Vishay Reports Results for Fourth Quarter and Year 2020

Rhea-AI Summary

Vishay Intertechnology reported Q4 revenues of $667 million, with a gross margin of 22.8% and EPS of $0.26, reflecting a recovery from Q3. However, revenues for the full year 2020 were $2,501.9 million, down from $2,668.3 million in 2019. Free cash flow for the year was $192 million. The company projects Q1 2021 revenues between $705 million and $745 million with a gross margin of approximately 25%. Adjusted EPS for Q4 was $0.28, down from $0.92 in 2019, indicating financial challenges amidst the pandemic.

Positive

• Q4 revenues increased quarter-over-quarter to $667 million.
• Operating margin improved to 9.0% in Q4 2020, up from 8.4% in 2019.
• Free cash flow of $192 million generated in 2020.
• Guidance for Q1 2021 indicates potential revenue growth to $705-$745 million.

Negative

• Full year 2020 revenues decreased by $166.4 million compared to 2019.
• EPS dropped significantly to $0.26 in Q4 from $0.85 in 2019.
• Incremental performance affected by higher freight costs and a weaker dollar.

• Revenues Q4 of $667 million; year 2020 of $2,502 million.
• Gross margin Q4 of 22.8%; year 2020 of 23.3%.
• Adjusted gross margin Q4 of 22.9%; year 2020 of 23.4%.
• Operating margin Q4 of 9.0%; year 2020 of 8.4%.
• Adjusted operating margin Q4 of 8.9%; year 2020 of 8.5%.
• EPS Q4 of $0.26; year 2020 of $0.85.
• Adjusted EPS Q4 of $0.28; year 2020 of $0.92.
• Free Cash for the year 2020 of $192 million.
• Guidance Q1 2021 of revenues $705 to $745 million and gross margins of 25.0% plus/minus 60 basis points at the exchange rates of Q4 2020.
  

MALVERN, Pa., Feb. 09, 2021 (GLOBE NEWSWIRE) -- Vishay Intertechnology, Inc. (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive components, today announced its results for the year and fiscal quarter ended December 31, 2020.

Revenues for the year ended December 31, 2020 were $2,501.9 million, compared to $2,668.3 million for the year ended December 31, 2019. Net earnings attributable to Vishay stockholders for the year ended December 31, 2020 were $122.9 million, or $0.85 per diluted share compared to $163.9 million, or $1.13 per diluted share for the year ended December 31, 2019.

Revenues for the fiscal quarter ended December 31, 2020 were $667.2 million, compared to $640.2 million for the fiscal quarter ended October 3, 2020, and $609.6 million for the fiscal quarter ended December 31, 2019. Net earnings attributable to Vishay stockholders for the fiscal quarter ended December 31, 2020 were $37.6 million, or $0.26 per diluted share, compared to $33.5 million, or $0.23 per diluted share for the fiscal quarter ended October 3, 2020, and $14.0 million, or $0.10 per diluted share for the fiscal quarter ended December 31, 2019.

As summarized on the attached reconciliation schedule, all periods presented include items affecting comparability. Adjusted earnings per diluted share, which exclude these items net of tax and the unusual tax items, were $0.28 and $0.92 for the fiscal quarter and year ended December 31, 2020, respectively, $0.25 for the fiscal quarter ended October 3, 2020, and $0.13 and $1.26 for the fiscal quarter and year ended December 31, 2019, respectively.

Commenting on results for the year 2020, Dr. Gerald Paul, President and Chief Executive Officer stated, “The year 2020 has been for Vishay and its business partners overshadowed by the global pandemic. From temporary plant shutdowns in Asia and temporary shortages in the early part of the year, to drastic reactions by automotive customers in the second quarter to a steep and broad recovery of orders since October, Vishay was able to defend efficiencies while minimizing fixed costs and then to quickly ramp back up again. During 2020, Vishay generated free cash flow of $192 million.”

