 | ) | (6,938 | ) | |||||
| Other components of net periodic pension cost | (3,367 | ) | (3,450 | ) | (3,088 | ) | |||||
| Other | 2,890 | 3,397 | 798 | ||||||||
| Loss on early extinguishment of debt | - | (17,309 | ) | - | |||||||
| Total other income (expense) - net | (11,290 | ) | (25,734 | ) | (9,228 | ) | |||||
| Income before taxes | 126,808 | 97,559 | 86,188 | ||||||||
| Income taxes | 48,737 | (5,703 | ) | 21,605 | |||||||
| Net earnings | 78,071 | 103,262 | 64,583 | ||||||||
| Less: net earnings attributable to noncontrolling interests | 195 | 165 | 179 | ||||||||
| Net earnings attributable to Vishay stockholders | $ | 77,876 | $ | 103,097 | $ | 64,404 | |||||
| Basic earnings per share attributable to Vishay stockholders | $ | 0.54 | $ | 0.71 | $ | 0.44 | |||||
| Diluted earnings per share attributable to Vishay stockholders | $ | 0.51 | $ | 0.65 | $ | 0.41 | |||||
| Weighted average shares outstanding - basic | 144,383 | 144,382 | 145,728 | ||||||||
| Weighted average shares outstanding - diluted | 152,946 | 157,657 | 156,701 | ||||||||
| Cash dividends per share | $ | 0.0850 | $ | 0.0850 | $ | 0.0625 | |||||
| *Recast for the retrospective adoption of ASUs 2014-09 and 2017-07 | |||||||||||
| VISHAY INTERTECHNOLOGY, INC. | |||||||
| Summary of Operations | |||||||
| (Unaudited - In thousands, except per share amounts) | |||||||
| Nine fiscal months ended | |||||||
| September 29, 2018 | September 30, 2017* | ||||||
| Net revenues | $ | 2,258,797 | $ | 1,925,906 | |||
| Costs of products sold | 1,589,963 | 1,400,173 | |||||
| Gross profit | 668,834 | 525,733 | |||||
| Gross margin | 29.6 | % | 27.3 | % | |||
| Selling, general, and administrative expenses | 303,381 | 272,540 | |||||
| Restructuring and severance costs | - | 5,194 | |||||
| Operating income | 365,453 | 247,999 | |||||
| Operating margin | 16.2 | % | 12.9 | % | |||
| Other income (expense): | |||||||
| Interest expense | (26,862 | ) | (20,804 | ) | |||
| Other components of net periodic pension cost | (10,336 | ) | (8,947 | ) | |||
| Other | 5,440 | 1,151 | |||||
| Loss on early extinguishment of debt | (17,309 | ) | - | ||||
| Loss on disposal of equity affiliate | - | (7,060 | ) | ||||
| Total other income (expense) - net | (49,067 | ) | (35,660 | ) | |||
| Income before taxes | 316,386 | 212,339 | |||||
| Income taxes | 72,508 | 54,398 | |||||
| Net earnings | 243,878 | 157,941 | |||||
| Less: net earnings attributable to noncontrolling interests | 539 | 628 | |||||
| Net earnings attributable to Vishay stockholders | $ | 243,339 | $ | 157,313 | |||
| Basic earnings per share attributable to Vishay stockholders | $ | 1.69 | $ | 1.08 | |||
| Diluted earnings per share attributable to Vishay stockholders | $ | 1.55 | $ | 1.01 | |||
| Weighted average shares outstanding - basic | 144,364 | 146,128 | |||||
| Weighted average shares outstanding - diluted | 156,702 | 155,626 | |||||
| Cash dividends per share | $ | 0.2375 | $ | 0.1875 | |||
| *Recast for the retrospective adoption of ASUs 2014-09 and 2017-07 | |||||||
| VISHAY INTERTECHNOLOGY, INC. | |||||||
| Consolidated Condensed Balance Sheets | |||||||
| (Unaudited - in thousands) | |||||||
| September 29, 2018 | December 31, 2017* | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 928,105 | $ | 748,032 | |||
| Short-term investments | 135,003 | 547,136 | |||||
