EX-99.1 2 vpg-2023q4earnings8kxex991.htm EX-99.1 Document

                                            Exhibit 99.1
For Immediate Release
VPG Reports Fiscal 2023 Fourth Quarter and Twelve Month Results
MALVERN, Pa. (February 14, 2024) - Vishay Precision Group, Inc. (NYSE: VPG), a leader in precision measurement technologies, today announced its results for its fiscal 2023 fourth quarter and twelve fiscal months ended December 31, 2023.
Fourth Quarter Highlights:
Revenues of $89.5 million decreased 7.0% from a year ago
Gross profit margin was 43.0%, as compared to 41.2% a year ago
Adjusted gross profit margin* was 43.0%, as compared to 41.5% a year ago
Operating margin was 13.4%, as compared to 13.6% reported a year ago
Adjusted operating margin* was 13.6%, as compared to 14.0% reported a year ago
Diluted net earnings per share were $0.31, as compared to $0.65 reported a year ago
Adjusted diluted net earnings per share* were $0.61, as compared to $0.76 reported a year ago
EBITDA* was $13.4 million with an EBITDA margin* of 15.0%
Adjusted EBITDA* was $16.5 million with an adjusted EBITDA margin* of 18.5%
Cash from operating activities was $18.8 million with adjusted free cash flow* of $13.5 million

2023 Full Year Highlights:
Revenues of $355.0 million decreased 2.1% year-over-year
Gross profit margin was 42.3%, as compared to 41.3% a year ago
Adjusted gross profit margin* was 42.4%, as compared to 41.8% a year ago
Operating margin was 11.8%, as compared to 12.1% reported last year
Adjusted operating margin* was 12.4%, as compared to 13.0% reported last year
Diluted net earnings per share were $1.88, as compared to $2.63 reported a year ago
Adjusted diluted net earnings per share* were $2.17, as compared to $2.62 reported a year ago
EBITDA* was $57.7 million with an EBITDA margin* of 16.2%
Adjusted EBITDA* was $60.4 million with an adjusted EBITDA margin* of 17.0%
Cash from operating activities was $45.9 million with adjusted free cash flow* of $30.8 million

