GlobeNewswire Inc | Nov 3, 2020 07:00AM EST

November 03, 2020

-- Revenues Q3 of $640 million -- Gross margin Q3 of 23.7%; adjusted gross margin 23.7% -- Operating margin Q3 of 9.6%; adjusted operating margin 9.6% -- EPS Q3 of $0.23; adjusted EPS $0.25 -- Free Cash for the trailing 12 months Q3 of $147 million -- Repurchased in Q3 $58.9 million principal amount of convertible notes due 2025; YTD repurchased $134.7 million principal amount for approximately 95% of face value -- Acquired the worldwide business and substantially all of the U.S. assets of Applied Thin-Film Products, a California-based manufacturer of custom, build-to-print thin film substrates for $25.9 million -- Guidance Q4 of revenues $620 to $660 million and gross margins of 23.9% plus/minus 70 basis points at a EUR/USD exchange rate of 0.86

MALVERN, Pa., Nov. 03, 2020 (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 fiscal quarter and nine fiscal months ended October 3, 2020.

Revenues for the fiscal quarter ended October 3, 2020 were $640.2 million, compared to $581.7 million for the fiscal quarter ended July 4, 2020, and $628.3 million for the fiscal quarter ended September 28, 2019. Net earnings attributable to Vishay stockholders for the fiscal quarter ended October 3, 2020 were $33.5 million, or $0.23 per diluted share, compared to $24.7 million, or $0.17 per diluted share for the fiscal quarter ended July 4, 2020, and $30.0 million, or $0.21 per diluted share for the fiscal quarter ended September 28, 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 $0.25, $0.18, and $0.26 for the fiscal quarters ended October 3, 2020, July 4, 2020, and September 28, 2019, respectively.

Commenting on results for the third quarter 2020, Dr. Gerald Paul, President and Chief Executive Officer stated, Following an historically unprecedented drop of sales to automotive customers in the second quarter, Vishay experienced a stronger than anticipated rebound of sales to automotive customers in the third quarter, as well as continued strength from Asian markets. Inventories of Vishay products at distribution were reduced by $18 million driven by high demand for consumer related products.

Dr. Paul continued, The expected recovery in the third quarter occurred more steeply than anticipated. Having reacted promptly by reducing fixed costs, Vishay is now ready to exploit the next upturn to the full extent. Our focus stays on profitability and cash generation while pursuing our long-term strategies as well as, especially during COVID-19, safeguarding the health and well-being of our employees.

Commenting on the outlook Dr. Paul stated, For the fourth quarter 2020 we guide for revenues in the range of $620 to $660 million at a gross margin of 23.9% plus/minus 70 basis points, assuming a EUR/USD exchange rate of 0.86.

A conference call to discuss Vishays third quarter financial results is scheduled for Tuesday, November 3, 2020 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 7991697.

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, November 3, 2020 through 11:59 p.m. ET on Wednesday, November 18. 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 7991697.

AboutVishayVishay manufactures one of the worlds 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 TheDNAoftech. 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 moreof 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 DNAoftech is a trademark of Vishay Intertechnology.

Contact:

Vishay Intertechnology, Inc.Peter HenriciSenior Vice President, Corporate Communications+1-610-644-1300

VISHAY INTERTECHNOLOGY, INC.Summary of Operations(Unaudited - In thousands, except per share amounts)

Fiscal quarters ended October 3, July 4, 2020 September 28, 2020 2019Net revenues $ 640,160 $ 581,717 $ 628,329 Costs of products sold* 488,451 451,047 478,250 Gross profit 151,709 130,670 150,079 Gross margin 23.7 % 22.5 % 23.9 %Selling, general, and 90,219 89,127 91,796 administrative expenses**Restructuring and severance - 743 7,255 costsOperating income 61,490 40,800 51,028 Operating margin 9.6 % 7.0 % 8.1 %Other income (expense): Interest expense (7,414 ) (8,430 ) (8,564 )Other (4,898 ) (1,484 ) 1,718 Loss on early extinguishment of (3,454 ) (1,146 ) - debtTotal other income (expense) - (15,766 ) (11,060 ) (6,846 )netIncome before taxes 45,724 29,740 44,182 Income tax expense 12,063 4,845 13,917 Net earnings 33,661 24,895 30,265 Less: net earnings attributable 177 242 227 to noncontrolling interestsNet earnings attributable to $ 33,484 $ 24,653 $ 30,038 Vishay stockholdersBasic earnings per shareattributable to Vishay $ 0.23 $ 0.17 $ 0.21 stockholdersDiluted earnings per shareattributable to Vishay $ 0.23 $ 0.17 $ 0.21 stockholdersWeighted average shares 144,854 144,846 144,628 outstanding - basicWeighted average shares 145,197 145,170 145,027 outstanding - dilutedCash 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 outbreak of $242 and $923 for the fiscal quarters ended October 3, 2020 and July 4, 2020, respectively.** Includes incremental selling, general, and administrative expenses (benefits) separable from normal operations directly attributable to the COVID-19 outbreak of $(441) and $(747), for the fiscal quarters ended October 3, 2020 and July 4, 2020, respectively.