| Accounts receivable, net | 395,442 | 340,027 | |||||
| Inventories: | |||||||
| Finished goods | 144,622 | 127,272 | |||||
| Work in process | 197,174 | 170,319 | |||||
| Raw materials | 158,505 | 132,068 | |||||
| Total inventories | 500,301 | 429,659 | |||||
| Prepaid expenses and other current assets | 124,949 | 130,336 | |||||
| Total current assets | 2,083,800 | 2,195,190 | |||||
| Property and equipment, at cost: | |||||||
| Land | 87,062 | 92,285 | |||||
| Buildings and improvements | 616,713 | 606,168 | |||||
| Machinery and equipment | 2,478,521 | 2,415,769 | |||||
| Construction in progress | 90,776 | 103,058 | |||||
| Allowance for depreciation | (2,364,205 | ) | (2,311,522 | ) | |||
| 908,867 | 905,758 | ||||||
| Goodwill | 147,752 | 142,742 | |||||
| Other intangible assets, net | 67,234 | 69,754 | |||||
| Other assets | 141,981 | 148,645 | |||||
| Total assets | $ | 3,349,634 | $ | 3,462,089 | |||
| *Recast for the retrospective adoption of ASUs 2014-09 and 2017-07 | |||||||
| VISHAY INTERTECHNOLOGY, INC. | |||||||
| Consolidated Condensed Balance Sheets (continued) | |||||||
| (Unaudited - in thousands) | |||||||
| September 29, 2018 | December 31, 2017* | ||||||
| Liabilities and stockholders' equity | |||||||
| Current liabilities: | |||||||
| Notes payable to banks | $ | 4 | $ | 4 | |||
| Trade accounts payable | 198,674 | 222,373 | |||||
| Payroll and related expenses | 143,257 | 135,702 | |||||
| Other accrued expenses | 174,689 | 154,230 | |||||
| Income taxes | 45,664 | 50,226 | |||||
| Total current liabilities | 562,288 | 562,535 | |||||
| Long-term debt less current portion | 588,586 | 370,470 | |||||
| U.S. transition tax payable | 154,953 | 151,200 | |||||
| Deferred income taxes | 151,499 | 336,465 | |||||
| Other liabilities | 84,827 | 75,249 | |||||
| Accrued pension and other postretirement costs | 269,610 | 281,701 | |||||
| Total liabilities | 1,811,763 | 1,777,620 | |||||
| Redeemable convertible debentures | 79,186 | 252,070 | |||||
| Equity: | |||||||
| Vishay stockholders' equity | |||||||
| Common stock | 13,212 | 13,188 | |||||
| Class B convertible common stock | 1,210 | 1,213 | |||||
| Capital in excess of par value | 1,595,092 | 1,752,506 | |||||
| Retained earnings (accumulated deficit) | (151,404 | ) | (362,254 | ) | |||
| Accumulated other comprehensive income (loss) | (1,471 | ) | 25,714 | ||||
| Total Vishay stockholders' equity | 1,456,639 | 1,430,367 | |||||
| Noncontrolling interests | 2,046 | 2,032 | |||||
| Total equity | 1,458,685 | 1,432,399 | |||||
| Total liabilities, temporary equity, and equity | $ | 3,349,634 | $ | 3,462,089 | |||
| *Recast for the retrospective adoption of ASUs 2014-09 and 2017-07 | |||||||
| VISHAY INTERTECHNOLOGY, INC. | |||||||
| Consolidated Statements of Cash Flows | |||||||
| (Unaudited - in thousands) | |||||||
| Nine fiscal months ended | |||||||
| September 29, 2018 | September 30, 2017 | ||||||
| Operating activities | |||||||
| Net earnings | $ | 243,878 | $ | 157,941 | |||
| Adjustments to reconcile net earnings (loss) to | |||||||
| net cash provided by operating activities: | |||||||
| Depreciation and amortization | 121,888 | 121,319 | |||||
| (Gain) loss on disposal of property and equipment | (2,216 | ) | (106 | ) | |||
| Accretion of interest on convertible debt instruments | 6,966 | 3,703 | |||||