Ziv Shoshani, Chief Executive Officer of VPG, commented, "We achieved solid financial results and record adjusted free cash flow in fiscal 2023, despite a more challenging macro environment in the second half of the year. For the fourth quarter, we grew revenue 4.3% compared to the third quarter of 2023, and delivered adjusted diluted net earnings per share* of $0.61. Reflecting our strong cash flow, we delivered adjusted EBITDA* of $16.5 million, an adjusted EBITDA margin* of 18.5%, and $13.5 million of adjusted free cash flow*. We continued to deploy our capital to create stockholder value in the fourth quarter with $4.7 million of stock repurchases and the $22.0 million repayment of our revolving credit facility that is expected to significantly reduce interest expense in 2024.
Fourth quarter bookings of $75.2 million declined 2.2% sequentially. While orders in our Measurement Systems segment declined due to timing of customer projects, orders in our Sensors and Weighing Solutions segment grew slightly, reflecting a modestly improved business environment. We expect to see further improvement in the second half of 2024 given our expanding pipeline of long-term opportunities for our precision measurement and sensor technologies, as we engage new and existing customers with solutions that make the world safer, smarter, and more productive."
The Company's fourth fiscal quarter 2023 net earnings attributable to VPG stockholders were $4.2 million, or $0.31 per diluted share, compared to $8.8 million, or $0.65 per diluted share, in the fourth fiscal quarter of 2022.
In the fiscal year ended December 31, 2023, net earnings attributable to VPG stockholders were $25.7 million, or $1.88 per diluted share, compared to $36.1 million, or $2.63 per diluted share, in the fiscal year ended December 31, 2022.
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The fourth fiscal quarter 2023 adjusted net earnings* attributable to VPG stockholders were $8.2 million, or $0.61 per diluted share, compared to adjusted net earnings* attributable to VPG stockholders of $10.4 million, or $0.76 per diluted share, for the comparable prior year period.
In the fiscal year ended December 31, 2023, adjusted net earnings* attributable to VPG stockholders were $29.7 million, or $2.17 per diluted share, compared to adjusted net earnings* attributable to VPG stockholders of $35.9 million, or $2.62 per diluted share, for the comparable prior year period.
Segment Performance
The Sensors segment revenues of $34.3 million in the fourth fiscal quarter of 2023 decreased 5.7% from the prior year of $36.3 million and increased 5.3% sequentially from $32.5 million in the third quarter of 2023. The year-over-year decrease in revenues was primarily attributable to lower sales of advanced sensors in our Other markets for consumer applications, and in our Avionics, Military and Space ("AMS") market, and in our General Industrial market, which offset higher sales of precision resistors in the Test and Measurement market. Sequentially, the increase in revenues primarily reflected higher precision resistor sales in the Test and Measurement market.
Gross profit margin for the Sensors segment of 40.2% for the fourth fiscal quarter of 2023 was higher compared to 37.6% in the fourth fiscal quarter of 2022, and higher compared to 35.9% in the third fiscal quarter of 2023. The year-over-year increase in gross profit margin was primarily due to favorable foreign exchange rates and improved manufacturing efficiencies, which offset the impact of lower volume. Sequentially, the increase in gross profit margin was primarily due to higher volume and improved manufacturing efficiencies.
The Weighing Solutions segment revenues of $30.4 million in the fourth fiscal quarter of 2023 decreased 8.0% from $33.1 million in the prior year and increased 5.1% from $29.0 million in the third quarter of 2023. The year-over-year decline in revenues was primarily attributable to lower revenues in our Industrial Weighing market and lower revenues from OEM customers for precision agriculture applications in our Other market segment. The sequential increase in revenues was primarily attributable to increased revenues from OEM customers for precision agriculture and construction applications in our Other market segment and higher revenue in our General Industrial market, partially offset by lower sales in the Transportation market.
Gross profit margin for the Weighing Solutions segment was 35.6% for the fourth fiscal quarter of 2023, an increase compared to 33.4% in the fourth fiscal quarter of 2022, and a decrease compared to 38.7% in the third fiscal quarter of 2023. The year-over-year increase in gross profit margin was primarily due to increased selling prices, favorable foreign currency exchange rates, and manufacturing efficiencies, partially offset by lower volume. Sequentially, the decline in gross profit margin was primarily due to a reduction in inventory and unfavorable product mix, partially offset by higher volume.
The Measurement Systems segment revenues in the fourth fiscal quarter of 2023 of $24.8 million decreased 7.5% from $26.8 million in the prior year and increased 2.0% sequentially from $24.4 million in the third fiscal quarter of 2023. The year-over-year decline in revenues was primarily attributable to lower sales of Dynamic Systems Inc. ("DSI") and KELK products to the steel market and lower sales of Diversified Technical Systems, Inc. ("DTS") products to the Transportation market, which was partially offset by higher sales of DTS products to the AMS market. The sequential increase in revenue was primarily attributable to higher sales of DTS products to the AMS market, which was partially offset by lower sales of DSI and KELK products to the Steel market.
Gross profit margin for the Measurement Systems segment was 56.0% for the fourth fiscal quarter of 2023, compared to 55.9% (or 56.8% adjusted to exclude the $0.2 million purchasing accounting adjustments related to the DTS acquisition) in the fourth fiscal quarter of 2022, and compared to 53.6% (or 54.5% adjusted to exclude the $0.2 million of purchasing accounting adjustments related to the DTS acquisition) from the third fiscal quarter of 2023. Year-over-year, the decline in adjusted gross profit margin* was primarily due to lower volume. Sequentially, the higher adjusted gross profit margin* in the fourth quarter of 2023 reflected higher volume and favorable product mix.

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Near-Term Outlook
“For the first fiscal quarter of 2024 at constant fourth fiscal quarter 2023 exchange rates, we expect net revenues to be in the range of $80 million to $90 million,” said Mr. Shoshani.

