(Mark One) | |||||
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
For the quarterly period ended | July 2, 2011 | ||||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
For the transition period from ________ to ________ |
Delaware | 38-1686453 | |||
(State or Other Jurisdiction of Incorporation) | (I.R.S. Employer Identification Number) | |||
63 Lancaster Avenue | ||||
Malvern, PA 19355-2143 | 610-644-1300 | |||
(Address of Principal Executive Offices) | (Registrant’s Area Code and Telephone Number) |
Large accelerated filer x | Accelerated filer o |
Non-accelerated filer o (Do not check if smaller reporting company) | Smaller reporting company o |
Page Number | ||||||
PART I. | FINANCIAL INFORMATION | |||||
Item 1. | Financial Statements | |||||
Consolidated Condensed Balance Sheets | ||||||
(Unaudited) – July 2, 2011 and December 31, 2010 | 4 | |||||
Consolidated Condensed Statements of Operations | ||||||
(Unaudited) – Fiscal Quarters Ended July 2, 2011 and | ||||||
July 3, 2010 | 6 | |||||
Consolidated Condensed Statements of Operations | ||||||
(Unaudited) – Six Fiscal Months Ended July 2, 2011 and | ||||||
July 3, 2010 | 7 | |||||
Consolidated Condensed Statements of Cash Flows | ||||||
(Unaudited) – Six Fiscal Months Ended July 2, 2011 and | ||||||
July 3, 2010 | 8 | |||||
Consolidated Condensed Statement of Equity | ||||||
(Unaudited) | 9 | |||||
Notes to Consolidated Condensed Financial Statements | ||||||
(Unaudited) | 10 | |||||
Item 2. | Management’s Discussion and Analysis of Financial | |||||
Condition and Results of Operations | 31 | |||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 53 | ||||
Item 4. | Controls and Procedures | 53 | ||||
PART II. | OTHER INFORMATION | |||||
Item 1. | Legal Proceedings | 54 | ||||
Item 1A. | Risk Factors | 54 | ||||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 54 | ||||
Item 3. | Defaults Upon Senior Securities | 55 | ||||
Item 4. | Removed and Reserved | 55 | ||||
Item 5. | Other Information | 55 | ||||
Item 6. | Exhibits | 55 | ||||
SIGNATURES | 56 |
July 2, | December 31, | |||||||
2011 | 2010 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 692,592 | $ | 897,338 | ||||
Short-term investments | 314,408 | - | ||||||
Accounts receivable, net | 345,121 | 330,556 | ||||||
Inventories: | ||||||||
Finished goods | 122,594 | 109,762 | ||||||
Work in process | 192,743 | 178,844 | ||||||
Raw materials | 160,955 | 139,216 | ||||||
Total inventories | 476,292 | 427,822 | ||||||
Deferred income taxes | 32,831 | 31,903 | ||||||
Prepaid expenses and other current assets | 140,565 | 106,885 | ||||||
Total current assets | 2,001,809 | 1,794,504 | ||||||
Property and equipment, at cost: | ||||||||
Land | 95,120 | 93,020 | ||||||
Buildings and improvements | 502,452 | 477,518 | ||||||
Machinery and equipment | 2,118,260 | 2,025,793 | ||||||
Construction in progress | 62,938 | 75,051 | ||||||
Allowance for depreciation | (1,872,985 | ) | (1,759,268 | ) | ||||
905,785 | 912,114 | |||||||
Intangible assets, net | 106,575 | 113,830 | ||||||
Other assets | 142,526 | 145,645 | ||||||
Total assets | $ | 3,156,695 | $ | 2,966,093 | ||||
July 2, | December 31, | |||||||
2011 | 2010 | |||||||
Liabilities and equity | ||||||||
Current liabilities: | ||||||||
Notes payable to banks | $ | 12 | $ | 23 | ||||
Trade accounts payable | 184,256 | 167,795 | ||||||
Payroll and related expenses | 119,163 | 122,234 | ||||||
Other accrued expenses | 170,638 | 186,049 | ||||||
Income taxes | 60,282 | 51,060 | ||||||
Total current liabilities | 534,351 | 527,161 | ||||||
Long-term debt less current portion | 422,422 | 431,682 | ||||||
Deferred income taxes | 119,551 | 82,043 | ||||||
Deferred grant income | 2,477 | 2,788 | ||||||
Other liabilities | 133,203 | 134,152 | ||||||
Accrued pension and other postretirement costs | 298,467 | 291,117 | ||||||
Total liabilities | 1,510,471 | 1,468,943 | ||||||
Stockholders' equity: | ||||||||
Vishay stockholders' equity | ||||||||
Common stock | 14,359 | 15,061 | ||||||
Class B convertible common stock | 1,345 | 1,435 | ||||||
Capital in excess of par value | 2,082,649 | 2,156,981 | ||||||
(Accumulated deficit) retained earnings | (584,855 | ) | (742,237 | ) | ||||
Accumulated other comprehensive income (loss) | 127,086 | 60,491 | ||||||
Total Vishay stockholders' equity | 1,640,584 | 1,491,731 | ||||||
Noncontrolling interests | 5,640 | 5,419 | ||||||
Total equity | 1,646,224 | 1,497,150 | ||||||
Total liabilities and equity | $ | 3,156,695 | $ | 2,966,093 | ||||
Fiscal quarters ended | ||||||||
July 2, | July 3, | |||||||
2011 | 2010 | |||||||
Net revenues | $ | 709,838 | $ | 701,655 | ||||
Costs of products sold | 497,648 | 491,062 | ||||||
Gross profit | 212,190 | 210,593 | ||||||
Selling, general, and administrative expenses | 92,796 | 109,266 | ||||||
Executive compensation charge | 3,889 | - | ||||||
Operating income | 115,505 | 101,327 | ||||||
Other income (expense): | ||||||||
Interest expense | (4,624 | ) | (2,400 | ) | ||||
Other | (28 | ) | 5,956 | |||||
(4,652 | ) | 3,556 | ||||||
Income before taxes | 110,853 | 104,883 | ||||||
Income tax expense | 28,357 | 27,918 | ||||||
Net earnings | 82,496 | 76,965 | ||||||
Less: net earnings attributable to noncontrolling interests | 401 | 306 | ||||||
Net earnings attributable to Vishay stockholders | $ | 82,095 | $ | 76,659 | ||||
Basic earnings per share attributable to Vishay stockholders | $ | 0.51 | $ | 0.41 | ||||
Diluted earnings per share attributable to Vishay stockholders | $ | 0.48 | $ | 0.40 | ||||
Weighted average shares outstanding - basic | 160,801 | 186,667 | ||||||
Weighted average shares outstanding - diluted | 170,645 | 193,084 |
Six fiscal months ended | ||||||||
July 2, | July 3, | |||||||
2011 | 2010 | |||||||
Net revenues | $ | 1,404,989 | $ | 1,342,115 | ||||
Costs of products sold | 978,136 | 964,509 | ||||||
Gross profit | 426,853 | 377,606 | ||||||
Selling, general, and administrative expenses | 185,261 | 211,154 | ||||||
Executive compensation charge | 3,889 | - | ||||||
Operating income | 237,703 | 166,452 | ||||||
Other income (expense): | ||||||||
Interest expense | (8,678 | ) | (4,834 | ) | ||||
Other | (535 | ) | 6,000 | |||||
(9,213 | ) | 1,166 | ||||||
Income before taxes | 228,490 | 167,618 | ||||||
Income taxes | 70,387 | 45,014 | ||||||
Net earnings | 158,103 | 122,604 | ||||||
Less: net earnings attributable to noncontrolling interests | 721 | 525 | ||||||
Net earnings attributable to Vishay stockholders | $ | 157,382 | $ | 122,079 | ||||
Basic earnings per share attributable to Vishay stockholders | $ | 0.97 | $ | 0.65 | ||||
Diluted earnings per share attributable to Vishay stockholders | $ | 0.91 | $ | 0.63 | ||||
Weighted average shares outstanding - basic | 163,006 | 186,654 | ||||||
Weighted average shares outstanding - diluted | 173,143 | 193,076 | ||||||
See accompanying notes. |
Six fiscal months ended | ||||||||
July 2, | July 3, | |||||||
2011 | 2010 | |||||||
Continuing operating activities | ||||||||
Net earnings | $ | 158,103 | $ | 122,604 | ||||
Adjustments to reconcile net earnings to | ||||||||
net cash provided by continuing operating activities: | ||||||||
Depreciation and amortization
|
91,512 | 99,262 | ||||||
Gain on disposal of property and equipment
|
(930 | ) | (92 | ) | ||||
Accretion of interest on convertible debentures
|
861 | - | ||||||
Inventory write-offs for obsolescence
|
10,560 | 10,853 | ||||||
Deferred grant income
|
(235 | ) | (313 | ) | ||||
Other
|
3,557 | 13,436 | ||||||
Net change in operating assets and liabilities,
|
||||||||
net of effects of businesses acquired or spun-off
|
(89,512 | ) | (68,199 | ) | ||||
Net cash provided by continuing operating activities | 173,916 | 177,551 | ||||||
Continuing investing activities | ||||||||
Capital expenditures | (45,365 | ) | (49,193 | ) | ||||
Proceeds from sale of property and equipment | 1,473 | 590 | ||||||
Proceeds from loans receivable | - | 15,000 | ||||||
Purchase of short-term investments | (391,524 | ) | - | |||||
Maturity of short-term investments | 82,990 | - | ||||||
Other investing activities | 307 | - | ||||||
Net cash used in continuing investing activities | (352,119 | ) | (33,603 | ) | ||||
Continuing financing activities | ||||||||
Proceeds from long-term borrowings | 150,000 | - | ||||||
Issuance costs | (4,144 | ) | (456 | ) | ||||
Common stock repurchase | (150,000 | ) | - | |||||
Principal payments on long-term debt and capital leases | (6 | ) | (14,129 | ) | ||||
Net payments on revolving credit lines | (60,000 | ) | - | |||||
Net changes in short-term borrowings | (9 | ) | 554 | |||||
Proceeds from stock options exercised | 7,938 | - | ||||||
Excess tax benefit from stock options exercised | 555 | - | ||||||
Distributions to noncontrolling interests | (500 | ) | (516 | ) | ||||