Dr. Paul continued, commenting on the results for the fourth quarter 2020, “Revenues in the fourth quarter have been strong but Vishay’s incremental performance was negatively impacted by a lower than usual contributive margin in the quarter mainly caused by higher freight costs and a weaker dollar versus most currencies. The revenue increase quarter over quarter was driven by higher sales to automotive customers and to distribution. At the same time, inventories of Vishay’s products at distribution were reduced by a further $24 million, increasing again the inventory turns in all regions.”

Commenting on the outlook Dr. Paul stated, “For the first quarter 2021, based on the current order intake and Vishay’s increased 13-week backlog, we guide for revenues in the range of $705 to $745 million at a gross margin of 25.0% plus/minus 60 basis points, assuming the same exchange rates versus the dollar as in the fourth quarter.”

A conference call to discuss Vishay’s fourth quarter and full year financial results is scheduled for Tuesday, February 9, 2021 at 9:00 a.m. ET. The dial-in number for the conference call is 877 589-6174 (+1 706-643-1406, if calling from outside the United States) and the access code is 4219657.

A live audio webcast of the conference call and a PDF copy of the press release and the quarterly presentation will be accessible directly from the Investor Relations section of the Vishay website at http://ir.vishay.com.

There will be a replay of the conference call from 12:00 p.m. ET on Tuesday, February 9, 2021 through 11:59 p.m. ET on Sunday, February 24. The telephone number for the replay is +1 855-859-2056 (+1 404-537-3406, if calling from outside the United States or Canada) and the access code is 4219657.

About Vishay
Vishay manufactures one of the world’s largest portfolios of discrete semiconductors and passive electronic components that are essential to innovative designs in the automotive, industrial, computing, consumer, telecommunications, military, aerospace, and medical markets. Serving customers worldwide, Vishay is The DNA of tech.™ Vishay Intertechnology, Inc. is a Fortune 1,000 Company listed on the NYSE (VSH). More on Vishay at www.Vishay.com.

This press release includes certain financial measures which are not recognized in accordance with U.S. generally accepted accounting principles ("GAAP"), including adjusted net earnings; adjusted earnings per share; adjusted gross margin; adjusted operating margin; free cash; earnings before interest, taxes, depreciation and amortization ("EBITDA"); adjusted EBITDA; and adjusted EBITDA margin; which are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. These non-GAAP measures supplement our GAAP measures of performance or liquidity and should not be viewed as an alternative to GAAP measures of performance or liquidity. Non-GAAP measures such as adjusted net earnings, adjusted earnings per share, adjusted gross margin, adjusted operating margin, free cash, EBITDA, adjusted EBITDA, and adjusted EBITDA margin do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Management believes that such measures are meaningful to investors because they provide insight with respect to intrinsic operating results of the Company. Although the terms "free cash" and "EBITDA" are not defined in GAAP, the measures are derived using various line items measured in accordance with GAAP. Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to understanding the Company's intrinsic operations. Reconciling items to calculate adjusted gross margin, adjusted operating margin and adjusted EBITDA represent those same items used in computing adjusted net earnings, as relevant. Furthermore, the presented calculation of adjusted EBITDA is substantially similar to, but not identical to, a measure used in the calculation of financial ratios required for covenant compliance under Vishay's revolving credit facility. These reconciling items are indicated on the accompanying reconciliation schedules and are more fully described in the Company's financial statements presented in its annual report on Form 10-K and its quarterly reports presented on Forms 10-Q.

Statements contained herein that relate to the Company's future performance, including statements with respect to forecasted revenues, margins, inventories, product demand, anticipated areas of growth, market segment performance, and the performance of the economy in general, are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "project," "intend," "could," "should," or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; manufacturing or supply chain interruptions or changes in customer demand because of COVID-19; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The DNA of tech™ is a trademark of Vishay Intertechnology.