| Inventory write-offs for obsolescence | 17,059 | 12,157 | |||||
| Loss on disposal of equity affiliate | - | 7,060 | |||||
| Loss on early extinguishment of debt | 17,309 | - | |||||
| Deferred income taxes | (12,348 | ) | 9,115 | ||||
| Other | 13,021 | 6,531 | |||||
| U.S. transition tax | (14,400 | ) | - | ||||
| Repatriation taxes | (156,767 | ) | - | ||||
| Changes in operating assets and liabilities, net of effects of businesses acquired | (125,499 | ) | (71,875 | ) | |||
| Net cash provided by operating activities | 108,891 | 245,845 | |||||
| Investing activities | |||||||
| Purchase of property and equipment | (126,391 | ) | (84,790 | ) | |||
| Proceeds from sale of property and equipment | 8,455 | 1,484 | |||||
| Purchase of businesses, net of cash acquired | (14,880 | ) | - | ||||
| Purchase of short-term investments | (172,732 | ) | (598,937 | ) | |||
| Maturity of short-term investments | 577,524 | 610,573 | |||||
| Other investing activities | (1,608 | ) | (6,663 | ) | |||
| Net cash provided by (used in) investing activities | 270,368 | (78,333 | ) | ||||
| Financing activities | |||||||
| Proceeds from long-term borrowings | 600,000 | - | |||||
| Issuance costs | (15,621 | ) | - | ||||
| Repurchase of convertible debentures | (584,991 | ) | - | ||||
| Net proceeds (payments) on revolving credit lines | (150,000 | ) | (5,000 | ) | |||
| Common stock repurchases | - | (37,564 | ) | ||||
| Net changes in short-term borrowings | - | 22 | |||||
| Dividends paid to common stockholders | (31,378 | ) | (25,054 | ) | |||
| Dividends paid to Class B common stockholders | (2,873 | ) | (2,274 | ) | |||
| Proceeds from stock options exercised | - | 1,260 | |||||
| Distributions to noncontrolling interests | (525 | ) | (1,140 | ) | |||
| Acquisition of noncontrolling interests | - | (4,100 | ) | ||||
| Cash withholding taxes paid when shares withheld for vested equity awards | (2,297 | ) | (1,971 | ) | |||
| Other financing activities | - | (1,255 | ) | ||||
| Net cash used in financing activities | (187,685 | ) | (77,076 | ) | |||
| Effect of exchange rate changes on cash and cash equivalents | (11,501 | ) | 13,168 | ||||
| Net increase in cash and cash equivalents | 180,073 | 103,604 | |||||
| Cash and cash equivalents at beginning of period | 748,032 | 471,781 | |||||
| Cash and cash equivalents at end of period | $ | 928,105 | $ | 575,385 | |||
| VISHAY INTERTECHNOLOGY, INC. | ||||||||||||||||||
| Reconciliation of Adjusted Earnings Per Share | ||||||||||||||||||
| (Unaudited - In thousands, except per share amounts) | ||||||||||||||||||
| Fiscal quarters ended | Nine fiscal months ended | |||||||||||||||||
| September 29, 2018 | June 30, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||||
| GAAP net earnings attributable to Vishay stockholders | $ | 77,876 | $ | 103,097 | $ | 64,404 | $ | 243,339 | $ | 157,313 | ||||||||
| Reconciling items affecting operating income: | ||||||||||||||||||
| Restructuring and severance costs | $ | - | $ | - | $ | 3,244 | $ | - | $ | 5,194 | ||||||||
| Reconciling items affecting other income (expense): | ||||||||||||||||||
| Loss on early extinguishment of debt | $ | - | $ | 17,309 | $ | - | $ | 17,309 | $ | - | ||||||||
| Loss on disposal of equity affiliate | - | - | - | - | 7,060 | |||||||||||||
| Reconciling items affecting tax expense (benefit): | ||||||||||||||||||