Net cash used in continuing financing activities | (56,166 | ) | (14,547 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | 29,623 | (33,927 | ) | |||||
Net (decrease) increase in cash and cash equivalents | ||||||||
from continuing activities | (204,746 | ) | 95,474 | |||||
Net cash used in discontinued operating activities | - | (82 | ) | |||||
Net cash used in discontinued investing activities | - | - | ||||||
Net cash used in discontinued financing activities | - | - | ||||||
Net cash used in discontinued operations | - | (82 | ) | |||||
Net (decrease) increase in cash and cash equivalents | (204,746 | ) | 95,392 | |||||
Cash and cash equivalents at beginning of period | 897,338 | 579,189 | ||||||
Cash and cash equivalents at end of period | $ | 692,592 | $ | 674,581 | ||||
Class B | Retained | Accumulated | Total | ||||||||||||||||||||||||||||
Convertible | Capital in | Earnings | Other | Vishay | |||||||||||||||||||||||||||
Common | Common | Excess of | (Accumulated | Comprehensive | Stockholders' | Noncontrolling | Total | ||||||||||||||||||||||||
Stock | Stock | Par Value | Deficit) | Income (Loss) | Equity | Interests | Equity | ||||||||||||||||||||||||
Balance at January 1, 2011 | $ | 15,061 | $ | 1,435 | $ | 2,156,981 | $ | (742,237 | ) | $ | 60,491 | $ | 1,491,731 | $ | 5,419 | $ | 1,497,150 | ||||||||||||||
Net earnings | - | - | - | 157,382 | - | 157,382 | 721 | 158,103 | |||||||||||||||||||||||
Other comprehensive income | - | - | - | - | 66,595 | 66,595 | - | 66,595 | |||||||||||||||||||||||
Comprehensive income | 223,977 | 721 | 224,698 | ||||||||||||||||||||||||||||
Distributions to noncontrolling interests | - | - | - | - | - | - | (500 | ) | (500 | ) | |||||||||||||||||||||
Phantom and restricted stock | |||||||||||||||||||||||||||||||
issuances (167,629 shares) | 17 | - | (128 | ) | - | - | (111 | ) | - | (111 | ) | ||||||||||||||||||||
Issuance of convertible debentures due 2041 | - | - | 61,758 | - | - | 61,758 | - | 61,758 | |||||||||||||||||||||||
Stock repurchase (8,620,689 shares) | (862 | ) | - | (149,138 | ) | - | - | (150,000 | ) | - | (150,000 | ) | |||||||||||||||||||
Stock compensation expense | - | - | 4,736 | - | - | 4,736 | - | 4,736 | |||||||||||||||||||||||
Stock options exercised (533,731 shares) | 53 | - | 7,885 | - | - | 7,938 | - | 7,938 | |||||||||||||||||||||||
Tax effects of stock plan | - | - | 555 | - | - | 555 | - | 555 | |||||||||||||||||||||||
Conversions from Class B | |||||||||||||||||||||||||||||||
to common stock (900,290 shares) | 90 | (90 | ) | - | - | - | - | - | - | ||||||||||||||||||||||
Balance at July 2, 2011 | $ | 14,359 | $ | 1,345 | $ | 2,082,649 | $ | (584,855 | ) | $ | 127,086 | $ | 1,640,584 | $ | 5,640 | $ | 1,646,224 | ||||||||||||||
July 2, | December 31, | |||||
2011 | 2010 | |||||
Credit facility | $ | 180,000 | $ | 240,000 | ||
Exchangeable unsecured notes, due 2102 | 95,042 | 95,042 | ||||
Convertible senior debentures, due 2040 | 97,407 | 96,640 | ||||
Convertible senior debentures, due 2041 | 49,973 | - | ||||
422,422 | 431,682 | |||||
Less current portion | - | - | ||||
$ | 422,422 | $ | 431,682 | |||
July 2, | ||||
2011 | ||||
Liability component: | ||||
Principal amount of the debentures | $ | 150,000 | ||
Unamortized discount | (100,240 | ) | ||
Embedded derivative | 213 | |||
Carrying value of liability component | $ | 49,973 | ||
Equity component - net carrying value | $ | 61,758 | ||
Fiscal quarter and six | ||
fiscal months ended | ||
July 2, 2011 | ||
Contractual coupon interest | $ | 441 |
Non-cash amortization of debt discount | 102 | |
Non-cash amortization of deferred financing costs | 6 | |
Non-cash change in value of derivative liability | 2 | |
Total interest expense related to the debentures | $ | 551 |
July 2, | December 31, | |||||||
2011 | 2010 | |||||||
Liability component: | ||||||||
Principal amount of the debentures | $ | 275,000 | $ | 275,000 | ||||
Unamortized discount | (177,920 | ) | (178,679 | ) | ||||
Embedded derivative | 327 | 319 | ||||||
Carrying value of liability component | $ | 97,407 | $ | 96,640 | ||||
Equity component - net carrying value | $ | 110,094 | $ | 110,094 | ||||
Fiscal quarter ended | Six fiscal months ended | |||||
July 2, 2011 | July 2, 2011 | |||||
Contractual coupon interest | $ | 1,547 | $ | 3,094 | ||
Non-cash amortization of debt discount | 383 | 759 | ||||
Non-cash amortization of deferred financing costs | 22 | 44 | ||||
Non-cash change in value of derivative liability | 69 | 8 | ||||
Total interest expense related to the debentures | $ | 2,021 | $ | 3,905 | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||||
Net earnings | $ | 82,496 | $ | 76,965 | $ | 158,103 | $ | 122,604 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Foreign currency translation | ||||||||||||||||
adjustment | 18,691 | (50,012 | ) | 64,419 | (79,496 | ) | ||||||||||
Unrealized gain (loss) on available | ||||||||||||||||
for sale securities | (851 | ) | (528 | ) | (240 | ) | (133 | ) | ||||||||
Pension and other postretirement | ||||||||||||||||
adjustments | 482 | (6,768 | ) | 2,416 | (4,998 | ) | ||||||||||
Total other comprehensive income (loss) | 18,322 | (57,308 | ) | 66,595 | (84,627 | ) | ||||||||||
Comprehensive income | $ | 100,818 | $ | 19,657 | $ | 224,698 | $ | 37,977 | ||||||||
Less: Comprehensive income | ||||||||||||||||
attributable to noncontrolling interests | 401 | 306 | 721 | 525 | ||||||||||||
Comprehensive income attributable | ||||||||||||||||
to Vishay stockholders | $ | 100,417 | $ | 19,351 | $ | 223,977 | $ | 37,452 | ||||||||
Fiscal quarters ended | Fiscal quarters ended | |||||||||||||||
July 2, 2011 | July 3, 2010 | |||||||||||||||
U.S. | Non-U.S. | U.S. | Non-U.S. | |||||||||||||
Plans | Plans | Plans | Plans | |||||||||||||
Net service cost | $ | - | $ | 849 | $ | - | $ | 757 | ||||||||
Interest cost | 4,081 | 2,679 | 3,992 | 2,686 | ||||||||||||
Expected return on plan assets | (4,888 | ) | (398 | ) | (4,648 | ) | (457 | ) | ||||||||
Amortization of prior service cost | 612 | - | 158 | - | ||||||||||||
Amortization of losses |
2,201
|
254 | 2,352 | 45 | ||||||||||||
Curtailments and settlements | 148 | - | - | - | ||||||||||||
Net periodic benefit cost | $ | 2,154 | $ | 3,384 | $ | 1,854 | $ | 3,031 | ||||||||
Six fiscal months ended | Six fiscal months ended | |||||||||||||||
July 2, 2011 | July 3, 2010 | |||||||||||||||
U.S. | Non-U.S. | U.S. | Non-U.S. | |||||||||||||
Plans | Plans | Plans | Plans | |||||||||||||
Net service cost | $ | - | $ | 1,676 | $ | - | $ | 1,534 | ||||||||
Interest cost | 8,149 | 5,241 | 8,057 | 5,563 | ||||||||||||
Expected return on plan assets | (9,541 | ) | (789 | ) | (9,049 | ) | (923 | ) | ||||||||
Amortization of prior service cost | 1,253 | - | 202 | - | ||||||||||||
Amortization of losses | 4,303 | 503 | 4,657 | 87 | ||||||||||||
Curtailments and settlements | 148 | - | - | - | ||||||||||||
Net periodic benefit cost | $ | 4,312 |
$
|
6,631 | $ | 3,867 | $ | 6,261 | ||||||||
Fiscal quarter ended | Fiscal quarter ended | |||||||||||||
July 2, 2011 | July 3, 2010 | |||||||||||||
U.S. | Non-U.S. | U.S. | Non-U.S. | |||||||||||
Plans | Plans | Plans | Plans | |||||||||||
Service cost | $ | 20 | $ | 71 | $ | 29 | $ | 61 | ||||||
Interest cost | 146 | 73 | 196 | 70 | ||||||||||
Amortization of prior service (credit) cost | (111 | ) | - | (110 | ) | - | ||||||||
Amortization of transition obligation | 12 | - | 18 | - | ||||||||||
Amortization of gains | (61 | ) | - | (51 | ) | - | ||||||||
Net periodic benefit cost | $ | 6 | $ | 144 | $ | 82 | $ | 131 | ||||||
Six fiscal months ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | |||||||||||||
U.S. | Non-U.S. | U.S. | Non-U.S. | |||||||||||
Plans | Plans | Plans | Plans | |||||||||||
Service cost | $ | 39 | $ | 138 | $ | 57 | $ | 128 | ||||||
Interest cost | 292 | 142 | 391 | 146 | ||||||||||
Amortization of prior service (credit) cost | (221 | ) | - | (220 | ) | - | ||||||||
Amortization of transition obligation | 24 | - | 37 | - | ||||||||||
Amortization of gains | (122 | ) | - | (102 | ) | - | ||||||||
Net periodic benefit cost | $ | 12 | $ | 280 | $ | 163 | $ | 274 | ||||||
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Stock options | $ | (245 | ) | $ | 161 | $ | (125 | ) | $ | 354 | ||||
Restricted stock units | 3,573 | 592 | 4,639 | 812 | ||||||||||
Phantom stock units | - | - | 222 | 175 | ||||||||||
Total | $ | 3,328 | $ | 753 | $ | 4,736 | $ | 1,341 | ||||||
Weighted Average | |||||
Unrecognized | Remaining | ||||
Compensation | Amortization | ||||
Cost | Periods | ||||
Stock options | $ | 208 | 1.6 | ||
Restricted stock units | 6,248 | 1.9 | |||
Phantom stock units | - | 0.0 | |||
Total | $ | 6,456 | |||
Weighted | ||||||||
Weighted | Average | |||||||
Number | Average | Remaining | ||||||
of | Exercise | Contractual | ||||||