*Use of Non-GAAP Financial Information
We define “adjusted gross profit margin" as gross profit margin before purchase accounting adjustments related to the DTS and DSI acquisitions, start-up costs related to our new advanced sensors facility, and COVID-19 costs. We define "adjusted operating margin" as operating margin before purchase accounting adjustments related to the DTS and DSI acquisitions, start-up costs related to our new advanced sensors facility, COVID-19 costs, and restructuring costs. We define "adjusted net earnings” and "adjusted diluted net earnings per share" as net earnings attributable to VPG stockholders before purchase accounting adjustments related to the DTS and DSI acquisitions, start-up costs related to our new advanced sensors facility, COVID-19 costs, restructuring costs, foreign currency exchange gains and losses, and associated tax effects. We define "EBITDA" as earnings before interest, taxes, depreciation, and amortization. We define "Adjusted EBITDA" as earnings before interest, taxes, depreciation, and amortization before purchase accounting adjustments related to the DTS and DSI acquisitions, start-up costs related to our new advanced sensors facility, COVID-19 costs, restructuring costs, foreign currency exchange gains and losses, and associated tax effects.
"Adjusted free cash flow" for the fourth fiscal quarter of 2023 is defined as the amount of cash generated from operating activities ($18.8 million), in excess of our capital expenditures ($5.3 million), net of proceeds, if any, from the sale of assets ($0.0 million). "Adjusted free cash flow" for the fiscal year of 2023 is defined as the amount of cash generated from operating activities ($45.9 million) in excess of our capital expenditures ($15.2 million), net of proceeds, if any, from the sale of assets ($0.1 million).
Management believes that these non-GAAP measures are useful to investors because each presents what management views as our core operating results for the relevant period. The adjustments to the applicable GAAP measures relate to occurrences or events that are outside of our core operations, and management believes that the use of these non-GAAP measures provides a consistent basis to evaluate our operating profitability and performance trends across comparable periods. These reconciling items are indicated on the accompanying reconciliation schedules and are more fully described in VPG’s financial statements presented in our Annual Report on Form 10-K and Quarterly Reports on Forms 10-Q.

Conference Call and Webcast
A conference call is scheduled for Wednesday, February 14, 2024 at 9:00 a.m. ET (8:00 a.m. CT). To access the conference call, interested parties may call 1-833-470-1428 or internationally +1-404-975-4839 and use passcode 809176, or log on to the investor relations page of the VPG website at ir.vpgsensors.com.
A replay will be available approximately one hour after the completion of the call by calling toll-free 1-866-813-9403 or internationally +44-204-525-0658 and using the passcode 945428. The replay will also be available on the investor relations page of the VPG website at ir.vpgsensors.com for a limited time.

About VPG
Vishay Precision Group, Inc. (VPG) is a leader in precision measurement sensing technologies. Our sensors, weighing solutions and measurement systems optimize and enhance our customers’ product performance across a broad array of markets to make our world safer, smarter, and more productive.
To learn more, visit VPG at www.vpgsensors.com and follow us on LinkedIn.


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Forward-Looking Statements
From time to time, information provided by us, including, but not limited to, statements in this press release, or other statements made by or on our behalf, may contain or constitute "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks, uncertainties, and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from those anticipated.
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, expected, estimated, or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; impact of inflation; potential issues respecting the United States federal government debt ceiling; global labor and supply chain challenges; difficulties or delays in identifying, negotiating and completing acquisitions and integrating acquired companies; the inability to realize anticipated synergies and expansion possibilities; difficulties in new product development; changes in competition and technology in the markets that we serve and the mix of our products required to address these changes; changes in foreign currency exchange rates; political, economic, and health (including pandemics) instabilities; instability caused by military hostilities in the regions or countries in which we operate (including Israel); difficulties in implementing our cost reduction strategies, such as underutilization of production facilities, labor unrest or legal challenges to our lay-off or termination plans, operation of redundant facilities due to difficulties in transferring production to achieve efficiencies; compliance issues under applicable laws, such as export control laws, including the outcome of our voluntary self-disclosure of export control non-compliance; significant developments from the recent and potential changes in tariffs and trade regulation; our efforts and efforts by governmental authorities to mitigate the COVID-19 pandemic, such as travel bans, shelter-in-place orders and business closures and the related impact on resource allocations, manufacturing and supply chains; our status as a “critical”, “essential” or “life-sustaining” business in light of COVID-19 business closure laws, orders and guidance being challenged by a governmental body or other applicable authority; our ability to execute our new corporate strategy and business continuity, operational and budget plans; and other factors affecting our operations, markets, products, services, and prices that are set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this report or as of the dates otherwise indicated in such forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Contact:
Steve Cantor
Vishay Precision Group, Inc.
781-222-3516
info@vpgsensors.com





