EX-99 2 vi5641ex99.txt EXHIBIT 99 Exhibit 99 VISHAY REPORTS RESULTS FOR FIRST QUARTER 2006 - Sales for first quarter 2006 increased by $76.7 million, or 13.8%, compared to first quarter 2005 and $37.4 million, or 6.3%, compared to fourth quarter 2005. - Book-to-bill ratio for first quarter 2006 was 1.14. - Net earnings of $0.20 per diluted share for the first quarter 2006 have been negatively affected by the after tax impact of certain items (enumerated below) of $0.05 per share for adjusted earnings per share of $0.25, as compared to fourth quarter 2005 net earnings of $0.14 per diluted share, which were negatively affected by the after tax impact of certain items of $0.03 per share for adjusted earnings per share of $0.17. - Expect year 2006 for sales and earnings to be best after the record year 2000. MALVERN, Pa., May 2 /PRNewswire-FirstCall/ -- Dr. Felix Zandman, Chairman of the Board, and Dr. Gerald Paul, President and Chief Executive Officer of Vishay Intertechnology, Inc. (NYSE: VSH), announced today that net revenues for the fiscal quarter ended April 1, 2006 were $631,086,000, compared to $554,366,000 for the fiscal quarter ended April 2, 2005, an increase of $76.7 million or 13.8%. Net earnings for the fiscal quarter ended April 1, 2006 were $38,160,000, or $0.20 per diluted share, compared with net earnings for the fiscal quarter ended April 2, 2005 of $5,712,000, or $0.03 per diluted share. Net earnings of $38,160,000, or $0.20 per diluted share, for the fiscal quarter ended April 1, 2006 were impacted by pre-tax charges for restructuring and severance costs and related asset write-downs of $778,000, losses resulting from adjustments to previously existing purchase commitments of $3,303,000 and write-downs of tantalum inventories to current market value of $8,228,000. These items and their tax-related consequences had a negative $0.05 effect on earnings per share. Net earnings of $5,712,000, or $0.03 per diluted share, for the fiscal quarter ended April 2, 2005 were impacted by restructuring and severance costs of $5,027,000 and losses resulting from adjustments to previously existing purchase commitments of $2,277,000. These items and their tax related consequences had a negative $0.03 effect on earnings per diluted share. Commenting on the results for the first quarter 2006, Dr. Paul stated, "We had a very good first quarter increasing our sales sequentially by 6.3% and adjusted net earnings by 47.1%. Demand from all regions and virtually all market segments is strong. Inventories in the supply chain continue to be low. The increased orders from distribution are supported by increased orders from their end customers. The pricing pressure has been low and we start to see opportunities for price increases. In the current general upturn, we are reaping the fruits of our restructuring activities. Both our carefully controlled expansion and our restructuring programs are on track and will continue to show results." Commenting on the outlook for the second quarter 2006, Dr. Paul continued, "Based on a continuously strong book-to-bill in the first quarter and in April so far, we guide for sales in the range of $650 million to $670 million. We expect margins to be higher than in the first quarter 2006 due to higher volume, some pricing leverage and continued cost reduction. With lean inventories in the supply chain and broad based, solid end demand, we believe that 2006 will be our best year since 2000." Commenting on the Company's acquisition activities, Dr. Felix Zandman, Chairman of the Board and Chief Technical and Business Development Officer, stated, "In the fourth quarter 2005 we acquired a Japanese manufacturer of specialty components. We expect to acquire in the current quarter a Brazilian manufacturer of specialty components. Both companies have sales of below $20 million. These acquisitions will round off our product portfolio and will place us as a manufacturer in markets where Vishay is weak." Dr. Zandman also noted, "We introduce continuously new products in each of our divisions as well as create new products through vertical integration. For example, we have recently introduced a technology of wireless aircraft weighing consisting of our load cells outfitted with our wireless transmitters and hand-held receivers with sophisticated software." A conference call to discuss first quarter financial results is scheduled for Tuesday, May 2, 2006 at 10:00 AM (EDT). The dial-in number for the conference call is 