Options | Price | Life | ||||||
Outstanding: | ||||||||
January 1, 2011 | 1,254 | $ | 15.04 | |||||
Granted | - | - | ||||||
Exercised | (534 | ) | 14.87 | |||||
Cancelled or forfeited | (40 | ) | 15.18 | |||||
Outstanding at July 2, 2011 | 680 | $ | 15.16 | 1.67 | ||||
Vested and expected to vest | ||||||||
at July 2, 2011 | 680 | $ | 15.16 | 1.67 | ||||
Exercisable at July 2, 2011 | 582 | $ | 15.41 | 1.33 | ||||
Weighted Average | ||||||
Number | grant date | |||||
of | fair value | |||||
RSUs | per unit | |||||
Outstanding: | ||||||
January 1, 2011 | 634 | $ | 9.61 | |||
Granted | 398 | 16.91 | ||||
Vested* | (126 | ) | 10.95 | |||
Cancelled or forfeited | - | - | ||||
Outstanding at July 2, 2011 | 906 | $ | 12.63 | |||
Expected to vest at July 2, 2011 | 906 | |||||
____________________ |
Vesting Date | Number of RSUs | |
January 1, 2013 | 324 | |
January 1, 2014 | 215 |
Number | Grant date | ||||
of | fair value | ||||
Units | per unit | ||||
Outstanding: | |||||
January 1, 2011 | 116 | ||||
Granted | 15 | $ | 14.78 | ||
Redeemed for common stock | (44 | ) | |||
Outstanding at July 2, 2011 | 87 | ||||
Optoelectronic | |||||||||||||||||||||
MOSFETs | Diodes | Components | Resistors & Inductors | Capacitors | Vishay Precision Group | Total | |||||||||||||||
Fiscal quarter ended July 2, 2011: | |||||||||||||||||||||
Product Sales | $ | 153,180 | $ | 169,613 | $ | 63,761 | $ | 167,430 | $ | 154,295 | $ | - | $ | 708,279 | |||||||
Royalty Revenues | 65 | - | - | 1,494 | - | - | $ | 1,559 | |||||||||||||
Total Revenue | $ | 153,245 | $ | 169,613 | $ | 63,761 | $ | 168,924 | $ | 154,295 | $ | - | $ | 709,838 | |||||||
Gross Margin | $ | 42,811 | $ | 43,699 | $ | 21,961 | $ | 58,956 | $ | 44,763 | $ | - | $ | 212,190 | |||||||
Fiscal quarter ended July 3, 2010: | |||||||||||||||||||||
Product Sales | $ | 153,207 | $ | 151,026 | $ | 57,657 | $ | 151,941 | $ | 133,346 | $ | 52,914 | $ | 700,091 | |||||||
Royalty Revenues | 48 | - | 27 | 1,489 | - | - | $ | 1,564 | |||||||||||||
Total Revenue | $ | 153,255 | $ | 151,026 | $ | 57,684 | $ | 153,430 | $ | 133,346 | $ | 52,914 | $ | 701,655 | |||||||
Gross Margin | $ | 46,887 | $ | 35,865 | $ | 20,288 | $ | 54,886 | $ | 32,685 | $ | 19,982 | $ | 210,593 | |||||||
Six fiscal months ended July 2, 2011: | |||||||||||||||||||||
Product Sales | $ | 296,081 | $ | 329,030 | $ | 121,467 | $ | 339,349 | $ | 316,147 | $ | - | $ | 1,402,074 | |||||||
Royalty Revenues | 162 | - | 42 | 2,711 | - | - | $ | 2,915 | |||||||||||||
Total Revenue | $ | 296,243 | $ | 329,030 | $ | 121,509 | $ | 342,060 | $ | 316,147 | $ | - | $ | 1,404,989 | |||||||
Gross Margin | $ | 82,250 | $ | 82,839 | $ | 41,909 | $ | 120,114 | $ | 99,741 | $ | - | $ | 426,853 | |||||||
Six fiscal months ended July 3, 2010: | |||||||||||||||||||||
Product Sales | $ | 280,831 | $ | 291,272 | $ | 116,053 | $ | 299,398 | $ | 250,677 | $ | 101,089 | $ | 1,339,320 | |||||||
Royalty Revenues | 48 | - | 60 | 2,687 | - | - | $ | 2,795 | |||||||||||||
Total Revenue | $ | 280,879 | $ | 291,272 | $ | 116,113 | $ | 302,085 | $ | 250,677 | $ | 101,089 | $ | 1,342,115 | |||||||
Gross Margin | $ | 73,905 | $ | 63,511 | $ | 39,944 | $ | 106,806 | $ | 56,410 | $ | 37,030 | $ | 377,606 |
Fiscal quarters ended | Six fiscal months ended | |||||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||||
Operating margin reconciliation: | ||||||||||||||||
MOSFETs | $ | 32,522 | $ | 37,864 | $ | 61,932 | $ | 56,154 | ||||||||
Diodes | 37,208 | 30,121 | 70,008 | 51,956 | ||||||||||||
Optoelectronic Components | 18,330 | 17,454 | 34,687 | 34,115 | ||||||||||||
Resistors & Inductors | 51,757 | 48,497 | 105,861 | 93,737 | ||||||||||||
Capacitors | 38,584 | 27,111 | 86,917 | 44,873 | ||||||||||||
Vishay Precision Group | - | 10,871 | - | 18,949 | ||||||||||||
Unallocated Selling, General, and Administrative Expenses | (59,007 | ) | (70,591 | ) | (117,813 | ) | (133,332 | ) | ||||||||
Executive Compensation Charge | (3,889 | ) | - | (3,889 | ) | - | ||||||||||
Consolidated Operating Income | $ | 115,505 | $ | 101,327 | $ | 237,703 | $ | 166,452 | ||||||||
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Numerator: | ||||||||||||
Numerator for basic earnings per share: | ||||||||||||
Net earnings | $ | 82,095 | $ | 76,659 | $ | 157,382 | $ | 122,079 | ||||
Adjustment to the numerator for continuing | ||||||||||||
operations and net earnings: | ||||||||||||
Interest savings assuming conversion of dilutive
|
||||||||||||
convertible and exchangeable notes, net of tax
|
48 | 50 | 94 | 92 | ||||||||
Numerator for diluted earnings per share: | ||||||||||||
Net earnings | $ | 82,143 | $ | 76,709 | $ | 157,476 | $ | 122,171 | ||||
Denominator: | ||||||||||||
Denominator for basic earnings per share: | ||||||||||||
Weighted average shares | 160,801 | 186,667 | 163,006 | 186,654 | ||||||||
Effect of dilutive securities: | ||||||||||||
Convertible and exchangeable debt instruments | 9,166 | 6,176 | 9,464 | 6,176 | ||||||||
Employee stock options | 162 | 7 | 201 | 6 | ||||||||
Other | 516 | 234 | 472 | 240 | ||||||||
Dilutive potential common shares | 9,844 | 6,417 | 10,137 | 6,422 | ||||||||
Denominator for diluted earnings per share: | ||||||||||||
Adjusted weighted average shares | 170,645 | 193,084 | 173,143 | 193,076 | ||||||||
Basic earnings per share attributable to Vishay stockholders | $ | 0.51 | $ | 0.41 | $ | 0.97 | $ | 0.65 | ||||
Diluted earnings per share attributable to Vishay stockholders | $ | 0.48 | $ | 0.40 | $ | 0.91 | $ | 0.63 |
Fiscal quarters ended | Six fiscal months ended | |||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||
Convertible and exchangeable notes: | ||||||||
Convertible Senior Debentures, due 2041 | 4,332 | - | 2,166 | - | ||||
Convertible Subordinated Notes, due 2023 | - | 87 | - | 87 | ||||
Weighted average employee stock options | - | 2,514 | 2 | 2,595 | ||||
Weighted average warrants | 8,824 | 8,824 | 8,824 | 8,824 | ||||
Weighted average other | 101 | 9 | 69 | 47 |
Total | ||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||
July 2, 2011: | ||||||||||||||
Assets: | ||||||||||||||
Assets held in rabbi trusts | $ | 28,974 | $ | 17,242 | $ | 11,732 | $ | - | ||||||
Available for sale securities | $ | 6,212 | 6,212 | - | - | |||||||||
$ | 35,186 | $ | 23,454 | $ | 11,732 | $ | - | |||||||
Liabilities: | ||||||||||||||
Embedded derivative - convertible debentures due 2040 | $ | (327 | ) | $ | - | $ | - | $ | (327 | ) | ||||
Embedded derivative - convertible debentures due 2041 | $ | (213 | ) | - | - | (213 | ) | |||||||
$ | (540 | ) | $ | - | $ | - | $ | (540 | ) | |||||
December 31, 2010: | ||||||||||||||
Assets: | ||||||||||||||
Assets held in rabbi trusts | $ | 25,585 | $ | 15,575 | $ | 10,010 | $ | - | ||||||
Available for sale securities | $ | 5,736 | 5,736 | - | - | |||||||||
$ | 31,321 | $ | 21,311 | $ | 10,010 | $ | - | |||||||
Liability: | ||||||||||||||
Embedded derivative - convertible debentures due 2040 | $ | (319 | ) | - | - | (319 | ) |
Fiscal quarters ended | Six fiscal months ended | ||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | ||||||||||
GAAP net earnings attributable to Vishay stockholders | $ | 82,095 | $ | 76,659 | $ | 157,382 | $ | 122,079 | |||||
Reconciling items affecting operating margin: | |||||||||||||
Executive compensation charge | $ | 3,889 | $ | - | $ | 3,889 | $ | - | |||||
Reconciling items affecting tax expense: | |||||||||||||
Tax effects of items above and other one-time tax expense (benefit) | $ | (1,419 | ) | $ | - | $ | 8,605 | $ | - | ||||
Adjusted net earnings | $ | 84,565 | $ | 76,659 | $ | 169,876 | $ | 122,079 | |||||
Adjusted weighted average diluted shares outstanding | 170,645 | 193,084 | 173,143 | 193,076 | |||||||||
Adjusted earnings per diluted share * | $ | 0.50 | $ | 0.40 | $ | 0.98 | $ | 0.63 | |||||
____________________ |
2nd Quarter | 3rd Quarter | 4th Quarter | 1st Quarter | 2nd Quarter | ||||||||||||||||
2010 | 2010 | 2010 | 2011 | 2011 | ||||||||||||||||
Net revenues (1) | $ | 701,655 | $ | 694,365 | $ | 688,612 | $ | 695,151 | $ | 709,838 | ||||||||||
Gross profit margin | 30.0 | % | 31.5 | % | 30.7 | % | 30.9 | % | 29.9 | % | ||||||||||
Operating margin | 14.4 | % | 18.9 | % | 17.5 | % | 17.6 | % | 16.3 | % | ||||||||||
End-of-period backlog (2) | $ | 987,900 | $ | 1,009,900 | $ | 880,700 | $ | 911,600 | $ | 881,800 | ||||||||||
Book-to-bill ratio | 1.15 | 1.04 | 0.83 | 1.01 | 0.95 | |||||||||||||||
Inventory turnover | 4.35 | 4.55 | 4.43 | 4.35 | 4.23 | |||||||||||||||
Change in ASP vs. prior quarter | 1.9 | % | 2.0 | % | 1.3 | % | -0.2 | % | -0.4 | % | ||||||||||
____________________ |
2nd Quarter | 3rd Quarter | 4th Quarter | 1st Quarter | 2nd Quarter | ||||||||||||||||
2010 | 2010 | 2010 | 2011 | 2011 | ||||||||||||||||
MOSFETs | ||||||||||||||||||||
Net revenues | $ | 153,255 | $ | 181,965 | $ | 163,854 | $ | 142,998 | $ | 153,245 | ||||||||||
