================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) November 4, 2005
VISHAY INTERTECHNOLOGY, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-7416 38-1686453
- ---------------------------- ------------ -------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
63 Lincoln Highway
Malvern, PA 19355 19355-2143
---------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 610-644-1300
--------------------------------------------------------------
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
================================================================================
ITEM 2.02 - RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On November 4, 2005, Vishay Intertechnology, Inc. issued a press release
announcing its financial results for the third quarter and nine fiscal months
ended October 1, 2005. A copy of the press release is furnished as Exhibit 99 to
this report.
ITEM 9.01 - FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
Exhibit No. Description
- ----------- ------------------------------------
99 Press release dated November 4, 2005
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: November 4, 2005
VISHAY INTERTECHNOLOGY, INC.
By: /s/ Richard N. Grubb
----------------------------
Name: Richard N. Grubb
Title: Executive Vice President and
Chief Financial Officer
Exhibit 99
VISHAY REPORTS RESULTS FOR THIRD QUARTER 2005
-- Looking back at good third quarter and expecting an even better fourth
quarter 2005
-- Book-to-bill ratio 1.07 for third quarter
-- Net earnings of $0.11 per diluted share for the third quarter 2005
have been negatively affected by the after-tax impact of certain items
(enumerated below) of $0.03 per share, as compared to second quarter
2005 net earnings of $0.05 per diluted share, which had been
negatively affected by the after-tax impact of certain items of $0.07
per share
-- Effective tax rate improvement
-- Cash generated from operations for the quarter was $65 million
MALVERN, Pa., Nov. 4 /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 revenues for the
fiscal quarter ended October 1, 2005 were $566,077,000 compared to revenues of
$584,320,000 for the third quarter of 2004, a 3.1% decrease, and $582,388,000
for the second quarter of 2005, a 2.8% decrease. Net earnings for the quarter
ended October 1, 2005 were $19,956,000 or $0.11 per diluted share, compared with
net earnings for the quarter ended October 2, 2004 of $22,070,000 or $0.13 per
diluted share and net earnings for the quarter ended July 2, 2005 of $9,716,000
or $0.05 per diluted share.
Net earnings of $19,956,000 or $0.11 per diluted share for the third
quarter of 2005 were impacted by restructuring and severance costs of $3,924,000
and related asset write-downs of $4,682,000, partially offset by gains resulting
from adjustments to previously existing purchase commitments of $1,146,000.
These items and their tax-related consequences had a negative $0.03 effect on
earnings per share. Net earnings for the third quarter of 2004 were impacted by
restructuring and severance costs of $4,997,000 and by charges for purchased
in-process research and development of $1,500,000, partially offset by a
favorable settlement of a note receivable of $3,100,000. These items and their
tax-related consequences had a negative $0.01 effect on earnings per share for
the third quarter of 2004.
Revenues for the nine fiscal months ended October 1, 2005 were
$1,702,831,000, a 9.0% decrease as compared to revenues of $1,871,940,000 for
the comparable prior year period. Net earnings for the nine fiscal months ended
October 1, 2005 were $35,384,000 or $0.20 per diluted share compared to net
earnings of $99,154,000 or $0.55 per diluted share for the comparable prior year
period. Net earnings for the nine fiscal months ended October 1, 2005 were
impacted by restructuring and severance costs of $18,178,000, by related asset
write-downs of $4,813,000, by charges for purchased in-process research and
development of $9,201,000, by Siliconix transaction-related expenses of
$3,751,000, and by losses resulting from adjustments to previously existing
purchase commitments of $2,454,000, partially offset by a gain on sale of land
of $2,120,000. In addition, tax expense includes a $3,698,000 favorable benefit,
primarily due to a foreign tax ruling. These items and their tax-related
consequences had a negative $0.13 effect on earnings per share. Net earnings for
the nine fiscal months ended October 2, 2004 were impacted by restructuring and
severance costs of $7,057,000, and by charges for purchased in-process research
and development of $1,500,000, partially offset by a favorable settlement of a
note receivable of $3,100,000. These items and their tax-related consequences
had a negative $0.02 effect on earnings per share for the nine fiscal months
ended October 2, 2004.
Commenting on the results for the third quarter of 2005, Dr. Paul stated,
"We are looking back at a good third quarter. While sales were slightly lower
sequentially - in line with our expectation and guidance - we are reporting
higher margins. We achieved this through our program to reduce fixed costs by
$50 million in 2005, which contributed a $13 million reduction compared to last
year but also through our continuous reduction of variable costs, which
contributed $10 million."
Commenting on the outlook for the fourth quarter 2005, Dr. Paul continued,
"Based on a book-to-bill of 1.07 in the third quarter and a solid backlog, we
guide for sales in the range of $570 million to $590 million. We expect gross
margins to be higher than in the third quarter due to better volume and
continued cost reduction."
Commenting on the Company's Research and Development activities, Dr. Felix
Zandman, Chairman of the Board and Chief Technical and Business Development
Officer, stated, "We are starting to reap the benefits of our strong focus on
Research and Development across the Company. For example, our new series of
high-current Schottky diodes in Trench technology represents a technological
breakthrough: they have the ability to handle double the power in the same
package size compared to the industry standard. The recent introduction into the
market was very successful and we expect this product to ramp fast in 2006. An
example for a breakthrough technology launched two years ago is our MICRO FOOT
(R) chip scale technology. The two new product families of this technology,
MICRO FOOT MOSFETs and MICRO FOOT analog switches, are forecasted to sell this
year already at a rate of $25 million. Both product lines are designed in with
most high-end cell phones and demand is growing fast. We are in the process to
ramp capacity as fast as possible to meet the need of the market."