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

VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(In thousands, except per share amounts)
	Years ended
	December 31, 2020				December 31, 2019
	(Unaudited)
Net revenues	$	2,501,898			$	2,668,305
Costs of products sold*		1,919,995				1,997,105
Gross profit		581,903				671,200
Gross margin		23.3	%			25.2	%
Selling, general, and administrative expenses*		371,450				384,631
Restructuring and severance costs		743				24,139
Operating income		209,710				262,430
Operating margin		8.4	%			9.8	%
Other income (expense):
Interest expense		(31,555	)			(33,683	)
Other		(11,754	)			(419	)
Loss on early extinguishment of debt		(8,073	)			(2,030	)
Total other income (expense) - net		(51,382	)			(36,132	)
Income before taxes		158,328				226,298
Income tax expense		34,545				61,508
Net earnings		123,783				164,790
Less: net earnings attributable to noncontrolling interests		860				854
Net earnings attributable to Vishay stockholders	$	122,923			$	163,936
Basic earnings per share attributable to Vishay stockholders	$	0.85			$	1.13
Diluted earnings per share attributable to Vishay stockholders	$	0.85			$	1.13
Weighted average shares outstanding - basic		144,836				144,608
Weighted average shares outstanding - diluted		145,228				145,136
Cash dividends per share	$	0.38			$	0.37
* Includes incremental costs of products sold and selling, general, and administrative expenses (benefits) separable from normal operations directly attributable to the COVID-19 pandemic of $4,563 and $(1,451), respectively.

 

VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands, except per share amounts)
	Fiscal quarters ended
	December 31, 2020				October 3, 2020				December 31, 2019
Net revenues	$	667,180			$	640,160			$	609,577
Costs of products sold*		514,896				488,451				474,216
Gross profit		152,284				151,709				135,361
Gross margin		22.8	%			23.7	%			22.2	%
Selling, general, and administrative expenses**		92,272				90,219				94,299
Restructuring and severance costs		-				-				16,884
Operating income		60,012				61,490				24,178
Operating margin		9.0	%			9.6	%			4.0	%
Other income (expense):
Interest expense		(7,159	)			(7,414	)			(8,523	)
Other		(5,570	)			(4,898	)			(3,652	)
Loss on early extinguishment of debt		(553	)			(3,454	)			(723	)
Total other income (expense) - net		(13,282	)			(15,766	)			(12,898	)
Income before taxes		46,730				45,724				11,280
Income tax expense		8,887				12,063				(2,869	)
Net earnings		37,843				33,661				14,149
Less: net earnings attributable to noncontrolling interests		276				177				187
Net earnings attributable to Vishay stockholders	$	37,567			$	33,484			$	13,962
Basic earnings per share attributable to Vishay stockholders	$	0.26			$	0.23			$	0.10
Diluted earnings per share attributable to Vishay stockholders	$	0.26			$	0.23			$	0.10
Weighted average shares outstanding - basic		144,855				144,854				144,628
Weighted average shares outstanding - diluted		145,251				145,197				145,202
Cash dividends per share	$	0.095			$	0.095			$	0.095
* Includes incremental costs of products sold separable from normal operations directly attributable to the COVID-19 pandemic of $268 and $242 for the fiscal quarters ended December 31, 2020 and October 3, 2020, respectively.
** Includes incremental selling, general, and administrative expenses (benefits) separable from normal operations directly attributable to the COVID-19 pandemic of $(580) and $(441), for the fiscal quarters ended December 31, 2020 and October 3, 2020, respectively.

 

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)
	December 31, 2020				December 31, 2019
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	619,874			$	694,133
Short-term investments		158,476				108,822
Accounts receivable, net		338,632				328,187
Inventories:
Finished goods		120,792				122,466
Work in process		201,259				187,354
Raw materials		126,200				121,860
Total inventories		448,251				431,680
Prepaid expenses and other current assets		132,103				141,294
Total current assets		1,697,336				1,704,116
Property and equipment, at cost:
Land		76,231				75,011
Buildings and improvements		641,041				585,064
Machinery and equipment		2,732,771				2,606,355
Construction in progress		86,520				110,722
Allowance for depreciation		(2,593,398	)			(2,425,627	)
		943,165				951,525
Right of use assets		102,440				93,162
Goodwill		158,183				150,642
Other intangible assets, net		66,795				60,659
Other assets		186,554				160,671
Total assets	$	3,154,473			$	3,120,775