Book-to-bill ratio | 0.75 | 1.17 | 0.70 | 1.07 | 0.95 | |||||||||||||||
Gross profit margin | 30.6 | % | 34.5 | % | 32.0 | % | 27.6 | % | 27.9 | % | ||||||||||
Segment operating margin | 24.7 | % | 29.6 | % | 26.1 | % | 20.6 | % | 21.2 | % | ||||||||||
Diodes | ||||||||||||||||||||
Net revenues | $ | 151,026 | $ | 157,193 | $ | 147,889 | $ | 159,417 | $ | 169,613 | ||||||||||
Book-to-bill ratio | 1.35 | 0.91 | 0.88 | 1.00 | 0.97 | |||||||||||||||
Gross profit margin | 23.7 | % | 25.5 | % | 23.5 | % | 24.6 | % | 25.8 | % | ||||||||||
Segment operating margin | 19.9 | % | 21.9 | % | 19.5 | % | 20.6 | % | 21.9 | % | ||||||||||
Optoelectronic Components | ||||||||||||||||||||
Net revenues | $ | 57,684 | $ | 56,836 | $ | 53,549 | $ | 57,748 | $ | 63,761 | ||||||||||
Book-to-bill ratio | 1.26 | 0.86 | 0.99 | 1.13 | 0.86 | |||||||||||||||
Gross profit margin | 35.2 | % | 33.9 | % | 31.0 | % | 34.5 | % | 34.4 | % | ||||||||||
Segment operating margin | 30.3 | % | 29.1 | % | 25.1 | % | 28.3 | % | 28.7 | % | ||||||||||
Resistors & Inductors | ||||||||||||||||||||
Net revenues | $ | 153,430 | $ | 158,455 | $ | 167,764 | $ | 173,136 | $ | 168,924 | ||||||||||
Book-to-bill ratio | 1.22 | 1.01 | 0.84 | 0.94 | 0.99 | |||||||||||||||
Gross profit margin | 36.0 | % | 35.3 | % | 35.8 | % | 35.3 | % | 34.9 | % | ||||||||||
Segment operating margin | 31.6 | % | 30.7 | % | 31.8 | % | 31.2 | % | 30.6 | % | ||||||||||
Capacitors | ||||||||||||||||||||
Net revenues | $ | 133,346 | $ | 139,916 | $ | 155,556 | $ | 161,852 | $ | 154,295 | ||||||||||
Book-to-bill ratio | 1.31 | 1.11 | 0.85 | 1.00 | 0.89 | |||||||||||||||
Gross profit margin | 24.4 | % | 28.9 | % | 30.6 | % | 34.0 | % | 29.0 | % | ||||||||||
Segment operating margin | 20.3 | % | 25.3 | % | 26.6 | % | 29.9 | % | 25.0 | % | ||||||||||
Vishay Precision Group | ||||||||||||||||||||
Net revenues | $ | 52,914 | n/a | n/a | n/a | n/a | ||||||||||||||
Book-to-bill ratio | 1.06 | n/a | n/a | n/a | n/a | |||||||||||||||
Gross profit margin | 37.8 | % | n/a | n/a | n/a | n/a | ||||||||||||||
Segment operating margin | 20.5 | % | n/a | n/a | n/a | n/a |
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Cost of products sold | 70.1 | % | 70.0 | % | 69.6 | % | 71.9 | % | ||||
Gross profit | 29.9 | % | 30.0 | % | 30.4 | % | 28.1 | % | ||||
Selling, general & administrative expenses | 13.1 | % | 15.6 | % | 13.2 | % | 15.7 | % | ||||
Operating income | 16.3 | % | 14.4 | % | 16.9 | % | 12.4 | % | ||||
Income before taxes and noncontrolling interest | 15.6 | % | 14.9 | % | 16.3 | % | 12.5 | % | ||||
Net earnings attributable to Vishay stockholders | 11.6 | % | 10.9 | % | 11.2 | % | 9.1 | % | ||||
__________ | ||||||||||||
Effective tax rate | 25.6 | % | 26.6 | % | 30.8 | % | 26.9 | % |
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Net revenues | $ | 709,838 | $ | 701,655 | $ | 1,404,989 | $ | 1,342,115 | ||||||
Change versus comparable prior year period | $ | 8,183 | $ | 62,874 | ||||||||||
Percentage change versus | ||||||||||||||
comparable prior year period | 1.2 | % | 4.7 | % |
vs. Prior Year | vs. Prior | |||||
Quarter | Year-to-Date | |||||
Change attributable to: | ||||||
Increase in volume | 2.1 | % | 6.3 | % | ||
Increase in average selling prices | 3.1 | % | 4.1 | % | ||
Absence of VPG | -7.5 | % | -7.5 | % | ||
Foreign currency effects | 3.9 | % | 1.8 | % | ||
Other | -0.4 | % | 0.0 | % | ||
Net change | 1.2 | % | 4.7 | % | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Net revenues | $ | 153,245 | $ | 153,255 | $ | 296,243 | $ | 280,879 | ||||||
Change versus comparable prior year period | $ | (10 | ) | $ | 15,364 | |||||||||
Percentage change versus | ||||||||||||||
comparable prior year period | 0.0 | % | 5.5 | % |
vs. Prior Year | vs. Prior | |||||
Quarter | Year-to-Date | |||||
Change attributable to: | ||||||
Increase in volume | 0.0 | % | 3.3 | % | ||
Change in average selling prices | -1.4 | % | 1.3 | % | ||
Foreign currency effects | 1.4 | % | 0.7 | % | ||
Other | 0.0 | % | 0.2 | % | ||
Net change | 0.0 | % | 5.5 | % | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Gross profit margin | 27.9 | % | 30.6 | % | 27.8 | % | 26.3 | % |
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Net revenues | $ | 169,613 | $ | 151,026 | $ | 329,030 | $ | 291,272 | ||||||
Change versus comparable prior year period | $ | 18,587 | $ | 37,758 | ||||||||||
Percentage change versus | ||||||||||||||
comparable prior year period | 12.3 | % | 13.0 | % |
vs. Prior Year | vs. Prior | |||||
Quarter | Year-to-Date | |||||
Change attributable to: | ||||||
Increase in volume | 4.5 | % | 6.1 | % | ||
Increase in average selling prices | 3.3 | % | 4.2 | % | ||
Foreign currency effects | 3.9 | % | 1.9 | % | ||
Other | 0.6 | % | 0.8 | % | ||
Net change | 12.3 | % | 13.0 | % | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Gross profit margin | 25.8 | % | 23.7 | % | 25.2 | % | 21.8 | % |
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Net revenues | $ | 63,761 | $ | 57,684 | $ | 121,509 | $ | 116,113 | ||||||
Change versus comparable prior year period | $ | 6,077 | $ | 5,396 | ||||||||||
Percentage change versus | ||||||||||||||
comparable prior year period | 10.5 | % | 4.6 | % |
vs. Prior Year | vs. Prior | |||||
Quarter | Year-to-Date | |||||
Change attributable to: | ||||||
Increase in volume | 6.2 | % | 2.7 | % | ||
Decrease in average selling prices | -0.8 | % | -0.3 | % | ||
Foreign currency effects | 5.0 | % | 2.2 | % | ||
Other | 0.1 | % | 0.0 | % | ||
Net change | 10.5 | % | 4.6 | % | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Gross profit margin | 34.4 | % | 35.2 | % | 34.5 | % | 34.4 | % |
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Net revenues | $ | 168,924 | $ | 153,430 | $ | 342,060 | $ | 302,085 | ||||||
Change versus comparable prior year period | $ | 15,494 | $ | 39,975 | ||||||||||
Percentage change versus | ||||||||||||||
comparable prior year period | 10.1 | % | 13.2 | % |
vs. Prior Year | vs. Prior | |||||
Quarter | Year-to-Date | |||||
Change attributable to: | ||||||
Increase in volume | 3.2 | % | 9.3 | % | ||
Increase in average selling prices | 0.4 | % | 0.4 | % | ||
Foreign currency effects | 5.9 | % | 2.7 | % | ||
Other | 0.6 | % | 0.8 | % | ||
Net change | 10.1 | % | 13.2 | % | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Gross profit margin | 34.9 | % | 36.0 | % | 35.1 | % | 35.5 | % |
Fiscal quarters ended | Six fiscal months ended | |||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||||
Net revenues | $ | 154,295 | $ | 133,346 | $ | 316,147 | $ | 250,677 | ||||||
Change versus comparable prior year period | $ | 20,949 | $ | 65,470 | ||||||||||
Percentage change versus | ||||||||||||||
comparable prior year period | 15.7 | % | 26.1 | % |
vs. Prior Year | vs. Prior | |||||
Quarter | Year-to-Date | |||||
Change attributable to: | ||||||
Change in volume | -2.8 | % | 7.7 | % | ||
Increase in average selling prices | 13.1 | % | 13.2 | % | ||
Foreign currency effects | 5.3 | % | 2.4 | % | ||
Other | 0.1 | % | 2.8 | % | ||
Net change | 15.7 | % | 26.1 | % | ||
Fiscal quarters ended | Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | |||||||||
Gross profit margin | 29.0 | % | 24.4 | % | 31.5 | % | 22.4 | % |
Fiscal quarter ended | Six fiscal months ended | |||||||
July 3, 2010 | July 3, 2010 | |||||||
Net revenues | $ | 52,914 | $ | 101,089 | ||||
Gross profit margin | 37.8 | % | 36.6 | % |
Fiscal quarters ended | Six fiscal months ended | ||||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | ||||||||||||
Total SG&A expenses | $ | 92,796 | $ | 109,266 | $ | 185,261 | $ | 211,154 | |||||||
as a percentage of revenues | 13.1 | % | 15.6 | % | 13.2 | % | 15.7 | % |
Fiscal quarters ended | Six fiscal months ended | ||||||||||||||
July 2, 2011 | July 3, 2010 | July 2, 2011 | July 3, 2010 | ||||||||||||
Amortization of intangible assets | $ | 3,796 | $ | 5,201 | $ | 7,565 | $ | 10,730 | |||||||
Net (gain) loss on sales of assets | 29 | (24 | ) | (930 | ) | (92 | ) | ||||||||
Costs associated with the VPG spin-off | - | 6,000 | - | 8,100 |
Fiscal quarters ended | |||||||||||
July 2, 2011 | July 3, 2010 | Change | |||||||||
Foreign exchange gain (loss) | $ | (2,748 | ) | $ | 5,462 | $ | (8,210 | ) | |||
Interest income | 2,672 | 506 | 2,166 | ||||||||
Other | 48 | (12 | ) | 60 | |||||||
$ | (28 | ) | $ | 5,956 | $ | (5,984 | ) | ||||
Six fiscal months ended | |||||||||||
July 2, 2011 | July 3, 2010 | Change | |||||||||
Foreign exchange gain (loss) | $ | (4,613 | ) | $ | 4,987 | $ | (9,600 | ) | |||
Interest income | 4,148 | 1,178 | 2,970 | ||||||||
Other | (70 | ) | (165 | ) | 95 | ||||||
$ | (535 | ) | $ | 6,000 | $ | (6,535 | ) | ||||
July 2, | December 31, | ||||
2011 | 2010 | ||||
Credit facility | $ | 180,000 | $ | 240,000 | |