VISHAY INTERTECHNOLOGY, INC.Summary of Operations(Unaudited - In thousands, except per share amounts) Nine fiscal months ended October 3, 2020 September 28, 2019 Net revenues $ 1,834,718 $ 2,058,728 Costs of products sold* 1,405,099 1,522,889 Gross profit 429,619 535,839 Gross margin 23.4 % 26.0 %Selling, general, and administrative 279,178 290,332 expenses*Restructuring and severance costs 743 7,255 Operating income 149,698 238,252 Operating margin 8.2 % 11.6 %Other income (expense): Interest expense (24,396 ) (25,160 )Other (6,184 ) 3,233 Loss on early extinguishment of debt (7,520 ) (1,307 )Total other income (expense) - net (38,100 ) (23,234 )Income before taxes 111,598 215,018 Income tax expense 25,658 64,377 Net earnings 85,940 150,641 Less: net earnings attributable to 584 667 noncontrolling interestsNet earnings attributable to Vishay $ 85,356 $ 149,974 stockholdersBasic earnings per share attributable to $ 0.59 $ 1.04 Vishay stockholdersDiluted earnings per share attributable to $ 0.59 $ 1.03 Vishay stockholdersWeighted average shares outstanding - basic 144,831 144,602 Weighted average shares outstanding - 145,221 145,114 dilutedCash dividends per share $ 0.285 $ 0.275

* Includes incremental costs of products sold and selling, general, and administrative expenses (benefits) separable from normal operations directly attributable to the COVID-19 outbreak of $4,295 and $(871), respectively.

VISHAY INTERTECHNOLOGY, INC.Consolidated Condensed Balance Sheets(In thousands)

October 3, 2020 December 31, 2019 (Unaudited) Assets Current assets: Cash and cash equivalents $ 682,422 $ 694,133 Short-term investments 29,538 108,822 Accounts receivable, net 342,691 328,187 Inventories: Finished goods 119,221 122,466 Work in process 197,806 187,354 Raw materials 123,176 121,860 Total inventories 440,203 431,680 Prepaid expenses and other current assets 120,490 141,294 Total current assets 1,615,344 1,704,116 Property and equipment, at cost: Land 75,335 75,011 Buildings and improvements 619,228 585,064 Machinery and equipment 2,678,629 2,606,355 Construction in progress 78,059 110,722 Allowance for depreciation (2,534,027 ) (2,425,627 ) 917,224 951,525 Right of use assets 103,235 93,162 Goodwill 157,406 150,642 Other intangible assets, net 67,839 60,659 Other assets 172,785 160,671 Total assets $ 3,033,833 $ 3,120,775

VISHAY INTERTECHNOLOGY, INC.Consolidated Condensed Balance Sheets (continued)(In thousands) October 3, 2020 December 31, 2019 (Unaudited) Liabilities and equity Current liabilities: Notes payable to banks $ 4 $ 2 Trade accounts payable 159,016 173,915 Payroll and related expenses 130,252 122,100 Lease liabilities 21,924 20,217 Other accrued expenses 169,379 186,463 Income taxes 22,699 17,731 Total current liabilities 503,274 520,428 Long-term debt less current portion 392,290 499,147 U.S. transition tax payable 125,438 140,196 Deferred income taxes 8,670 22,021 Long-term lease liabilities 86,043 78,511 Other liabilities 101,191 100,207 Accrued pension and other postretirement 277,758 272,402 costsTotal liabilities 1,494,664 1,632,912 Redeemable convertible debentures - 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 1,410,335 1,425,170 Retained earnings 115,184 72,180 Accumulated other comprehensive income (3,340 ) (26,646 )(loss)Total Vishay stockholders' equity 1,536,645 1,485,149 Noncontrolling interests 2,524 2,540 Total equity 1,539,169 1,487,689 Total liabilities, temporary equity, and $ 3,033,833 $ 3,120,775 equity