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VISHAY PRECISION GROUP, INC.
Consolidated Statements of Operations
(Unaudited - In thousands, except per share amounts)
Fiscal quarter ended
December 31, 2023December 31, 2022
Net revenues$89,528 $96,240 
Costs of products sold51,032 56,542 
Gross profit38,496 39,698 
Gross profit margin43.0 %41.2 %
Selling, general, and administrative expenses26,356 26,461 
Restructuring costs129 188 
Operating income12,011 13,049 
Operating margin13.4 %13.6 %
Other income (expense):
Interest expense(779)(876)
Other(2,509)(1,448)
Other expense - net(3,288)(2,324)
Income before taxes8,723 10,725 
Income tax expense4,403 1,884 
Net earnings4,320 8,841 
Less: net earnings attributable to noncontrolling interests93 
Net earnings attributable to VPG stockholders
$4,227 $8,834 
Basic earnings per share attributable to VPG stockholders
$0.31 $0.65 
Diluted earnings per share attributable to VPG stockholders
$0.31 $0.65 
Weighted average shares outstanding - basic
13,509 13,579 
Weighted average shares outstanding - diluted
13,604 13,677 

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VISHAY PRECISION GROUP, INC.
Consolidated Statements of Operations
(Unaudited - In thousands, except per share amounts)
Years ended
December 31, 2023December 31, 2022
Net revenues$355,048 $362,580 
Costs of products sold204,706 212,978 
Gross profit150,342 149,602 
Gross profit margin42.3 %41.3 %
Selling, general, and administrative expenses106,828 104,285 
Restructuring costs1,560 1,518 
Operating income41,954 43,799 
Operating margin11.8 %12.1 %
Other income (expense):
Interest expense(3,974)(2,269)
Other456 3,558 
Other (expense) income - net(3,518)1,289 
Income before taxes38,436 45,088 
Income tax expense12,426 8,535 
Net earnings26,010 36,553 
Less: net earnings attributable to noncontrolling interests303 490 
Net earnings attributable to VPG stockholders
$25,707 $36,063 
Basic earnings per share attributable to VPG stockholders
$1.89 $2.65 
Diluted earnings per share attributable to VPG stockholders
$1.88 $2.63 
Weighted average shares outstanding - basic
13,574 13,628 
Weighted average shares outstanding - diluted
13,653 13,688 

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VISHAY PRECISION GROUP, INC.
Consolidated Balance Sheets
(In thousands, except per share amounts)
December 31, 2023December 31, 2022
(Unaudited)
Assets
Current assets:
Cash and cash equivalents$83,965 $88,562 
Accounts receivable56,438 60,068 
Inventories:
Raw materials33,973 31,852 
Work in process26,594 26,401 
Finished goods27,572 26,407 
Inventories88,139 84,660 
Prepaid expenses and other current assets14,520 18,516 
Total current assets243,062 251,806 
Property and equipment:
Land4,154 4,117 
Buildings and improvements72,952 71,613 
Machinery and equipment131,738 125,301 
Software9,619 9,539 
Construction in progress11,379 10,075 
Accumulated depreciation(139,206)(133,518)
Property and equipment, net90,636 87,127 
Goodwill45,734 45,544 
Intangible assets, net44,634 48,217 
Operating lease right-of-use assets26,953 24,342 
Other assets20,547 19,706 
Total assets$471,566 $476,742 