Exchangeable unsecured notes, due 2102 | 95,042 | 95,042 | |||
Convertible senior debentures, due 2040* | 97,407 | 96,640 | |||
Convertible senior debentures, due 2041* | 49,973 | - | |||
Total debt | 422,422 | 431,682 | |||
Cash and cash equivalents | 692,592 | 897,338 | |||
Short-term investments | 314,408 | - | |||
Net cash and short-term investments (debt) | $ | 584,578 | $ | 465,656 | |
____________________ |
Payments due by period | |||||||||||||||
2012 - | 2014 - | 2016 and | |||||||||||||
Total | 2011 | 2013 | 2015 | beyond | |||||||||||
Long-term debt (1) | $ | 700,042 | $ | - | $ | - | $ | 180,000 | $ | 520,042 | |||||
Interest payments on long-term debt (2) | 335,243 | 13,576 | 29,578 | 29,162 | 262,927 |
Payments due by period | |||||||||||||||
2012 - | 2014 - | 2016 and | |||||||||||||
Total | 2011 | 2013 | 2015 | beyond | |||||||||||
Long-term debt (1) | $ | 610,042 | $ | - | $ | - | $ | 240,000 | $ | 370,042 | |||||
Interest payments on long-term debt (2) | 243,402 | 12,737 | 25,474 | 25,474 | 179,717 |
Total Number of | Total Dollars | Maximum Dollar | |||||||||||
Total Number | Average | Shares Purchased as | Purchased | Value of Shares that | |||||||||
of Share | Price per | Part of Publicly | Under the | May Yet Be Purchased | |||||||||
Period | Purchased | Share | Announced Program | Program | Under the Program | ||||||||
April 3 - April 30 | - | $ | - | - | $ | - | $ | - | |||||
May 1 - May 28 | 8,620,689 | $ | 17.40 | 8,620,689 | $ | 150,000,000 | $ | - | |||||
May 29 - July 2 | - | $ | - | - | $ | - | $ | - |
3.2 | Amended and Restated Bylaws dated June 1, 2011. Incorporated by reference to Exhibit 3.2 to our current report on Form 8-K filed June 2, 2011. | |
4.1 | Indenture, dated as of May 13, 2011, by and between Vishay Intertechnology, Inc. and Wilmington Trust Company, as Trustee. Incorporated by reference to Exhibit 4.1 to our current report on Form 8-K filed May 13, 2011. | |
31.1 | Certification pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Dr. Gerald Paul, Chief Executive Officer. | |
31.2 | Certification pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Dr. Lior E. Yahalomi, Chief Financial Officer. | |
32.1 | Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Dr. Gerald Paul, Chief Executive Officer. | |
32.2 | Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Dr. Lior E. Yahalomi, Chief Financial Officer. | |
101 | Interactive Data File (Quarterly Report on Form 10-Q, for the quarterly period ended July 2, 2011, furnished in XBRL (eXtensible Business Reporting Language)). |
VISHAY INTERTECHNOLOGY, INC. | |
/s/ Lior E. Yahalomi
|
|
Dr. Lior E. Yahalomi
Executive Vice President and Chief Financial Officer (as a duly authorized officer and principal financial officer) |
|
/s/ Lori Lipcaman
|
|
Lori Lipcaman
Executive Vice President and Chief Accounting Officer (as a duly authorized officer and principal accounting officer) |
1. | I have reviewed this quarterly report on Form 10-Q of Vishay Intertechnology, Inc.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | ||
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | ||
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. | ||
1. | I have reviewed this quarterly report on Form 10-Q of Vishay Intertechnology, Inc.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | ||
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | ||
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. | ||
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Fair Value Measurements (Details) (USD $)
In Thousands |
Jul. 02, 2011
|
Dec. 31, 2010
|
---|---|---|
Assets held in rabbi trusts | $ 28,974 | $ 25,585 |
Available for sale securities | 6,212 | 5,736 |
Fair Value Assets | 35,168 | 31,321 |
Liabilities: | ||
Embedded derivative | (540) | (319) |
Convertible Senior Debentures Due In 2041 | Fair Value, Inputs, Level 1 [Member]
|
||
Liabilities: | ||
Embedded derivative | 0 | |
Convertible Senior Debentures Due In 2041 | Fair Value, Inputs, Level 2 [Member]
|
||
Liabilities: | ||
Embedded derivative | 0 | |
Convertible Senior Debentures Due In 2041 | Fair Value, Inputs, Level 3 [Member]
|
||
Liabilities: | ||
Embedded derivative | (213) | |
Convertible Senior Debentures [Member] | Fair Value, Inputs, Level 1 [Member]
|
||
Liabilities: | ||
Embedded derivative | 0 | 0 |
Convertible Senior Debentures [Member] | Fair Value, Inputs, Level 2 [Member]
|
||
Liabilities: | ||
Embedded derivative | 0 | 0 |
Convertible Senior Debentures [Member] | Fair Value, Inputs, Level 3 [Member]
|
||
Liabilities: | ||
Embedded derivative | (327) | (319) |
Fair Value, Inputs, Level 1 [Member]
|
||
Assets held in rabbi trusts | 17,242 | 15,575 |
Available for sale securities | 6,212 | 5,736 |
Fair Value Assets | 23,454 | 21,311 |
Liabilities: | ||
Embedded derivative | 0 | 0 |
Fair Value, Inputs, Level 2 [Member]
|
||
Assets held in rabbi trusts | 11,732 | 10,010 |
Available for sale securities | 0 | 0 |
Fair Value Assets | 11,732 | 10,010 |
Liabilities: | ||
Embedded derivative | 0 | 0 |
Fair Value, Inputs, Level 3 [Member]
|
||
Assets held in rabbi trusts | 0 | 0 |
Available for sale securities | 0 | 0 |
Fair Value Assets | 0 | 0 |
Liabilities: | ||
Embedded derivative | $ (540) | $ (319) |
Consolidated Condensed Statements of Operations (USD $)
In Thousands, except Per Share data |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2011
|
Jul. 03, 2010
|
Jul. 02, 2011
|
Jul. 03, 2010
|
|
Net revenues | $ 709,838 | $ 701,655 | $ 1,404,989 | $ 1,342,115 |
Costs of products sold | 497,648 | 491,062 | 978,136 | 964,509 |
Gross profit | 212,190 | 210,593 | 426,853 | 377,606 |
Selling, general, and administrative expenses | 92,796 | 109,266 | 185,261 | 211,154 |
Executive compensation charge | 3,889 | 0 | 3,889 | 0 |
Operating Income | 115,505 | 101,327 | 237,703 | 166,452 |
Other income (expense): | ||||
Interest expense | (4,624) | (2,400) | (8,678) | (4,834) |
Other | (28) | 5,956 | (535) | 6,000 |
Nonoperating Income (Expense), Total | (4,652) | 3,556 | (9,213) | 1,166 |
Income before taxes | 110,853 | 104,883 | 228,490 | 167,618 |
Income taxes | 28,357 | 27,918 | 70,387 | 45,014 |
Net earnings | 82,496 | 76,965 | 158,103 | 122,604 |
Less: net earnings attributable to noncontrolling interests | 401 | 306 | 721 | 525 |
Net earnings attributable to Vishay stockholders | $ 82,095 | $ 76,659 | $ 157,382 | $ 122,079 |
Basic earnings per share attributable to Vishay stockholders (in dollars per share) | $ 0.51 | $ 0.41 | $ 0.97 | $ 0.65 |
Diluted earnings per share attributable to Vishay stockholders (in dollars per share) | $ 0.48 | $ 0.40 | $ 0.91 | $ 0.63 |
Weighted average shares outstanding - basic (in shares) | 160,801 | 186,667 | 163,006 | 186,654 |
Weighted average shares outstanding - diluted (in shares) | 170,645 | 193,084 | 173,143 | 193,076 |
Earnings Per Share (Tables)
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Jul. 02, 2011
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Earnings Per Share (Table) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Computation of basic and diluted earnings (loss) per share attributable to Vishay stockholders
|
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Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | Weighted average potential common shares that would have an antidilutive effect or have unsatisfied performance conditions
|
Document and Entity Informations
|
6 Months Ended | |
---|---|---|
Jul. 02, 2011
|
Jul. 29, 2011
|
|
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jul. 02, 2011 | |
Document Fiscal Year Focus | 2011 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | vsh | |
Entity Registrant Name | VISHAY INTERTECHNOLOGY INC | |
Entity Central Index Key | 0000103730 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 143,709,508 | |
Class B Convertible Common Stock
|
||
Entity Common Stock, Shares Outstanding | 13,452,549 |
Acquisition and Divestiture Activities (Details Textuals) (USD $)
In Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2010
|
Dec. 31, 2008
|
|
Exchange Ratio Under Spin-Off | 1 share of VPG common stock for every 14 shares of Vishay common stock
|
|
Term loan issued in connection with business acquisition | $ 15 | |
Common Class B [Member]
|
||
Exchange Ratio Under Spin-Off | 1 share of VPG Class B common stock for every 14 shares of Vishay Class B common stock
|
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Pensions and Other Postretirement Benefits
|
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Jul. 02, 2011
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Compensation and Retirement Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pensions and Other Postretirement Benefits | Note 6 – Pensions and Other Postretirement Benefits
The Company maintains various retirement benefit plans.
