Vishay Intertechnology Reports First Quarter 2023 Results

Vishay Intertechnology, Inc.

MALVERN, Pa., May 10, 2023 (GLOBE NEWSWIRE) -- Vishay Intertechnology, Inc., (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive electronic components, today announced results for the fiscal first quarter ended April 1, 2023.

Highlights

• 1Q 2023 revenues of $871.0 million

• 1Q 2023 EPS of $0.79

• 1Q 2023 book-to-bill of 0.84

• Backlog at quarter end was 7.5 months

• YTD 2023 total stockholder return of $34.2 million

• Extension of $750 million revolving credit facility to May 2028

“Driven by sales increases in medical and aerospace/defense along with continued strong demand in automotive, for the first quarter we delivered revenue growth of 2.0% year over year and 1.8% quarter over quarter. We also increased investments in capacity expansion for our 30 key product lines in support of high growth and high return opportunities that meet our customers’ accelerating demand. While 2023 is a staging year at Vishay as we prepare to participate fully in the next step up in demand related to connectivity, mobility and sustainability megatrends, we remain committed to spending approximately $385 million in capex and returning at least $100 million to our stockholders,” said Joel Smejkal, president and CEO.

2Q 2023 Outlook
For the second quarter of 2023, management expects revenues in the range of $860 million and $900 million and a gross profit margin in the range of 29.0% +/- 50 basis points.

Conference Call
Management will host a conference call today, May 10, 2023, at 9:00 a.m. ET to discuss first quarter 2023 results. The dial-in number for the conference call is 877-407-0989 (+1 201-389-0921, if calling from outside the United States) and the access code is 13737582. Interested parties may also access a real-time webcast through the Investor Relations section of the company’s website at http://ir.vishay.com. A presentation accompanying management’s prepared remarks will be posted approximately 30 minutes before the conference call starts. For interested parties who are unable to join the live call, there will be a replay of the conference call from 12:00 p.m. ET on Wednesday, May 10, 2023, through 11:59 p.m. ET on Wednesday, May 24, 2023. The telephone number for the replay is +1 877-660-6853 (+1 201-612-7415, if calling from outside the United States or Canada) and the access code is 13737582.

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 forecasted revenues and margins, capital investment, capacity expansion, stockholder returns, 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 and expressions such as “guide,” “will,” “expect,” “anticipate,” “committed” 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 or otherwise; 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
Executive Vice President, Corporate Development
+1-610-644-1300

VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands, except per share amounts)
	Fiscal quarters ended
	April 1, 2023				December 31, 2022				April 2, 2022
Net revenues	$	871,046			$	855,298			$	853,793
Costs of products sold		592,333				606,178				594,685
Gross profit		278,713				249,120				259,108
Gross margin		32.0%				29.1%				30.3%
Selling, general, and administrative expenses		120,145				113,812				112,855
Operating income		158,568				135,308				146,253
Operating margin		18.2%				15.8%				17.1%
Other income (expense):
Interest expense		(5,120	)			(4,490	)			(4,222	)
Other		3,329				(2,618	)			(5,751	)
Total other income (expense) - net		(1,791	)			(7,108	)			(9,973	)
Income before taxes		156,777				128,200				136,280
Income tax expense		44,588				54,999				32,330
Net earnings		112,189				73,201				103,950
Less: net earnings attributable to noncontrolling interests		408				413				377
Net earnings attributable to Vishay stockholders	$	111,781			$	72,788			$	103,573
Basic earnings per share attributable to Vishay stockholders	$	0.79			$	0.51			$	0.71
Diluted earnings per share attributable to Vishay stockholders	$	0.79			$	0.51			$	0.71
Weighted average shares outstanding - basic		140,636				141,643				145,053
Weighted average shares outstanding - diluted		141,251				142,247				145,553
Cash dividends per share	$	0.10			$	0.10			$	0.10

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)
	April 1, 2023				December 31, 2022
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	847,534			$	610,825
Short-term investments		186,892				305,272
Accounts receivable, net		444,021				416,178
Inventories:
Finished goods		171,404				156,234
Work in process		282,166				261,345
Raw materials		203,111				201,300
Total inventories		656,681				618,879
Prepaid expenses and other current assets		170,767				170,056
Total current assets		2,305,895				2,121,210
Property and equipment, at cost:
Land		76,269				75,907
Buildings and improvements		676,678				658,829
Machinery and equipment		2,910,769				2,857,636
Construction in progress		234,481				243,038
Allowance for depreciation		(2,755,509	)			(2,704,951	)
		1,142,688				1,130,459
Right of use assets		130,306				131,193
Deferred income taxes		106,197				104,667
Goodwill		201,657				201,432
Other intangible assets, net		75,965				77,896
Other assets		99,960				98,796
Total assets	$	4,062,668			$	3,865,653