 

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)
	December 31, 2020				December 31, 2019
	(Unaudited)
Liabilities and equity
Current liabilities:
Notes payable to banks	$	-			$	2
Trade accounts payable		196,203				173,915
Payroll and related expenses		141,034				122,100
Lease liabilities		22,074				20,217
Other accrued expenses		182,642				186,463
Income taxes		20,470				17,731
Total current liabilities		562,423				520,428
Long-term debt less current portion		394,886				499,147
U.S. transition tax payable		125,438				140,196
Deferred income taxes		1,852				22,021
Long-term lease liabilities		86,220				78,511
Other liabilities		104,356				100,207
Accrued pension and other postretirement costs		300,113				272,402
Total liabilities		1,575,288				1,632,912
Redeemable convertible debentures		170				174
Equity:
Vishay stockholders' equity
Common stock		13,256				13,235
Class B convertible common stock		1,210				1,210
Capital in excess of par value		1,409,200				1,425,170
Retained earnings		138,990				72,180
Accumulated other comprehensive income (loss)		13,559				(26,646	)
Total Vishay stockholders' equity		1,576,215				1,485,149
Noncontrolling interests		2,800				2,540
Total equity		1,579,015				1,487,689
Total liabilities, temporary equity, and equity	$	3,154,473			$	3,120,775

 

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(In thousands)
	Years ended
	December 31, 2020				December 31, 2019
	(Unaudited)
Operating activities
Net earnings	$	123,783			$	164,790
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization		166,230				164,461
(Gain) loss on disposal of property and equipment		157				(157	)
Accretion of interest on convertible debt instruments		13,161				14,146
Inventory write-offs for obsolescence		22,730				26,494
Pensions and other postretirement benefits, net of contributions		2,864				(552	)
Loss on early extinguishment of debt		8,073				2,030
Deferred income taxes		(12,141	)			(23,009	)
Other		3,304				13,341
Change in U.S. transition tax liability		(14,757	)			(14,757	)
Change in repatriation tax liability		(16,258	)			(38,814	)
Changes in operating assets and liabilities, net of effects of businesses acquired		17,792				(11,529	)
Net cash provided by operating activities		314,938				296,444
Investing activities
Purchase of property and equipment		(123,599	)			(156,641	)
Proceeds from sale of property and equipment		403				577
Purchase of businesses, net of cash acquired		(25,852	)			(11,862	)
Purchase of short-term investments		(293,087	)			(111,631	)
Maturity of short-term investments		250,580				81,012
Other investing activities		(529	)			3,587
Net cash used in investing activities		(192,084	)			(194,958	)
Financing activities
Issuance costs		-				(5,394	)
Repurchase of convertible debt instruments		(151,683	)			(27,863	)
Net changes in short-term borrowings		(114	)			(16	)
Dividends paid to common stockholders		(50,372	)			(48,968	)
Dividends paid to Class B common stockholders		(4,597	)			(4,476	)
Distributions to noncontrolling interests		(600	)			(600	)
Cash withholding taxes paid when shares withheld for vested equity awards		(2,016	)			(2,708	)
Net cash used in financing activities		(209,382	)			(90,025	)
Effect of exchange rate changes on cash and cash equivalents		12,269				(3,360	)
Net increase (decrease) in cash and cash equivalents		(74,259	)			8,101
Cash and cash equivalents at beginning of period		694,133				686,032
Cash and cash equivalents at end of period	$	619,874			$	694,133

 