877-589-6174 (+1 706-643-1406 if calling from outside the United States or Canada) and the conference ID is #7860377. There will be a replay of the conference call from 12:30 PM (EDT) on Tuesday, May 2, 2006 through 11:59 PM (EDT) on Sunday, May 7, 2006. The telephone number for the replay is 800-642-1687 (+1 706-645-9291 if calling from outside the United States or Canada) and the access code is #7860377. There will also be a live audio webcast of the conference call. This can be accessed directly from the Investor Relations section of the Vishay website at http://ir.vishay.com. An audio file of the webcast will also be available on the Vishay website following the call. Vishay Intertechnology, Inc., a Fortune 1,000 Company listed on the NYSE (VSH), is one of the world's largest manufacturers of discrete semiconductors (diodes, rectifiers, transistors, and optoelectronics and selected ICs) and passive electronic components (resistors, capacitors, inductors, sensors, and transducers). Vishay's components can be found in products manufactured in a very broad range of industries worldwide. Vishay is headquartered in Malvern, Pennsylvania, and has operations in 17 countries employing over 26,000 people. Vishay can be found on the Internet at http://www.vishay.com. Statements contained herein that relate to the Company's future performance, including statements with respect to trends in revenues, bookings, and margins and the anticipated future benefits of the Company's product, acquisition, research and development and cost reduction strategies are forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on current expectations only, and are subject to certain risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions, particularly in the markets that we serve, the availability of appropriate acquisition opportunities on terms that the Company considers attractive, difficulties in integrating acquired companies, difficulties in implementing our cost reduction strategies such as labor unrest or legal challenges to our lay-off or termination plans, under- utilization of production facilities in lower-labor-cost countries, operation of redundant facilities due to difficulties in transferring production to lower-labor-cost countries, difficulties in new product development, an inability to attract and retain highly qualified personnel, and other factors affecting the Company's operations, markets, products, services, and prices that are set forth in its Annual Report on Form 10-K for the year ended December 31, 2005 filed with the Securities and Exchange Commission. You are urged to refer to the Company's Form 10-K for a detailed discussion of these factors. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Management believes that stating the impact on net earnings of items such as restructuring and severance, asset write-downs, charges for in-process research and development, gains or losses on purchase commitments, special tax items and other items not reflecting on-going operating activities is meaningful to investors because it provides insight with respect to intrinsic operating results of the Company and, management believes, is a common measure of performance in the industries in which the Company competes. Investors should be aware, however, that this is a non-GAAP measure of performance and should not be considered as a substitute for the comparable GAAP measure. VISHAY INTERTECHNOLOGY, INC. Summary of Operations (Unaudited - In thousands except earnings per share) Fiscal quarter ended --------------------------- April 1, April 2, 2006 2005 ------------ ------------ Net revenues $ 631,086 $ 554,366 Costs of products sold* 471,286 435,270 Loss on purchase commitments 3,303 2,277 Gross profit 156,497 116,819 Gross margin 24.8% 21.1% Selling, general, and administrative expenses 95,852 96,340 Restructuring and severance costs and related asset write-downs 778 5,027 Operating income 59,867 15,452 Operating margin 9.5% 2.8% Other income (expense): Interest expense (8,657) (8,053) Minority interest (186) (2,652) Other 4,281 3,653 Total other income (expense) - net (4,562) (7,052) Earnings before taxes 55,305 8,400 Income taxes 17,145 2,688 Net earnings $ 38,160 $ 5,712 Basic earnings per share $ 0.21 $ 0.03 Diluted earnings per share $ 0.20 $ 0.03 Weighted average shares outstanding - basic 184,272 166,107 Weighted average shares outstanding - diluted 218,611 167,153 * The fiscal quarter ended April 1, 2006 includes write-downs