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)
	April 1, 2023				December 31, 2022
	(Unaudited)
Liabilities and equity
Current liabilities:
Trade accounts payable	$	219,802			$	189,099
Payroll and related expenses		159,708				166,079
Lease liabilities		25,908				25,319
Other accrued expenses		246,529				261,606
Income taxes		97,307				84,155
Total current liabilities		749,254				726,258
Long-term debt less current portion		566,755				500,937
U.S. transition tax payable		83,010				83,010
Deferred income taxes		125,289				117,183
Long-term lease liabilities		107,221				108,493
Other liabilities		94,216				92,530
Accrued pension and other postretirement costs		189,606				187,092
Total liabilities		1,915,351				1,815,503
Equity:
Vishay stockholders' equity
Common stock		13,316				13,291
Class B convertible common stock		1,210				1,210
Capital in excess of par value		1,351,622				1,352,321
Retained earnings		870,975				773,228
Treasury stock (at cost)		(103,145	)			(82,972	)
Accumulated other comprehensive income (loss)		9,032				(10,827	)
Total Vishay stockholders' equity		2,143,010				2,046,251
Noncontrolling interests		4,307				3,899
Total equity		2,147,317				2,050,150
Total liabilities and equity	$	4,062,668			$	3,865,653

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(Unaudited - In thousands)
	Three fiscal months ended
	April 1, 2023				April 2, 2022
Operating activities
Net earnings	$	112,189			$	103,950
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		43,301				40,650
(Gain) loss on disposal of property and equipment		(64	)			(59	)
Inventory write-offs for obsolescence		8,986				5,825
Deferred income taxes		7,329				2,347
Other		269				8,816
Changes in operating assets and liabilities		(42,117	)			(127,944	)
Net cash provided by operating activities		129,893				33,585
Investing activities
Purchase of property and equipment		(45,574	)			(35,909	)
Proceeds from sale of property and equipment		326				72
Purchase of short-term investments		(41	)			(7,753	)
Maturity of short-term investments		121,768				56,674
Other investing activities		(892	)			(199	)
Net cash provided by investing activities		75,587				12,885
Financing activities
Net proceeds (payments) on revolving credit lines		65,000				-
Dividends paid to common stockholders		(12,810	)			(13,259	)
Dividends paid to Class B common stockholders		(1,210	)			(1,210	)
Repurchase of common stock held in treasury		(20,173	)			(9,873	)
Cash withholding taxes paid when shares withheld for vested equity awards		(3,653	)			(2,123	)
Net cash provided by (used in) financing activities		27,154				(26,465	)
Effect of exchange rate changes on cash and cash equivalents		4,075				(4,865	)
Net increase in cash and cash equivalents		236,709				15,140
Cash and cash equivalents at beginning of period		610,825				774,108
Cash and cash equivalents at end of period	$	847,534			$	789,248

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Adjusted Earnings Per Share
(Unaudited - In thousands, except per share amounts)
	Fiscal quarters ended
	April 1, 2023			December 31, 2022				April 2, 2022
GAAP net earnings attributable to Vishay stockholders	$	111,781		$	72,788			$	103,573
Reconciling items affecting tax expense (benefit):
Effect of change in indefinite reversal assertion	$	-		$	59,642			$	-
Effects of changes in valuation allowances		-			(33,669	)			-
Adjusted net earnings	$	111,781		$	98,761			$	103,573
Adjusted weighted average diluted shares outstanding		141,251			142,247				145,553
Adjusted earnings per diluted share	$	0.79		$	0.69			$	0.71

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Free Cash
(Unaudited - In thousands)
	Fiscal quarters ended
	April 1, 2023				December 31, 2022				April 2, 2022
Net cash provided by operating activities	$	129,893			$	166,496			$	33,585
Proceeds from sale of property and equipment		326				726				72
Less: Capital expenditures		(45,574	)			(153,133	)			(35,909	)
Free cash	$	84,645			$	14,089			$	(2,252	)

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of EBITDA and Adjusted EBITDA
(Unaudited - In thousands)
	Fiscal quarters ended
	April 1, 2023				December 31, 2022				April 2, 2022
GAAP net earnings attributable to Vishay stockholders	$	111,781			$	72,788			$	103,573
Net earnings attributable to noncontrolling interests		408				413				377
Net earnings	$	112,189			$	73,201			$	103,950
Interest expense	$	5,120			$	4,490			$	4,222
Interest income		(5,944	)			(4,374	)			(561	)
Income taxes		44,588				54,999				32,330
Depreciation and amortization		43,301				42,690				40,650
EBITDA	$	199,254			$	171,006			$	180,591
Reconciling items	$	-			$	-			$	-
Adjusted EBITDA	$	199,254			$	171,006			$	180,591
Adjusted EBITDA margin**		22.9	%			20.0	%			21.2	%
** Adjusted EBITDA as a percentage of net revenues