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Adjusted Earnings Per Share
(Unaudited - In thousands, except per share amounts)
	Fiscal quarters ended												Years ended
	December 31, 2020				October 3, 2020				December 31, 2019				December 31, 2020				December 31, 2019
GAAP net earnings attributable to Vishay stockholders	$	37,567			$	33,484			$	13,962			$	122,923			$	163,936
Reconciling items affecting gross profit:
Impact of the COVID-19 pandemic	$	268			$	242			$	-			$	4,563			$	-
Other reconciling items affecting operating income:
Restructuring and severance costs	$	-			$	-			$	16,884			$	743			$	24,139
Impact of the COVID-19 pandemic		(580	)			(441	)			-				(1,451	)			-
Reconciling items affecting other income (expense):
Loss on early extinguishment of debt	$	553			$	3,454			$	723			$	8,073			$	2,030
Reconciling items affecting tax expense (benefit):
Change in deferred taxes due to early extinguishment of debt	$	(217	)		$	-			$	(289	)		$	(1,563	)		$	(1,601	)
Effects of cash repatriation program		-				-				(11,554	)			(190	)			(9,583	)
Effects of changes in uncertain tax positions		3,751				-				2,831				3,751				2,831
Effects of tax-basis foreign exchange gain		-				-				-				-				7,554
Tax effects of pre-tax items above		(12	)			(716	)			(4,277	)			(2,799	)			(6,211	)
Adjusted net earnings	$	41,330			$	36,023			$	18,280			$	134,050			$	183,095
Adjusted weighted average diluted shares outstanding		145,251				145,197				145,202				145,228				145,136
Adjusted earnings per diluted share	$	0.28			$	0.25			$	0.13			$	0.92			$	1.26

 

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Free Cash
(Unaudited - In thousands)
	Fiscal quarters ended												Years ended
	December 31, 2020				October 3, 2020				December 31, 2019				December 31, 2020				December 31, 2019
Net cash provided by operating activities	$	125,699			$	64,330			$	84,423			$	314,938			$	296,444
Proceeds from sale of property and equipment		110				63				91				403				577
Less: Capital expenditures		(52,798	)			(21,969	)			(56,374	)			(123,599	)			(156,641	)
Free cash	$	73,011			$	42,424			$	28,140			$	191,742			$	140,380

 

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of EBITDA and Adjusted EBITDA
(Unaudited - In thousands)
	Fiscal quarters ended												Years ended
	December 31, 2020				October 3, 2020				December 31, 2019				December 31, 2020				December 31, 2019
GAAP net earnings attributable to Vishay stockholders	$	37,567			$	33,484			$	13,962			$	122,923			$	163,936
Net earnings attributable to noncontrolling interests		276				177				187				860				854
Net earnings	$	37,843			$	33,661			$	14,149			$	123,783			$	164,790
Interest expense	$	7,159			$	7,414			$	8,523			$	31,555			$	33,683
Interest income		(385	)			(514	)			(1,734	)			(3,709	)			(8,445	)
Income taxes		8,887				12,063				(2,869	)			34,545				61,508
Depreciation and amortization		42,454				41,618				42,159				166,230				164,461
EBITDA	$	95,958			$	94,242			$	60,228			$	352,404			$	415,997
Reconciling items
Impact of the COVID-19 pandemic	$	(312	)		$	(199	)		$	-			$	3,112			$	-
Restructuring and severance costs		-				-				16,884				743				24,139
Loss on early extinguishment of debt		553				3,454				723				8,073				2,030
Adjusted EBITDA	$	96,199			$	97,497			$	77,835			$	364,332			$	442,166
Adjusted EBITDA margin**		14.4	%			15.2	%			12.8	%			14.6	%			16.6	%
** Adjusted EBITDA as a percentage of net revenues

 

FAQ

What were Vishay's Q4 2020 revenues?

Vishay reported Q4 2020 revenues of $667 million.

How did Vishay's full year 2020 revenues compare to 2019?

Full year 2020 revenues were $2,501.9 million, down from $2,668.3 million in 2019.

What is the EPS for Vishay in Q4 2020?

The EPS for Vishay in Q4 2020 was $0.26.

What is Vishay's guidance for Q1 2021 revenues?

Vishay's Q1 2021 revenue guidance is between $705 million and $745 million.

What were Vishay's gross margins in Q4 2020?

Vishay's gross margin for Q4 2020 was 22.8%.