of tantalum inventories of $8,228 within costs of products sold. VISHAY INTERTECHNOLOGY, INC. Consolidated Condensed Balance Sheets (In thousands) April 1, December 31, 2006 2005 ------------ ------------ (Unaudited) Assets Current assets: Cash and cash equivalents $ 656,265 $ 622,577 Short-term investments -- 9,925 Accounts receivable - net 375,089 350,850 Inventories: Finished goods 151,092 149,709 Work in process 192,630 181,125 Raw materials 167,205 157,036 Deferred income taxes 40,255 39,115 Prepaid expenses and other current assets 92,505 96,295 Total current assets 1,675,041 1,606,632 Property and equipment, at cost: Land 92,895 92,650 Buildings and improvements 410,470 406,798 Machinery and equipment 1,707,357 1,684,736 Construction in progress 72,965 67,229 Allowance for depreciation (1,197,212) (1,160,821) 1,086,475 1,090,592 Goodwill 1,433,727 1,434,901 Other intangible assets, net 171,204 174,220 Other assets 209,749 221,246 Total assets $ 4,576,196 $ 4,527,591 VISHAY INTERTECHNOLOGY, INC. Consolidated Condensed Balance Sheets (continued) (In thousands) April 1, December 31, 2006 2005 ------------ ------------ (Unaudited) Liabilities and stockholders' equity Current liabilities: Notes payable to banks $ 5,616 $ 3,473 Trade accounts payable 136,777 142,709 Payroll and related expenses 122,288 118,814 Other accrued expenses 161,998 173,982 Income taxes 38,344 29,655 Current portion of long-term debt 140,269 1,533 Total current liabilities 605,292 470,166 Long-term debt less current portion 613,287 751,553 Deferred income taxes 26,932 27,091 Deferred grant income 10,376 11,896 Other liabilities 149,867 149,938 Accrued pension and other postretirement costs 261,617 256,986 Minority interest 3,994 4,109 Stockholders' equity: Common stock 16,968 16,946 Class B common stock 1,468 1,468 Capital in excess of par value 2,228,404 2,225,966 Retained earnings 695,326 657,166 Unearned compensation -- (95) Accumulated other comprehensive income (37,335) (45,599) Total stockholders' equity 2,904,831 2,855,852 Total liabilities and stockholders' equity $ 4,576,196 $ 4,527,591 VISHAY INTERTECHNOLOGY, INC. Reconciliation of Earnings Per Share (Unaudited - In thousands except earnings per share) Fiscal quarter ended ----------------------------- April 1, 2006 April 2, 2005 ------------- ------------- Numerator: Numerator for basic earnings per share - net earnings $ 38,160 $ 5,712 Interest savings assuming conversion of dilutive convertible and exchangeable notes, net of tax 4,799 - Numerator for diluted earnings per share - adjusted net earnings $ 42,959 $ 5,712 Denominator: Denominator for basic earnings per share - weighted average shares 184,272 166,107 Effect of dilutive securities Convertible and exchangeable notes** 33,481 -- Employee stock options 769 970 Warrants -- -- Other 89 76 Dilutive potential common shares 34,339 1,046 Denominator for diluted earnings per share - adjusted weighted average shares 218,611 167,153 Basic earnings per share $ 0.21 $ 0.03 Diluted earnings per share $ 0.20 $ 0.03 Diluted earnings per share for the periods presented do not reflect the following weighted-average potential common shares, as the effect would be antidilutive: Fiscal quarter ended ----------------------------- April 1, 2006 April 2, 2005 ------------- ------------- Convertible and exchangeable notes: Convertible Subordinated Notes, due 2023 -- 23,496 LYONs, due 2021** -- 10,262 Exchangeable Unsecured Notes, due 2102 -- 6,176 Weighted average employee stock options 5,282 6,065 Weighted average warrants 8,824 8,824 ** By their terms, the LYONs were convertible into 3,809 shares of common stock at April 1, 2006 and April 2, 2005, respectively. In 2005, based on its action to settle the holders' purchase option on the June 4, 2004 purchase date in common stock, the Company assumed for purposes of the earnings per share computation that all future purchase options for the LYONs would be settled in stock based on the settlement formula set forth in the indenture governing the LYONs. Based on the Company's stated intention to settle the June 4, 2006 purchase option in cash, the earnings per share computation for the first quarter of 2006 is based on the 3,809 shares that would be issued in a normal conversion. SOURCE Vishay Intertechnology, Inc. -0- 05/02/2006 /CONTACT: Peter G. Henrici, Senior Vice President Corporate Communications of Vishay Intertechnology, +1-610-644-1300/ /Web site: http://www.vishay.com http://ir.vishay.com / (VSH)