EX-99.1 2 exhibit99-1.htm EXHIBIT 99.1
Exhibit 99.1
 
 
VISHAY REPORTS RESULTS FOR SECOND QUARTER 2018
 
 
·
Revenues for Q2 2018 of $761 million
·
Gross Margin Q2 of 29.9%
·
Operating Margin Q2 of 16.2%
·
EPS Q2 of $0.65
·
Adjusted EPS Q2 of $0.54
·
Guidance for Q3 2018 for revenues of $755 to $795 million and gross margins of 29.0% to 30.0% at Q2 exchange rates
·
Distribution: point of sales Q2 14% over prior year and inventory turns of 3.7
·
Repatriated $274 million and paid $92 million of related foreign taxes
·
Cash from operations for trailing twelve months Q2 of $279 million and capital expenditures of $198 million
·
Both Q2 and trailing twelve months Q2 cash from operations include $106 million of cash taxes paid related to US Tax Reform and cash repatriation
 
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 six fiscal months ended June 30, 2018.

Revenues for the fiscal quarter ended June 30, 2018 were $761.0 million, compared to $716.8 million for the fiscal quarter ended March 31, 2018, and $643.2 million for the fiscal quarter ended July 1, 2017.  Net earnings attributable to Vishay stockholders for the fiscal quarter ended June 30, 2018 were $103.1 million, or $0.65 per diluted share, compared to $62.4 million, or $0.39 per diluted share for the fiscal quarter ended March 31, 2018, and $56.2 million, or $0.36 per diluted share for the fiscal quarter ended July 1, 2017.

As summarized on the attached reconciliation schedule, all periods presented include items affecting comparability.  Net earnings for the fiscal quarter ended June 30, 2018 have been favorably impacted by such items, primarily a change in deferred taxes related to special tax attributes of debt instruments which were repurchased during the quarter.  Adjusted earnings per diluted share, which exclude these items net of tax and the unusual tax items, were $0.54, $0.40, and $0.36 for the fiscal quarters ended June 30, 2018, March 31, 2018, and July 1, 2017, respectively.

Commenting on the results for the second quarter 2018, Dr. Gerald Paul, President and Chief Executive Officer, stated, "In the second quarter, Vishay again continued to enjoy excellent business conditions in virtually all markets and, again, Vishay's key markets of automotive and industrial show unbroken strength."

"As we announced earlier, we trust in an accelerated growth trend of our markets—in particular, the automotive and industrial end markets—for the years to come. We prepare ourselves by continuing to expand manufacturing capacities for our constrained key product lines while remaining careful in adding operational fixed costs."

Commenting on the outlook Dr. Paul stated, "Based on our ongoing capacity expansion and the number of working days in the quarter, we guide for the third quarter for revenues of $755 to $795 million and gross margins of 29.0% to 30.0% at the exchange rates for the second quarter."

A conference call to discuss Vishay's second quarter financial results is scheduled for Tuesday, August 7, 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 2279867.

There will be a replay of the conference call from 12:00 p.m. ET on Tuesday, August 7, 2018 through 11:59 p.m. ET on Tuesday, August 14, 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 2279867.

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, manufacturing capacities, customer confidence, anticipated growth areas for the company, 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; 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 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.
 
 
VISHAY INTERTECHNOLOGY, INC.
                  
Summary of Operations
                  
(Unaudited - In thousands, except per share amounts)
                  
                   
   
Fiscal quarters ended
  
   
June 30, 2018
    
March 31, 2018
    
July 1, 2017*
  
                   
Net revenues
  
$
761,030
    
$
716,795
    
$
643,164
  
Costs of products sold
    
533,792
      
511,495
      
469,327
  
Gross profit
    
227,238
      
205,300
      
173,837
  
  Gross margin
    
29.9
%
    
28.6
%
    
27.0
%
                         
Selling, general, and administrative expenses
    
103,945
      
101,238
      
88,351
  
Restructuring and severance costs
    
-
      
-
      
481
  
Operating income
    
123,293
      
104,062
      
85,005
  
  Operating margin
    
16.2
%
    
14.5
%
    
13.2
%
                         
Other income (expense):
                        
  Interest expense
    
(8,372
)
    
(7,677
)
    
(7,076
)
  Other components of net periodic pension cost
    
(3,450
)
    
(3,519
)
    
(2,969
)
  Other
    
3,397
      
(847
)
    