VISHAY INTERTECHNOLOGY, INC.Consolidated Condensed Statements of Cash Flows(Unaudited ?In thousands) Nine fiscal months ended October 3, September 2020 28, 2019 Operating activities Net earnings $ 85,940 $ 150,641 Adjustments to reconcile net earnings tonet cash provided by operating activities:Depreciation and amortization 123,776 122,302 (Gain) loss on disposal of property and equipment 257 (168 )Accretion of interest on convertible debt 10,232 10,558 instrumentsInventory write-offs for obsolescence 17,891 19,214 Loss on early extinguishment of debt 7,520 1,307 Deferred income taxes (1,142 ) (4,481 )Other 3,188 9,029 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 (27,408 ) (42,810 )effects of businesses acquiredNet cash provided by operating activities 189,239 212,021 Investing activities Purchase of property and equipment (70,801 ) (100,267 )Proceeds from sale of property and equipment 293 486 Purchase of businesses, net of cash acquired (25,852 ) (11,862 )Purchase of short-term investments (157,177 ) (59,440 )Maturity of short-term investments 241,016 79,765 Other investing activities (529 ) 4,021 Net cash used in investing activities (13,050 ) (87,297 ) Financing activities Issuance costs - (5,394 )Repurchase of convertible debt instruments (148,177 ) (22,695 )Net changes in short-term borrowings (110 ) (12 )Dividends paid to common stockholders (37,779 ) (36,396 )Dividends paid to Class B common stockholders (3,448 ) (3,327 )Distributions to noncontrolling interests (600 ) (600 )Cash withholding taxes paid when shares withheld (2,016 ) (2,708 )for vested equity awardsNet cash used in financing activities (192,130 ) (71,132 )Effect of exchange rate changes on cash and cash 4,230 (8,141 )equivalents Net increase (decrease) in cash and cash (11,711 ) 45,451 equivalentsCash and cash equivalents at beginning of period 694,133 686,032 Cash and cash equivalents at end of period $ 682,422 $ 731,483

VISHAY INTERTECHNOLOGY, INC.Reconciliation of Adjusted Earnings Per Share(Unaudited - In thousands, except per share amounts) Fiscal quarters ended Nine fiscal months ended October 3, July 4, September 28, October 3, September 28, 2020 2020 2019 2020 2019 GAAP netearningsattributable $ 33,484 $ 24,653 $ 30,038 $ 85,356 $ 149,974 to Vishaystockholders Reconcilingitems affectinggross profit:Impact of theCOVID-19 $ 242 $ 923 $ - $ 4,295 $ - outbreak Otherreconcilingitems affectingoperatingincome:Restructuringand severance $ - $ 743 $ 7,255 $ 743 $ 7,255 costsImpact of theCOVID-19 (441 ) (747 ) - (871 ) - outbreak Reconcilingitemsaffecting other income(expense):Loss on earlyextinguishment $ 3,454 $ 1,146 $ - $ 7,520 $ 1,307 of debt Reconcilingitemsaffecting tax expense(benefit):Change indeferred taxesdue to early $ - $ - $ - $ (1,346 ) $ (1,312 )extinguishmentof debtEffects oftax-basis - - - - 7,554 foreignexchange gainEffects ofcash - (190 ) 2,604 (190 ) 1,971 repatriationprogramTax effects ofpre-tax items (716 ) (589 ) (1,644 ) (2,787 ) (1,934 )above Adjusted net $ 36,023 $ 25,939 $ 38,253 $ 92,720 $ 164,815 earnings Adjustedweightedaverage 145,197 145,170 145,027 145,221 145,114 diluted sharesoutstanding Adjustedearnings per $ 0.25 $ 0.18 $ 0.26 $ 0.64 $ 1.14 diluted share

VISHAY INTERTECHNOLOGY, INC.Reconciliation of Free Cash(Unaudited - In thousands) Fiscal quarters ended Nine fiscal months ended October 3, July 4, September 28, October 3, September 28, 2020 2020 2019 2020 2019Net cashprovided by $ 64,330 $ 90,431 76,202 $ 189,239 $ 212,021 operatingactivitiesProceedsfrom sale of 63 177 22 293 486 property andequipmentLess:Capital (21,969 ) (24,504 ) (30,119 ) (70,801 ) (100,267 )expendituresFree cash $ 42,424 $ 66,104 $ 46,105 $ 118,731 $ 112,240

VISHAY INTERTECHNOLOGY, INC.Reconciliation of EBITDA and Adjusted EBITDA(Unaudited - In thousands) Fiscal quarters ended Nine fiscalmonths ended October 3, July 4, September October 3, September 28, 2020 2020 28, 2020 2019 2019 GAAP netearningsattributable $ 33,484 $ 24,653 $ 30,038 $ 85,356 $ 149,974 to VishaystockholdersNet earningsattributableto 177 242 227 584 667 noncontrollinginterestsNet earnings $ 33,661 $ 24,895 $ 30,265 $ 85,940 $ 150,641 Interest $ 7,414 $ 8,430 $ 8,564 $ 24,396 $ 25,160 expenseInterest (514 ) (956 ) (2,365 ) (3,324 ) (6,711 )incomeIncome taxes 12,063 4,845 13,917 25,658 64,377 Depreciationand 41,618 40,638 40,956 123,776 122,302 amortizationEBITDA $ 94,242 $ 77,852 $ 91,337 $ 256,446 $ 355,769 Reconciling itemsImpact of theCOVID-19 $ (199 ) $ 176 $ - $ 3,424 $ - outbreakRestructuringand severance - 743 7,255 743 7,255 costsLoss on earlyextinguishment 3,454 1,146 - 7,520 1,307 of debt Adjusted $ 97,497 $ 79,917 $ 98,592 $ 268,133 $ 364,331 EBITDA AdjustedEBITDA 15.2 % 13.7 % 15.7 % 14.6 % 17.7 %margin** ** Adjusted EBITDA as a percentage of net revenues