The following table shows the components of the net periodic pension cost for the second fiscal quarters of 2011 and 2010 for the Company’s defined benefit pension plans
(in thousands)
:
The following table shows the components of the net periodic pension cost for the six fiscal months ended July 2, 2011 and July 3, 2010 for the Company’s defined benefit pension plans (in thousands) :
The following table shows the components of the net periodic benefit cost for the second fiscal quarters of 2011 and 2010 for the Company’s other postretirement benefit plans
(in thousands)
:
The following table shows the components of the net periodic pension cost for the six fiscal months ended July 2, 2011 and July 3, 2010 for the Company’s other postretirement benefit plans
(in thousands)
:
|
Income Taxes (Details Textuals) (USD $)
In Millions |
6 Months Ended | 12 Months Ended |
---|---|---|
Jul. 02, 2011
|
Dec. 31, 2010
|
|
Company's Deferred Tax Assets In Israel | $ 10 | |
Increase In Liabilities For Unrecongnized Tax Benefits | $ 4.7 | |
Effective Income Tax Rate Description | The provision for income taxes consists of provisions for federal, state, and foreign income taxes. The effective tax rates for the periods ended July 2, 2011 and July 3, 2010 reflect the Company’s expected tax rate on reported income from continuing operations before income tax and tax adjustments. The Company operates in a global environment with significant operations in various locations outside the United States. Accordingly, the consolidated income tax rate is a composite rate reflecting the Company’s earnings and the applicable tax rates in the various locations where the Company operates.
|
Stock-Based Compensation (Details 1) (USD $)
In Thousands, unless otherwise specified |
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Cost | $ 6,456 |
Stock Options [Member]
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Cost | 208 |
Weighted Average Remaining Amortization Periods | 1.6 |
Restricted Stock Units (RSUs) [Member]
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Cost | 6,248 |
Weighted Average Remaining Amortization Periods | 1.9 |
Phantom Stock Units [Member]
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Cost | $ 0 |
Weighted Average Remaining Amortization Periods | 0 |
Basis of Presentation (Details Textuals)
|
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncement or Change in Accounting Principle, Description | In January 2010, the Financial Accounting Standards Board (FASB) updated the accounting guidance related to fair value measurements disclosures. The updated guidance (i) requires separate disclosure of significant transfers in and out of Levels 1 and 2 fair value measurements, (ii) requires disclosure of Level 3 fair value measurements activity on a gross basis, (iii) clarifies existing disaggregation requirements, (iv) and clarifies existing input and valuation technique disclosure requirements. The updated guidance was effective for the Company for interim and annual periods beginning after January 1, 2010, except for the Level 3 fair value measurement disclosure requirements, which are effective for fiscal years beginning after January 1, 2011. Vishay adopted the then-effective aspects of the guidance on January 1, 2010 and adopted the remaining guidance on January 1, 2011. The adoption of the guidance had no effect on the Company's financial position, results of operations, or liquidity. In May 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-4, Fair Value Measurement (Topic 820), Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in GAAP and IFRS. The ASU generally aligns the principles for fair value measurements and the related disclosure requirements under GAAP and IFRS. The updated guidance clarifies existing fair value measurement and disclosure requirements and requires additional disclosure requirements. The ASU is effective for the Company for interim and annual periods beginning after January 1, 2012. The adoption of the ASU is not expected to have any effect on the Company's financial position, results of operations, or liquidity. In June 2011, the FASB issued ASU No. 2011-5, Comprehensive Income (Topic 220), Presentation of Comprehensive Income. The ASU requires that all non-owner changes in stockholders' equity be presented either in a single continuous statement of comprehensive income or in two separate, but consecutive statements. The ASU is effective for the Company for interim and annual periods beginning after January 1, 2012. The adoption of the ASU is not expected to have any effect on the Company's financial position, results of operations, or liquidity. |
Fiscal Period, Policy [Policy Text Block] | The Company reports interim financial information for 13-week periods beginning on a Sunday and ending on a Saturday, except for the first fiscal quarter, which always begins on January 1, and the fourth fiscal quarter, which always ends on December 31. The four fiscal quarters in 2011 end on April 2, 2011, July 2, 2011, October 1, 2011, and December 31, 2011. The four fiscal quarters in 2010 ended on April 3, 2010, July 3, 2010, October 2, 2010, and December 31, 2010, respectively. |
Commitments and Contingencies
|
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11 – Commitments and Contingencies
Executive Employment Agreements
The Company has employment agreements with certain of its senior executives. Pursuant to Dr. Zandman’s amended and restated employment agreement entered into on May 13, 2009 (as amended, the “2009 Agreement”), his estate is entitled to receive annual payments of $10 million through 2014. Dr. Zandman’s passing has no effect on the timing of these payments. The compensation expense for these payments was recorded upon entering into the 2009 Agreement and is not affected by Dr. Zandman’s passing. The purpose of the 2009 Agreement was to eliminate the right of Dr. Zandman to receive a royalty during the ten years following his termination of employment equal to 5% of gross sales, less returns and allowances, of Vishay products incorporating inventions and any other form of technology created, discovered or developed by him or under his direction.
The Company recognized compensation expense of $3,889,000 reported on a separate line in the accompanying consolidated condensed statement of operations in the second fiscal quarter of 2011 for other elements of compensation that accelerated upon the passing of Dr. Zandman. (See also Note 7.)
|
Acquisition and Divestiture Activities
|
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Business Combinations [Abstract] | |
Acquisition and Divestiture Activities | Note 2 – Acquisition and Divestiture Activities As part of its growth strategy, the Company seeks to expand through targeted acquisitions of other manufacturers of electronic components that have established positions in major markets, reputations for product quality and reliability, and product lines with which the Company has substantial marketing and technical expertise. Spin-off of Vishay Precision Group, Inc. On October 27, 2009, Vishay announced that it intended to spin off its measurements and foil resistors businesses into an independent, publicly-traded company to be named Vishay Precision Group, Inc. On June 15, 2010, the Board of Directors of Vishay approved the spin-off of VPG and on July 6, 2010, Vishay completed the spin-off through a tax-free stock dividend to Vishay’s stockholders. Vishay’s common stockholders received 1 share of VPG common stock for every 14 shares of Vishay common stock they held on the record date, June 25, 2010, and Vishay’s Class B common stockholders received 1 share of VPG Class B common stock for every 14 shares of Vishay Class B common stock they held on the record date. Until July 6, 2010, VPG was part of Vishay and its results of operations and cash flows are included in the amounts reported in these consolidated condensed financial statements for periods prior to the completion of the spin-off. The product lines that comprise VPG are included in the VPG reporting segment. See Note 8 for further information on the effect that VPG had on Vishay’s consolidated results. Relationship with VPG after Spin-off
Following the spin-off, VPG is an independent company and Vishay retains no ownership interest. However, two members of the VPG board of directors also serve on Vishay’s board of directors. In connection with the completion of the spin-off, on July 6, 2010, Vishay and its subsidiaries entered into several agreements with VPG and its subsidiaries that govern the relationship of the parties following the spin-off. Among the agreements entered into with VPG and its subsidiaries were a transition services agreement, several lease agreements, and supply agreements. None of the agreements are expected to have a material impact on Vishay’s financial position, results of operations, or liquidity. Vishay also entered into a trademark license agreement with VPG pursuant to which Vishay granted VPG the license to use certain trademarks, service marks, logos, trade names, entity names, and domain names which include the term “Vishay.” The license granted VPG the limited, exclusive, royalty-free right and license to use certain marks and names incorporating the term “Vishay” in connection with the design, development, manufacture, marketing, provision and performance of certain VPG products that do not compete with any products within Vishay’s product range as constituted immediately following the separation and certain services provided in connection with the products. The license cannot be terminated except as a result of willful misconduct or liquidation bankruptcy of VPG. As a result of this continuing involvement, Vishay did not restate prior periods to present VPG as a discontinued operation. Prepayment of KEMET Loan Receivable In conjunction with the acquisition of the wet tantalum capacitor business of KEMET Corporation (“KEMET”) on September 15, 2008, Vishay issued a three-year term loan of $15 million to KEMET. On May 5, 2010, KEMET prepaid the entire principal amount of the term loan plus interest.
|
Pensions and Other Postretirement Benefits (Details) (USD $)
In Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2011
|
Jul. 03, 2010
|
Jul. 02, 2011
|
Jul. 03, 2010
|
|
U.S. Plans
|
||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Net service cost | $ 0 | $ 0 | $ 0 | $ 0 |
Interest cost | 4,081 | 3,992 | 8,149 | 8,057 |
Expected return on plan assets | (4,888) | (4,648) | (9,541) | (9,049) |
Amortization of prior service cost | 612 | 158 | 1,253 | 202 |
Amortization of losses | 2,201 | 2,352 | 4,303 | 4,657 |
Curtailments and settlements | 148 | 0 | 148 | 0 |
Net periodic benefit cost | 2,154 | 1,854 | 4,312 | 3,867 |
Non-U.S. Plans
|
||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Net service cost | 849 | 757 | 1,676 | 1,534 |
Interest cost | 2,679 | 2,686 | 5,241 | 5,563 |
Expected return on plan assets | (398) | (457) | (789) | (923) |
Amortization of prior service cost | 0 | 0 | 0 | 0 |
Amortization of losses | 254 | 45 | 503 | 87 |
Curtailments and settlements | 0 | 0 | 0 | 0 |
Net periodic benefit cost | $ 3,384 | $ 3,031 | $ 6,631 | $ 6,261 |
Segment Information
|
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jul. 02, 2011
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Note 8 – Segment Information
In preparation for the spin-off of VPG, which was completed on July 6, 2010, the Company realigned its reportable business segments structure in the second fiscal quarter of 2010 to be consistent with changes made to its management reporting. The changes made to management reporting included separating the former Semiconductors reporting segment into MOSFETs, Diodes, and Optoelectronic Components and separating the former Passive Components reporting segment into Resistors And Inductors, Capacitors, and Vishay Precision Group. The changes were necessary due to the former Passive Components segment no longer being comparable after the completion of the spin-off of VPG, the need for discrete information regarding VPG, and the increased interest of management and outside investors in more discrete financial information. Effective beginning in the second fiscal quarter of 2010, the chief operating decision maker began making strategic and operating decisions with regards to assessing performance and allocating resources based on this new segment structure. Following the completion of the spin-off in the third fiscal quarter of 2010, the Company has five reporting segments.
The Company evaluates business segment performance on operating income, exclusive of certain items (“segment operating income”). Beginning in the second fiscal quarter of 2010, the Company changed its definition of segment operating income to exclude such costs as global operations, sales and marketing, information systems, finance and administration groups. These costs are managed by executives that report to the chief operating decision maker and were formerly included in segment operating income. Only dedicated, direct selling, general, and administrative expenses of the segments are included in the calculation of segment operating income. Additionally, management has always evaluated segment performance excluding items such as restructuring and severance costs, asset write-downs, goodwill and indefinite-lived intangible asset impairments, inventory write-downs, gains or losses on purchase commitments, and other items. Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to intrinsic operating results of the Company. These items represent reconciling items between segment operating income and consolidated operating income. Business segment assets are the owned or allocated assets used by each business.
Until July 6, 2010, VPG was part of Vishay and its results of operations and cash flows are included in the amounts reported in these consolidated condensed financial statements for the six fiscal months ended July 3, 2010. Excluding the non-recurring costs of the spin-off incurred by Vishay, VPG contributed $9,716,000 of income before taxes, $5,811,000 of net earnings attributable to Vishay stockholders, and $0.03 per diluted share attributable to Vishay stockholders to Vishay’s results for the six fiscal months ended July 3, 2010.