| Enactment of TCJA | $ | 13,496 | $ | 12,000 | $ | - | $ | 25,496 | $ | - | ||||||||
| Effects of cash repatriation program | 680 | (9,006 | ) | (892 | ) | (7,010 | ) | (3,100 | ) | |||||||||
| Change in deferred taxes due to early extinguishment of debt | - | (33,963 | ) | - | (33,963 | ) | - | |||||||||||
| Effects of changes in uncertain tax positions | - | - | (804 | ) | - | (804 | ) | |||||||||||
| Tax effects of pre-tax items above | - | (3,784 | ) | (674 | ) | (3,784 | ) | (1,271 | ) | |||||||||
| Adjusted net earnings | $ | 92,052 | $ | 85,653 | $ | 65,278 | $ | 241,387 | $ | 164,392 | ||||||||
| Adjusted weighted average diluted shares outstanding | 152,946 | 157,657 | 156,701 | 156,702 | 155,626 | |||||||||||||
| Adjusted earnings per diluted share | $ | 0.60 | $ | 0.54 | $ | 0.42 | $ | 1.54 | $ | 1.06 | ||||||||
| VISHAY INTERTECHNOLOGY, INC. | |||||||||||||||||||
| Reconciliation of Free Cash | |||||||||||||||||||
| (Unaudited - In thousands) | |||||||||||||||||||
| Fiscal quarters ended | Nine fiscal months ended | ||||||||||||||||||
| September 29, 2018 | June 30, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |||||||||||||||
| Net cash provided by (used in) operating activities | $ | 70,721 | $ | (8,689 | ) | $ | 117,579 | $ | 108,891 | $ | 245,845 | ||||||||
| Proceeds from sale of property and equipment | 77 | 8,194 | 196 | 8,455 | 1,484 | ||||||||||||||
| Less: Capital expenditures | (49,745 | ) | (48,373 | ) | (35,723 | ) | (126,391 | ) | (84,790 | ) | |||||||||
| Free cash | $ | 21,053 | $ | (48,868 | ) | $ | 82,052 | $ | (9,045 | ) | $ | 162,539 | |||||||
| VISHAY INTERTECHNOLOGY, INC. | |||||||||||||||||||
| Reconciliation of EBITDA and Adjusted EBITDA | |||||||||||||||||||
| (Unaudited - In thousands) | |||||||||||||||||||
| Fiscal quarters ended | Nine fiscal months ended | ||||||||||||||||||
| September 29, 2018 | June 30, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |||||||||||||||
| GAAP net earnings attributable to Vishay stockholders | $ | 77,876 | $ | 103,097 | $ | 64,404 | $ | 243,339 | $ | 157,313 | |||||||||
| Net earnings attributable to noncontrolling interests | 195 | 165 | 179 | 539 | 628 | ||||||||||||||
| Net earnings | $ | 78,071 | $ | 103,262 | $ | 64,583 | $ | 243,878 | $ | 157,941 | |||||||||
| Interest expense | $ | 10,813 | $ | 8,372 | $ | 6,938 | $ | 26,862 | $ | 20,804 | |||||||||
| Interest income | (3,504 | ) | (2,762 | ) | (1,802 | ) | (8,302 | ) | (4,599 | ) | |||||||||
| Income taxes | 48,737 | (5,703 | ) | 21,605 | 72,508 | 54,398 | |||||||||||||
| Depreciation and amortization | 40,714 | 40,616 | 40,939 | 121,888 | 121,319 | ||||||||||||||
| EBITDA | $ | 174,831 | $ | 143,785 | $ | 132,263 | $ | 456,834 | $ | 349,863 | |||||||||
| Reconciling items | |||||||||||||||||||
| Restructuring and severance costs | $ | - | $ | - | $ | 3,244 | $ | - | $ | 5,194 | |||||||||
| Loss on early extinguishment of debt | - | 17,309 | - | 17,309 | - | ||||||||||||||
| Loss on disposal of equity affiliate | - | - | - | - | 7,060 | ||||||||||||||
| Adjusted EBITDA | $ | 174,831 | $ | 161,094 | $ | 135,507 | $ | 474,143 | $ | 362,117 | |||||||||
| Adjusted EBITDA margin** | 22.4 | % | 21.2 | % | 20.0 | % | 21.0 | % | 18.8 | % | |||||||||
| ** Adjusted EBITDA as a percentage of net revenues | |||||||||||||||||||