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VISHAY PRECISION GROUP, INC.
Consolidated Balance Sheets
(In thousands, except per share amounts)
December 31, 2023December 31, 2022
(Unaudited)
Liabilities and equity
Current liabilities:
Trade accounts payable$11,698 $13,792 
Payroll and related expenses18,971 21,966 
Other accrued expenses22,427 20,306 
Income taxes4,524 4,064 
Current portion of operating lease liabilities4,004 4,208 
Total current liabilities61,624 64,336 
Long-term debt31,856 60,799 
Deferred income taxes3,490 4,212 
Operating lease liabilities22,625 20,043 
Other liabilities14,770 13,053 
Accrued pension and other postretirement costs7,276 7,777 
Total liabilities141,641 170,220 
Commitments and contingencies
Equity:
Common stock1,330 1,325 
Class B convertible common stock103 103 
Treasury stock(17,460)(11,504)
Capital in excess of par value
202,672 201,164 
Retained earnings
182,066 156,359 
Accumulated other comprehensive loss
(38,869)(40,900)
Total Vishay Precision Group, Inc. stockholders' equity
329,842 306,547 
Noncontrolling interests
83 (25)
Total equity
329,925 306,522 
Total liabilities and equity
$471,566 $476,742 

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VISHAY PRECISION GROUP, INC.
Consolidated Statements of Cash Flows
(Unaudited - In thousands)
Years ended
December 31, 2023December 31, 2022
Operating activities
Net earnings$26,010 $36,553 
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization15,550 15,353 
Loss (gain) on disposal of property and equipment75 (117)
Gain on sale of short term investment(14)— 
Reclassification of foreign currency translation adjustment related to disposal of subsidiary 191 
Share-based compensation expense2,290 2,439 
Inventory write-offs for obsolescence2,099 1,650 
Deferred income taxes(156)(2,040)
Foreign currency impacts and other items660 (3,915)
Net changes in operating assets and liabilities, net of acquisition:
Accounts receivable3,794 (4,777)
Inventories(4,898)(11,943)
Prepaid expenses and other current assets4,172 (2,808)
Trade accounts payable(2,658)889 
Other current liabilities56 3,393 
Other non current assets and liabilities, net439 (1,413)
Accrued pension and other postretirement costs, net(1,526)(426)
Net cash provided by operating activities45,893 33,029 
Investing activities
Capital expenditures(15,154)(21,288)
Proceeds from sale of property and equipment40 451 
Purchase of short term investment(1,000)— 
Proceeds from sale of short term investment1,014 — 
Net cash used in investing activities(15,100)(20,837)
Financing activities
Payments on revolving facility(29,000)— 
Purchase of treasury stock(5,915)(2,739)
Distributions to noncontrolling interests(195)(457)
Payments of employee taxes on certain share-based arrangements(825)(435)
Net cash used in financing activities(35,935)(3,631)
Effect of exchange rate changes on cash and cash equivalents545 (4,334)
(Decrease) increase in cash and cash equivalents(4,597)4,227 
Cash and cash equivalents at beginning of year88,562 84,335 
Cash and cash equivalents at end of year$83,965 $88,562 
Supplemental disclosure of investing transactions:
Capital expenditures accrued but not yet paid$2,317 $1,731 
Supplemental disclosure of financing transactions:
Excise tax on net share repurchases accrued but not yet paid$41 $— 