749
  
  Loss on early extinguishment of debt
    
(17,309
)
    
-
      
-
  
  Total other income (expense) - net
    
(25,734
)
    
(12,043
)
    
(9,296
)
                         
Income before taxes
    
97,559
      
92,019
      
75,709
  
                         
Income taxes
    
(5,703
)
    
29,474
      
19,300
  
                         
Net earnings
    
103,262
      
62,545
      
56,409
  
                         
Less: net earnings attributable to noncontrolling interests
    
165
      
179
      
219
  
                         
Net earnings attributable to Vishay stockholders
  
$
103,097
    
$
62,366
    
$
56,190
  
                         
Basic earnings per share attributable to Vishay stockholders
  
$
0.71
    
$
0.43
    
$
0.38
  
                         
Diluted earnings per share attributable to Vishay stockholders
  
$
0.65
    
$
0.39
    
$
0.36
  
                         
Weighted average shares outstanding - basic
    
144,382
      
144,327
      
146,381
  
                         
Weighted average shares outstanding - diluted
    
157,657
      
159,502
      
155,300
  
                         
Cash dividends per share
  
$
0.0850
    
$
0.0675
    
$
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)
            
             
   
Six fiscal months ended
  
   
June 30, 2018
    
July 1, 2017*
  
             
Net revenues
  
$
1,477,825
    
$
1,247,965
  
Costs of products sold
    
1,045,287
      
912,379
  
Gross profit
    
432,538
      
335,586
  
  Gross margin
    
29.3
%
    
26.9
%
                 
Selling, general, and administrative expenses
    
205,183
      
181,053
  
Restructuring and severance costs
    
-
      
1,950
  
Operating income
    
227,355
      
152,583
  
  Operating margin
    
15.4
%
    
12.2
%
                 
Other income (expense):
                
  Interest expense
    
(16,049
)
    
(13,866
)
  Other components of net periodic pension cost
    
(6,969
)
    
(5,859
)
  Other
    
2,550
      
353
  
  Loss on early extinguishment of debt
    
(17,309
)
    
-
  
  Loss on disposal of equity affiliate
    
-
      
(7,060
)
  Total other income (expense) - net
    
(37,777
)
    
(26,432
)
                 
Income before taxes
    
189,578
      
126,151
  
                 
Income taxes
    
23,771
      
32,793
  
                 
Net earnings
    
165,807
      
93,358
  
                 
Less: net earnings attributable to noncontrolling interests
    
344
      
449
  
                 
Net earnings attributable to Vishay stockholders
  
$
165,463
    
$
92,909
  
                 
Basic earnings per share attributable to Vishay stockholders
  
$
1.15
    
$
0.63
  
                 
Diluted earnings per share attributable to Vishay stockholders
  
$
1.04
    
$
0.60
  
                 
Weighted average shares outstanding - basic
    
144,355
      
146,328
  
                 
Weighted average shares outstanding - diluted
    
158,580
      
155,088
  
                 
Cash dividends per share
  
$
0.1525
    
$
0.1250
  
                 
*Recast for the retrospective adoption of ASUs 2014-09 and 2017-07
                
 
 
VISHAY INTERTECHNOLOGY, INC.
            
Consolidated Condensed Balance Sheets
            
(Unaudited - in thousands)
            
             
   
June 30, 2018
    
December 31, 2017*
  
             
Assets
            
Current assets:
            
  Cash and cash equivalents
  
$
1,007,056
    
$
748,032
  
  Short-term investments
    
142,690
      
547,136
  
  Accounts receivable, net
    
395,745
      
340,027
  
  Inventories:
                
    Finished goods
    
138,745
      
127,272
  
    Work in process
    
191,546
      
170,319
  
    Raw materials
    
149,630
      
132,068
  
  Total inventories
    
479,921
      
429,659
  
                 
  Prepaid expenses and other current assets
    
118,809
      
130,336
  
Total current assets
    
2,144,221
      
2,195,190
  
                 
Property and equipment, at cost:
                
  Land
    
86,919
      
92,285
  
  Buildings and improvements
    
607,232
      
606,168
  
  Machinery and equipment
    
2,438,523
      
2,415,769
  
  Construction in progress
    
94,911
      
103,058
  
  Allowance for depreciation
    
(2,330,960
)
    
(2,311,522
)
     