The
following
table sets forth
business
segment
information
(in
thousands)
:
|
Comprehensive Income (Loss) (Tables)
|
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Jul. 02, 2011
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Comprehensive Income (Loss) (Tables) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Comprehensive Income (Loss) | Components of Comprehensive income (loss)
|
Earnings Per Share
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jul. 02, 2011
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Note 9 – Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share attributable to Vishay stockholders
(in thousands, except per share amounts)
:
Diluted earnings per share for the periods presented do not reflect the following weighted average potential common shares that would have an antidilutive effect or have unsatisfied performance conditions
(in thousands)
:
In periods in which they are dilutive, if the potential common shares related to the exchangeable notes are included in the computation, the related interest savings, net of tax, assuming conversion/exchange is added to the net earnings used to compute earnings per share.
The Company’s convertible debt instruments are only convertible upon the occurrence of certain events. While none of these events has occurred as of July 2, 2011, certain conditions which could trigger conversion have been deemed to be non-substantive, and accordingly, the Company has always assumed the conversion of these instruments in its diluted earnings per share computation during periods in which they are dilutive.
At the direction of its Board of Directors, the Company intends, upon conversion, to repay the principal amounts of the convertible senior debentures, due 2040 and due 2041, in cash and settle any additional amounts in shares of Vishay common stock. Accordingly, the debentures are included in the diluted earnings per share computation using the “treasury stock method” (similar to options and warrants) rather than the “if converted method” otherwise required for convertible debt. Under the “treasury stock method,” Vishay calculates the number of shares issuable under the terms of the notes based on the average market price of Vishay common stock during the period, and that number is included in the total diluted shares figure for the period. If the average market price is less than $13.88, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2040, and if the average market price is less than $19.02, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2041.
The Company purchased 99.6% of the outstanding convertible subordinated notes due 2023 pursuant to the option of the holders to require the Company to repurchase their notes on August 1, 2008. The remaining notes, with an aggregate principal amount of $1,870,000, were redeemed at Vishay’s option on August 1, 2010.
The Company waived its rights to settle the principal amount of the convertible subordinated notes, due 2023, in shares of Vishay common stock. Accordingly, the notes were included in the diluted earnings per share computation using the “treasury stock method” (similar to options and warrants) rather than the “if converted method” otherwise required for convertible debt. If the average market price was less than $21.28, no shares were included in the diluted earnings per share computation. The convertible subordinated notes were anti-dilutive for the fiscal quarter ended July 3, 2010 and therefore are not included in the computation of diluted earnings per share.
|
Long-Term Debt (Details Textuals) (USD $)
|
6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2011
|
Jul. 02, 2011
Convertible Senior Debentures 2041
|
Dec. 31, 2010
Convertible Senior Debentures 2040
|
Jul. 02, 2011
Convertible Senior Debentures 2040
|
|
Debt Instrument [Line Items] | ||||
Convertible senior debentures issuance date | 13-May-11 | 9-Nov-10 | ||
Proceeds from issuance of covertible senior debentures | $ 150,000,000 | $ 275,000,000 | ||
Stated rate of interest on convertible senior debentures | 2.25% | 2.25% | ||
Convertible senior debentures, Maturity date | 2041 | 2040 | ||
Effective rate of interest on convertible senior debentures | 8.375% | 8.00% | ||
Circumstances of Debenture 2041 conversion | Prior to February 15, 2041, the holders may only convert their debentures under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ending October 1, 2011 if the sale price of Vishay common stock reaches 130% of the conversion price ($24.73) for a specified period; (2) the trading price of the debentures falls below 98% of the product of the sale price of Vishay’s common stock and the conversion rate for a specified period; (3) Vishay calls any or all of the debentures for redemption, at any time prior to the close of business on the third scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. None of these conditions had occurred as of July 2, 2011.
|
|||
Treasury Stock, Value, Acquired, Cost Method | 150,000,000 | |||
Debt Instrument Percentage Of Conversion Price | 130.00% | |||
Debt Instrument, Conversion Price Amount | 24.73 | |||
Debt Instrument, Percentage of sale price of common stock | 98.00% | |||
Debt Instrument, Initial conversion shares of common stock | 52.5659 | |||
Debt Instrument, Principal Amount of Debentures | $ 1,000 | |||
Debt Instrument, Initial conversion price, per share | $ 19.02 | |||
Debt Instrument, Percentage of initial conversion price premium | 12.50% | |||
Debt Instrument, conversion price, per share | $ 16.90 | |||
Stock repurchase, (in shares) | 8,620,689 |
Stock-Based Compensation
|
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jul. 02, 2011
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Note 7 – Stock-Based Compensation
The Company has various stockholder-approved programs which allow for the grant of stock-based compensation to officers, employees, and non-employee directors.
The amount of compensation cost related to stock-based payment transactions is measured based on the grant-date fair value of the equity instruments issued. The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model. The Company determines compensation cost for restricted stock units (“RSUs”), phantom stock units, and restricted stock based on the grant-date fair value of the underlying common stock. Compensation cost is recognized over the period that an officer, employee, or non-employee director provides service in exchange for the award.
The following table summarizes stock-based compensation expense recognized
(in thousands)
:
Stock-based compensation expense for the fiscal quarter and six fiscal months ended July 2, 2011 includes amounts associated with the acceleration of vesting of awards upon the death of Vishay’s Executive Chairman of the Board of Directors, Dr. Felix Zandman. In accordance with Dr. Zandman’s employment agreement, 98,375 RSUs held by Dr. Zandman immediately vested and were contributed to his estate upon his death and 202,330 RSUs with performance-based vesting criteria will be
contributed to his estate upon the Company’s achievement of the performance-based criteria. Additionally, the vesting of 77,334 stock options was accelerated. These options may be exercised by Dr. Zandman’s estate within one year from his death pursuant to the Company’s 2007 Stock Incentive Program (as amended, the “2007 Program”).
The following table summarizes unrecognized compensation cost and the weighted average remaining amortization periods at July 2, 2011
(dollars in thousands, amortization periods in years)
:
2007 Stock Incentive Plan
The Company’s 2007 Program permits the grant of up to 3,000,000 shares of restricted stock, unrestricted stock, RSUs, and stock options, to officers, employees, and non-employee directors. Such instruments are available for grant until May 22, 2017.
The 2007 Program was originally approved by stockholders of the Company on May 22, 2007, as the “2007 Stock Option Program.” On May 28, 2008, the Company’s stockholders approved amendments to the 2007 Stock Option Program, which was then renamed the “2007 Stock Incentive Program.”
On February 23, 2011, the Board of Directors of the Company amended and restated the 2007 Program. The amendment eliminated share recycling, so that on the exercise of an option where the exercise price is paid via the tender of previously-owned shares or pursuant to an “immaculate cashless exercise,” the total “gross” number of option shares exercised is removed from the pool of shares available for future issuance. Similarly, shares withheld to pay income taxes in connection with the exercise of an option are also removed from the pool. The amendment also restricts re-pricing and cash repurchases of options without the prior approval of stockholders.
Stock Options
In addition to stock options outstanding pursuant to the 2007 Program, the Company has stock options outstanding under previous stockholder-approved stock option programs. These programs are more fully described in Note 12 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2010. No additional options may be granted pursuant to these programs.
Option activity under the stock option plans as of July 2, 2011 and changes during the six fiscal months then ended are presented below
(number of options in thousands, contractual life in years)
:
During the six
fiscal months ended July 2, 2011, 155,000 options vested. At July 2, 2011, there are 98,000 unvested options outstanding, with a weighted average grant-date fair value of $8.50 per option.
The pretax aggregate intrinsic value (the difference between the closing stock price on the last trading day of the second fiscal quarter of 2011 of $15.70 per share and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on July 2, 2011 is $549,000. This amount changes based on changes in the market value of the Company’s common stock. During the six fiscal months ended July 2, 2011, 534,000 options were exercised. The total intrinsic value of options exercised during the six fiscal months ended July 2, 2011 was approximately $1,628,000.
Restricted Stock Units
RSU activity under the 2007 Program as of July 2, 2011 and changes during the six fiscal months then ended are presented below
(number of RSUs in thousands)
:
* The number of RSUs vested includes shares that the Company withheld on behalf of employees to satisfy the statutory tax withholding requirements.
The Company recognizes compensation cost for RSUs that are expected to vest. The Company expects all performance-based vesting criteria to be achieved.
RSUs with performance-based vesting criteria are expected to vest as follows
(number of RSUs in thousands)
:
Phantom Stock Plan
The Company maintains a phantom stock plan for certain senior executives. The Phantom Stock Plan authorizes the grant of up to 300,000 phantom stock units to the extent provided for in employment agreements with the Company. Following the completion of the spin-off of VPG in 2010 and the passing of Dr. Zandman in the second fiscal quarter of 2011, the Company has such employment arrangements with two of its executives. The arrangements provide for an annual grant of 5,000 shares of phantom stock to each of these executives on the first trading day of the year. If the Company later enters into other employment arrangements with other individuals that provide for the granting of phantom stock, those individuals also will be eligible for grants under the Phantom Stock Plan. No grants may be made under the Phantom Stock Plan other than under the terms of employment arrangements with the Company. Each phantom stock unit entitles the recipient to receive a share of common stock at the individual’s termination of employment or any other future date specified in the employment agreement. The phantom stock units are fully vested at all times. In accordance with the Phantom Stock Plan, following Dr. Zandman’s passing, 43,667 phantom stock units held by Dr. Zandman’s estate were redeemed as common stock.
Phantom stock units activity under the 2007 Program as of July 2, 2011 and changes during the six fiscal months then ended are presented below
(number of phantom stock units in thousands)
:
|
Commitments and Contingencies (Details Textuals) (USD $)
|
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2011
|
Jul. 03, 2010
|
Jul. 02, 2011
|
Jul. 03, 2010
|
|
Annual Executive Payment | $ 10,000,000 | |||
Royalty Payment Percentage | 5.00% | |||
Executive Compensation Charge | $ 3,889,000 | $ 0 | $ 3,889,000 | $ 0 |
Consolidated Condensed Statement of Equity [Parenthetical]
|
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Statement of Stockholders' Equity [Abstract] | |
Phantom and restricted stock issuances (Shares) | 167,629 |
Stock repurchase, (in shares) | 8,620,689 |
Number of options, exercised | (534,000) |
Conversions from Class B to common stock (in shares) | 900,290 |
Income Taxes
|
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 3 – Income Taxes
The provision for income taxes consists of provisions for federal, state, and foreign income taxes. The effective tax rates for the periods ended July 2, 2011 and July 3, 2010 reflect the Company’s expected tax rate on reported income from continuing operations before income tax and tax adjustments. The Company operates in a global environment with significant operations in various locations outside the United States. Accordingly, the consolidated income tax rate is a composite rate reflecting the Company’s earnings and the applicable tax rates in the various locations where the Company operates.