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VISHAY PRECISION GROUP, INC.
Reconciliation of Consolidated Adjusted Gross Profit, Operating Income, Net Earnings Attributable to VPG Stockholders and Diluted Earnings Per Share
(Unaudited - In thousands except per share data)
Gross ProfitOperating IncomeNet Earnings Attributable to VPG StockholdersDiluted Earnings Per share
Fiscal Year Ended December 31, 20232022202320222023202220232022
As reported - GAAP150,342 149,602 41,954 43,799 $25,707 $36,063 $1.88 $2.63 
As reported - GAAP Margins42.3 %41.3 %11.8 %12.1 %
Acquisition purchase accounting adjustments335 1,550 335 1,550 335 1,550 0.02 0.11 
COVID-19 impact 138  138  138 — 0.01 
Start-up costs 150  150  150 — 0.01 
Restructuring costs  1,560 1,518 1,560 1,518 0.11 0.11 
Foreign exchange (gain)/loss    822 (3,579)0.06 (0.26)
Less: Tax effect of reconciling items and discrete tax items    (1,245)(44)(0.10)(0.01)
As Adjusted - Non GAAP$150,677 $151,440 $43,849 $47,155 $29,669 $35,884 $2.17 $2.62 
As Adjusted - Non GAAP Margins42.4 %41.8 %12.4 %13.0 %
Gross ProfitOperating IncomeNet Earnings Attributable to VPG StockholdersDiluted Earnings Per share
Fiscal Quarter Ended December 31, 20232022202320222023202220232022
As reported - GAAP$38,496 $39,698 $12,011 $13,049 $4,227 $8,834 0.31 $0.65 
As reported - GAAP Margins43.0 %41.2 %13.4 %13.6 %
Acquisition purchase accounting adjustments31 240 31 240 31 240  0.02 
Restructuring costs  129 188 129 188 0.01 0.01 
Foreign exchange loss    2,961 1,616 0.21 0.11 
Less: Tax effect of reconciling items and discrete tax items    (887)452 (0.08)0.03 
As Adjusted - Non GAAP$38,527 $39,938 $12,171 $13,477 $8,235 $10,426 $0.61 $0.76 
As Adjusted - Non GAAP Margins43.0 %41.5 %13.6 %14.0 %


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VISHAY PRECISION GROUP, INC.
Reconciliation of Adjusted Gross Profit by segment
(Unaudited - In thousands)
Fiscal quarter ended
December 31, 2023December 31, 2022September 30, 2023
Sensors
As reported - GAAP$13,761 $13,645 $11,681 
As reported - GAAP Margins40.2 %37.6 %35.9 %
As Adjusted - Non GAAP$13,761 $13,645 $11,681 
As Adjusted - Non GAAP Margins40.2 %37.6 %35.9 %
Weighing Solutions
As reported - GAAP$10,834 $11,043 $11,207 
As reported - GAAP Margins35.6 %33.4 %38.7 %
As Adjusted - Non GAAP$10,834 $11,043 $11,207 
As Adjusted - Non GAAP Margins35.6 %33.4 %38.7 %
Measurement Systems
As reported - GAAP$13,906 $15,009 $13,047 
As reported - GAAP Margins56.0 %55.9 %53.6 %
Acquisition purchase accounting adjustments31 240 214 
As Adjusted - Non GAAP$13,937 $15,249 $13,261 
As Adjusted - Non GAAP Margins56.1 %56.8 %54.5 %
























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VISHAY PRECISION GROUP, INC.
Reconciliation of Adjusted EBITDA
(Unaudited - In thousands)
Fiscal quarter ended
December 31, 2023December 31, 2022September 30, 2023
Net earnings attributable to VPG stockholders$4,227 $8,834 $6,280 
Interest Expense779 876 1,119 
Income tax expense4,403 1,884 2,419 
Depreciation2,992 2,882 2,954 
Amortization999 952 880 
EBITDA13,400 $15,428 $13,652 
EBITDA MARGIN15.0 %16.0 %15.9 %
Acquisition purchase accounting adjustments31 240 214 
Restructuring costs129 188 1,153 
Foreign exchange loss/(gain)2,961 1,616 (1,283)
ADJUSTED EBITDA16,521 17,472 13,736 
ADJUSTED EBITDA MARGIN18.5 %18.2 %16.0 %
VISHAY PRECISION GROUP, INC.
Reconciliation of Adjusted EBITDA
(Unaudited - In thousands)
Year ended
December 31, 2023December 31, 2022
Net earnings attributable to VPG stockholders$25,707 $36,063 
Interest Expense3,974 2,269 
Income tax expense12,426 8,535 
Depreciation11,798 11,504 
Amortization3,752 3,849 
EBITDA57,657 $62,220 
EBITDA MARGIN16.2 %17.2 %
Acquisition purchase accounting adjustments335 1,550 
Restructuring costs1,560 1,518 
COVID-19 impact— 138 
Start-up costs— 150 
Foreign exchange (gain) loss822 (3,579)
ADJUSTED EBITDA60,374 61,997 
ADJUSTED EBITDA MARGIN17.0 %17.1 %
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