896,625
      
905,758
  
                 
Goodwill
    
147,645
      
142,742
  
                 
Other intangible assets, net
    
70,599
      
69,754
  
                 
Other assets
    
143,097
      
148,645
  
     Total assets
  
$
3,402,187
    
$
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)
            
             
   
June 30, 2018
    
December 31, 2017*
  
             
Liabilities and stockholders' equity
            
Current liabilities:
            
  Notes payable to banks
  
$
123
    
$
4
  
  Trade accounts payable
    
212,111
      
222,373
  
  Payroll and related expenses
    
137,487
      
135,702
  
  Other accrued expenses
    
161,986
      
154,230
  
  Income taxes
    
39,065
      
50,226
  
Total current liabilities
    
550,772
      
562,535
  
                 
Long-term debt less current portion
    
679,598
      
370,470
  
U.S. transition tax payable
    
151,200
      
151,200
  
Deferred income taxes
    
207,072
      
336,465
  
Other liabilities
    
79,925
      
75,249
  
Accrued pension and other postretirement costs
    
268,287
      
281,701
  
Total liabilities
    
1,936,854
      
1,777,620
  
                 
Redeemable convertible debentures
    
79,544
      
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
    
1,593,942
      
1,752,506
  
  Retained earnings (accumulated deficit)
    
(217,008
)
    
(362,254
)
  Accumulated other comprehensive income (loss)
    
(7,418
)
    
25,714
  
  Total Vishay stockholders' equity
    
1,383,938
      
1,430,367
  
Noncontrolling interests
    
1,851
      
2,032
  
Total equity
    
1,385,789
      
1,432,399
  
Total liabilities, temporary equity, and equity
  
$
3,402,187
    
$
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)
            
   
Six fiscal months ended
  
   
June 30, 2018
    
July 1, 2017
  
             
Operating activities
            
Net earnings
  
$
165,807
    
$
93,358
  
Adjustments to reconcile net earnings (loss) to
                
    net cash provided by operating activities:
                
      Depreciation and amortization
    
81,174
      
80,380
  
      (Gain) loss on disposal of property and equipment
    
(2,242
)
    
(51
)
      Accretion of interest on convertible debt instruments
    
2,964
      
2,444
  
      Inventory write-offs for obsolescence
    
11,799
      
9,729
  
      Loss on disposal of equity affiliate
    
-
      
7,060
  
      Loss on early extinguishment of debt
    
17,309
      
-
  
      Deferred income taxes
    
(25,669
)
    
6,640
  
      Other
    
4,148
      
2,579
  
      U.S. transition tax
    
(14,400
)
    
-
  
      Repatriation taxes
    
(92,093
)
    
-
  
      Changes in operating assets and liabilities, net of effects of businesses acquired
    
(110,627
)
    
(73,873
)
Net cash provided by operating activities
    
38,170
      
128,266
  
                 
Investing activities
                
Purchase of property and equipment
    
(76,646
)
    
(49,067
)
Proceeds from sale of property and equipment
    
8,378
      
1,288
  
Purchase of businesses, net of cash acquired
    
(14,880
)
    
-
  
Purchase of short-term investments
    
(50,193
)
    
(418,114
)
Maturity of short-term investments
    
447,359
      
454,918
  
Other investing activities
    
(935
)
    
(6,664
)
Net cash provided by (used in) investing activities
    
313,083
      
(17,639
)
                 
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
    
(54,000
)
    
(10,000
)
Net changes in short-term borrowings
    
119
      
7
  
Dividends paid to common stockholders
    
(20,148
)
    
(16,761
)
Dividends paid to Class B common stockholders
    
(1,845
)
    
(1,516
)
Proceeds from stock options exercised
    
-
      
1,260
  
Distributions to noncontrolling interests
    
(525
)
    
(740
)
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
    
(79,308
)
    
(30,976
)
Effect of exchange rate changes on cash and cash equivalents
    
(12,921
)
    
9,600
  
                 
Net increase in cash and cash equivalents
    
259,024
      
89,251
  
                 
Cash and cash equivalents at beginning of period
    
748,032
      
471,781
  
Cash and cash equivalents at end of period
  
$
1,007,056
    
$
561,032
  
 
 
VISHAY INTERTECHNOLOGY, INC.
                              