In January 2011, a new tax law was enacted in Israel which effectively lowered the corporate income tax rate on certain types of income earned after December 31, 2010. Accordingly, the Company’s deferred tax assets in Israel were written down to reflect the lower rate and a one-time tax expense of $10.0 million was recorded in the consolidated condensed statement of operations during the six fiscal months ended July 2, 2011.
During the six fiscal months ended July 2, 2011, the liabilities for unrecognized tax benefits increased by $4.7 million on a net basis, principally due to increases for positions taken during prior periods, interest, and foreign exchange effects.
|
Stock-Based Compensation (Details 3) (Restricted Stock Units (RSUs) [Member], USD $)
In Thousands, except Per Share data |
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Restricted Stock Units (RSUs) [Member]
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of RSUs, Outstanding Balance | 634 |
Number of RSUs, granted | 398 |
Number of RSUs, vested | (126) |
Number of RSUs, cancelled or forfeited | 0 |
Number of RSUs, Outstanding Balance | 906 |
Expected to vest at April 2, 2011 | 906 |
Weighted average grant date fair value per unit of RSUs, Outstanding | $ 9.61 |
Weighted average grant date fair value per unit of RSUs, granted | $ 16.91 |
Weighted average grant date fair value per unit of RSUs, vested | $ 10.95 |
Weighted average grant date fair value per unit of RSUs, cancelled or forfeited | $ 0 |
Weighted average grant date fair value per unit of RSUs, Outstanding | $ 12.63 |
Long-Term Debt (Details 3) (USD $)
In Thousands |
6 Months Ended | 3 Months Ended | 6 Months Ended | |
---|---|---|---|---|
Jul. 02, 2011
|
Jul. 03, 2010
|
Jul. 02, 2011
Convertible Senior Debentures Due In 2040
|
Jul. 02, 2011
Convertible Senior Debentures Due In 2040
|
|
Contractual coupon interest | $ 1,547 | $ 3,094 | ||
Accretion of interest on convertible debentures | 861 | 0 | 383 | 759 |
Non-cash amortization of deferred financing costs | 22 | 44 | ||
Non-cash change in value of derivative liability | 69 | 8 | ||
Total interest expense related to the debentures | $ 2,021 | $ 3,905 |
Fair Value Measurements (Details Textuals) (USD $)
In Millions |
6 Months Ended | |
---|---|---|
Jul. 02, 2011
|
Dec. 31, 2010
|
|
Long-term Debt, Fair Value | $ 751.7 | $ 624.8 |
Long-term Debt | $ 421.9 | $ 431.4 |
Fair Value of Financial Instruments, Policy | The fair value measurement accounting guidance establishes a valuation hierarchy of the inputs used to measure fair value. This hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:
Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3: Unobservable inputs that reflect the Company’s own assumptions.
An asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. There have been no changes in the classification of any financial instruments within the fair value hierarchy in the periods presented.
|
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Convertible Senior Debentures Due In 2040
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The convertible senior debentures | November 9, 2010 | |
Convertible Senior Debentures Due In 2041
|
||
The convertible senior debentures | May 13, 2011 |
Long-Term Debt
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Jul. 02, 2011
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt |
Note 4 – Long-Term Debt
Long-term debt consists of the following (in thousands):
Convertible Senior Debentures, due 2041
On May 13, 2011, Vishay issued $150 million principal amount of 2.25% convertible senior debentures due 2041 to qualified institutional investors. Vishay used the net proceeds from this offering, together with cash on hand, to repurchase 8,620,689 shares of common stock for an aggregate purchase price of $150 million.
GAAP requires an issuer to separately account for the liability and equity components of the instrument in a manner that reflects the issuer’s nonconvertible debt borrowing rate when interest costs are recognized in subsequent periods. The resulting discount on the debt is amortized as non-cash interest expense in future periods.
The carrying values of the liability and equity components of the convertible debentures are reflected in the Company’s consolidated condensed balance sheets as follows (in thousands):
Interest is payable on the debentures semi-annually at a rate of 2.25% per annum; however, the remaining debt discount is being amortized as additional non-cash interest expense using an effective annual interest rate of 8.375% based on the Company’s estimated nonconvertible debt borrowing rate at the time of issuance. In addition to ordinary interest, beginning on May 15, 2021, contingent interest will accrue in certain circumstances relating to the trading price of the debentures and under certain other circumstances.
Interest expense related to the debentures is reflected on the consolidated condensed statements of operations as follows (in thousands):
Prior to February 15, 2041, the holders may only convert their debentures under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ending October 1, 2011 if the sale price of Vishay common stock reaches 130% of the conversion price ($24.73) for a specified period; (2) the trading price of the debentures falls below 98% of the product of the sale price of Vishay’s common stock and the conversion rate for a specified period; (3) Vishay calls any or all of the debentures for redemption, at any time prior to the close of business on the third scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. None of these conditions had occurred as of July 2, 2011.
The debentures are initially convertible, subject to certain conditions, into cash, shares of Vishay’s common stock or a combination thereof, at Vishay’s option, at an initial conversion rate of 52.5659 shares of common stock per $1,000 principal amount of debentures. This represents an initial effective conversion price of approximately $19.02 per share. This initial conversion price represents a premium of 12.5% to the closing price of Vishay’s common stock on the date the offering commenced, which was $16.91 per share. At the direction of its Board of Directors, Vishay intends, upon conversion, to repay the principal amount of the debentures in cash and settle any additional amounts in shares. Vishay must provide additional shares upon conversion if there is a “fundamental change” in the business as defined in the indenture governing the debentures.
Vishay may not redeem the debentures prior to May 20, 2021, except in connection with certain tax-related events. On or after May 20, 2021 and prior to the maturity date, Vishay may redeem for cash all or part of the debentures at a redemption price equal to 100% of the principal amount of the debentures to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date, if the last reported sale price of Vishay’s common stock has been at least 150% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period prior to the date on which Vishay provides notice of redemption.
Convertible Senior Debentures, due 2040
On November 9, 2010, Vishay issued $275 million principal amount of 2.25% convertible senior debentures due 2040 to qualified institutional investors. GAAP requires an issuer to separately account for the liability and equity components of a convertible debt instrument in a manner that reflects the issuer’s nonconvertible debt borrowing rate when interest costs are recognized in subsequent periods. The resulting discount on the debt is amortized as non-cash interest expense in future periods.
The carrying values of the liability and equity components of the convertible debentures are reflected in the Company’s consolidated condensed balance sheets as follows (in thousands):
Interest is payable on the debentures semi-annually at a rate of 2.25% per annum; however, the remaining debt discount is being amortized as additional non-cash interest expense using an effective annual interest rate of 8.00% based on the Company’s estimated nonconvertible debt borrowing rate at the time of issuance. In addition to ordinary interest, beginning on November 15, 2020, contingent interest will accrue in certain circumstances relating to the trading price of the debentures and under certain other circumstances.
Interest expense related to the debentures is reflected on the consolidated condensed statements of operations as follows (in thousands):
|
Stock-Based Compensation (Details 5) (USD $)
In Thousands, except Per Share data |
6 Months Ended |
---|---|
Jul. 02, 2011
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
January 1, 2011 | 116 |
Granted | 15 |
Redeemed for common stock | (44) |
Outstanding at April 2, 2011 | 87 |
Granted | $ 14.78 |
Long-Term Debt (Details) (USD $)
In Thousands |
Jul. 02, 2011
|
Dec. 31, 2010
|
---|---|---|
Credit facility | $ 180,000 | $ 240,000 |
Exchangeable unsecured notes, due 2102 | 95,042 | 95,042 |
Less current portion | 0 | 0 |
Long-term debt less current portion | 422,422 | 431,682 |
Convertible Senior Debentures Due In 2040
|
||
Convertible senior debentures | 97,407 | 96,640 |
Convertible Senior Debentures Due In 2041
|
||
Convertible senior debentures | $ 49,973 | $ 0 |
Comprehensive Income (Loss) (Details) (USD $)
In Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2011
|
Jul. 03, 2010
|
Jul. 02, 2011
|
Jul. 03, 2010
|
|
Net earnings | $ 82,496 | $ 76,965 | $ 158,103 | $ 122,604 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | 18,691 | (50,012) | 64,419 | (79,496) |
Unrealized gain (loss) on available for sale securities | (851) | (528) | (240) | (133) |
Pension and other postretirement adjustments | 482 | (6,768) | 2,416 | (4,998) |
Total other comprehensive income (loss) | 18,322 | (57,308) | 66,595 | (84,627) |
Comprehensive income | 100,818 | 19,657 | 224,698 | 37,977 |
Less: Comprehensive income attributable to noncontrolling interests | 401 | 306 | 721 | 525 |
Comprehensive income attributable to Vishay stockholders | $ 100,417 | $ 19,351 | $ 223,977 | $ 37,452 |
Stock-Based Compensation (Details 4) (Performance Vested Restricted Stock Units [Member])
In Thousands |
Jul. 02, 2011
|
---|---|
Performance Vested Restricted Stock Units [Member]
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of RSUs with performance-based vesting criteria expected to vest | 324 |
Number of RSUs with performance-based vesting criteria expected to vest | 215 |
Long-Term Debt (Details 2) (USD $)
In Thousands |
6 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | |
---|---|---|---|---|---|---|
Jul. 02, 2011
|
Jul. 03, 2010
|
Jul. 02, 2011
Convertible Senior Debentures 2041
|
Jul. 02, 2011
Convertible Senior Debentures 2041
|
Jul. 02, 2011
Convertible Senior Debentures Due In 2040
|
Jul. 02, 2011
Convertible Senior Debentures Due In 2040
|
|
Contractual coupon interest | $ 441 | $ 441 | $ 1,547 | $ 3,094 | ||
Accretion of interest on convertible debentures | 861 | 0 | 102 | 102 | 383 | 759 |
Non-cash amortization of deferred financing costs | 6 | 6 | 22 | 44 | ||
Non-cash change in value of derivative liability | 2 | 2 | 69 | 8 | ||
Total interest expense related to the debentures | $ 551 | $ 551 | $ 2,021 | $ 3,905 |
Long-Term Debt (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jul. 02, 2011
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Long-Term Debt (Tables) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-term Debt Instruments [Table Text Block] |
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Liability And Equity Component Of Convertible Senior Debenture due 2040 [Table TextBlock] |
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Liability And Equity Component Of Convertible Senior Debenture due 2041 [Table TextBlock] |
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Convertible Debentures Due In 2041 Interest Expense [Table TextBlock] |
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Convertible Debentures Due In 2040 Interest Expense [Table Text Block] |
Interest expense related to the debentures is reflected on the consolidated condensed statements of operations as follows (in thousands):
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