Reconciliation of Adjusted Earnings Per Share
                          
(Unaudited - In thousands, except per share amounts)
                          
   
Fiscal quarters ended
    
Six fiscal months ended
  
   
June 30, 2018
    
March 31, 2018
    
July 1, 2017
    
June 30, 2018
    
July 1, 2017
  
                               
GAAP net earnings attributable to Vishay stockholders
  
$
103,097
    
$
62,366
    
$
56,190
    
$
165,463
    
$
92,909
  
                                         
Reconciling items affecting operating income:
                                  
Restructuring and severance costs
  
$
-
    
$
-
    
$
481
    
$
-
    
$
1,950
  
                                         
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
  
$
12,000
    
$
-
    
$
-
    
$
12,000
    
$
-
  
Effects of cash repatriation program
    
(9,006
)
    
1,316
      
(1,240
)
    
(7,690
)
    
(2,208
)
Change in deferred taxes due to early extinguishment of debt
    
(33,963
)
    
-
      
-
      
(33,963
)
    
-
  
Tax effects of pre-tax items above
    
(3,784
)
    
-
      
(156
)
    
(3,784
)
    
(597
)
                                         
Adjusted net earnings
  
$
85,653
    
$
63,682
    
$
55,275
    
$
149,335
    
$
99,114
  
                                         
Adjusted weighted average diluted shares outstanding
    
157,657
      
159,502
      
155,300
      
158,580
      
155,088
  
                                         
Adjusted earnings per diluted share
  
$
0.54
    
$
0.40
    
$
0.36
    
$
0.94
    
$
0.64
  
 
 
VISHAY INTERTECHNOLOGY, INC.
                          
Reconciliation of Free Cash
                              
(Unaudited - In thousands)
                              
   
Fiscal quarters ended
    
Six fiscal months ended
  
   
June 30, 2018
    
March 31, 2018
    
July 1, 2017
    
June 30, 2018
    
July 1, 2017
  
Net cash provided by (used in) operating activities
  
$
(8,689
)
  
$
46,859
    
$
84,592
    
$
38,170
    
$
128,266
  
Proceeds from sale of property and equipment
    
8,194
      
184
      
345
      
8,378
      
1,288
  
Less: Capital expenditures
    
(48,373
)
    
(28,273
)
    
(32,399
)
    
(76,646
)
    
(49,067
)
Free cash
  
$
(48,868
)
  
$
18,770
    
$
52,538
    
$
(30,098
)
  
$
80,487
  
 
 
VISHAY INTERTECHNOLOGY, INC.
                          
Reconciliation of EBITDA and Adjusted EBITDA
                    
(Unaudited - In thousands)
                              
   
Fiscal quarters ended
    
Six fiscal months ended
  
   
June 30, 2018
    
March 31, 2018
    
July 1, 2017
    
June 30, 2018
    
July 1, 2017
  
                               
GAAP net earnings attributable to Vishay stockholders
  
$
103,097
    
$
62,366
    
$
56,190
    
$
165,463
    
$
92,909
  
Net earnings attributable to noncontrolling interests
    
165
      
179
      
219
      
344
      
449
  
Net earnings
  
$
103,262
    
$
62,545
    
$
56,409
    
$
165,807
    
$
93,358
  
                                         
Interest expense
  
$
8,372
    
$
7,677
    
$
7,076
    
$
16,049
    
$
13,866
  
Interest income
    
(2,762
)
    
(2,036
)
    
(1,534
)
    
(4,798
)
    
(2,797
)
Income taxes
    
(5,703
)
    
29,474
      
19,300
      
23,771
      
32,793
  
Depreciation and amortization
    
40,616
      
40,558
      
40,168
      
81,174
      
80,380
  
EBITDA
  
$
143,785
    
$
138,218
    
$
121,419
    
$
282,003
    
$
217,600
  
                                         
Reconciling items
                                        
Restructuring and severance costs
  
$
-
    
$
-
    
$
481
    
$
-
    
$
1,950
  
Loss on early extinguishment of debt
    
17,309
      
-
      
-
      
17,309
      
-
  
Loss on disposal of equity affiliate
    
-
      
-
      
-
      
-
      
7,060
  
                                         
Adjusted EBITDA
  
$
161,094
    
$
138,218
    
$
121,900
    
$
299,312
    
$
226,610
  
                                         
Adjusted EBITDA margin**
    
21.2
%
    
19.3
%
    
19.0
%
    
20.3
%
    
18.2
%
                                         
** Adjusted EBITDA as a percentage of net revenues
                          

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