A conference call to discuss third quarter financial results is scheduled
for Friday, November 4, 2005 at 11:00 AM (EST). The dial-in number for the
conference call is 800-611-1148 (612-332-0636 if calling from outside the United
States or Canada). The conference operator will require the following
information in order to admit you into the call: Company Name: Vishay
Intertechnology, Inc. and Moderators: Vishay Executives.
There will be a replay of the conference call from 2:30 PM (EST) on Friday,
November 4, 2005 through 11:59 PM (EST) on Wednesday, November 9, 2005. The
telephone number for the replay is 800-475-6701 (320-365-3844 if calling from
outside the United States or Canada). The access code is 799471.
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.
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, and
transducers). Vishay's components can be found in products manufactured in a
very broad range of industries worldwide. Vishay is headquartered in Malvern,
Pa., and has operations in 17 countries employing more than 25,000 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 and
bookings and the anticipated future benefits of the Company's product,
acquisition 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, 2004 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, and other
items is meaningful to investors because it provides insight with respect to
intrinsic operating results of the Company.
VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands except earnings per share)
Fiscal quarter ended
-------------------------
October 1, October 2,
2005 2004
---------- ----------
Net revenues* $ 566,077 $ 584,320
Cost of products sold 431,430 443,342
Gain on purchase commitments (1,146) -
Gross profit 135,793 140,978
24.0% 24.1%
Selling, general, and administrative expenses 94,174 95,879
Purchased in-process research and development - 1,500
Restructuring and severance costs 3,924 4,997
Asset write-downs 4,682 -
Operating income 33,013 38,602
5.8% 6.6%
Other income (expense):
Interest expense (8,170) (8,224)
Minority interest (154) (3,268)
Other 3,442 4,415
(4,882) (7,077)
Earnings before taxes 28,131 31,525
Income taxes 8,175 9,455
Net earnings $ 19,956 $ 22,070
Basic earnings per share $ 0.11 $ 0.13
Diluted earnings per share $ 0.11 $ 0.13
Weighted average shares outstanding - basic 184,114 166,090
Weighted average shares outstanding - diluted 195,719 182,800
* As a result of a concentrated effort to defend its intellectual property
and generate additional licensing income, Vishay began receiving royalties in
the fourth quarter of 2004. The Company expects royalty revenues to increase and
continues to seek to expand its royalty streams. The Company previously
classified royalties as other income. Beginning with the third quarter of 2005,
royalties are now classified as revenue. Previous periods have been reclassified
to conform to the current financial statement presentation. Royalty revenues
during the third quarter of 2005 and the nine fiscal months ended October 1,
2005 were $1,564,000 and $3,002,000, respectively. There were no royalty
revenues for the comparable prior year periods.
VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited - In thousands except earnings per share)
Nine fiscal months ended
-------------------------
October 1, October 2,
2005 2004
---------- ----------
Net revenues* $1,702,831 $1,871,940
Costs of products sold 1,315,718 1,402,327
Loss on purchase commitments 2,454 -
Gross profit 384,659 469,613
22.6% 25.1%
Selling, general, and administrative expenses 286,352 292,570
Purchased in-process research and development 9,201 1,500
Siliconix transaction-related expenses 3,751 -
Restructuring and severance costs 18,178 7,057
Asset write-downs 4,813 -
Operating income 62,364 168,486
3.7% 9.0%
Other income (expense):
Interest expense (24,685) (26,161)
Minority interest (3,918) (9,116)
Other 13,688 8,440
(14,915) (26,837)
Earnings before taxes 47,449 141,649
Income taxes 12,065 42,495
Net earnings $ 35,384 $ 99,154
Basic earnings per share $ 0.20 $ 0.61
Diluted earnings per share $ 0.20 $ 0.55
Weighted average shares outstanding - basic 175,439 162,919
Weighted average shares outstanding - diluted 187,099 203,997
* As a result of a concentrated effort to defend its intellectual property
and generate additional licensing income, Vishay began receiving royalties in
the fourth quarter of 2004. The Company expects royalty revenues to increase and
continues to seek to expand its royalty streams. The Company previously
classified royalties as other income. Beginning with the third quarter of 2005,
royalties are now classified as revenue. Previous periods have been reclassified
to conform to the current financial statement presentation. Royalty revenues
during the third quarter of 2005 and the nine fiscal months ended October 1,
2005 were $1,564,000 and $3,002,000, respectively. There were no royalty
revenues for the comparable prior year periods.
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)
October 1, December 31,
2005 2004
------------ ------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 606,997 $ 632,700
Accounts receivable, net 348,809 351,710
Inventories:
Finished goods 156,177 155,195
Work in process 152,678 150,738
Raw materials 194,296 212,040
Deferred income taxes 41,271 43,786
Prepaid expenses and other current assets 112,105 136,251
Total current assets 1,612,333 1,682,420
Property and equipment, at cost:
Land 90,309 97,398
Buildings and improvements 396,796 428,829
Machinery and equipment 1,648,455 1,668,225
Construction in progress 66,344 75,974
Allowance for depreciation (1,130,471) (1,098,611)
1,071,433 1,171,815
Goodwill 1,474,831 1,435,121
Other intangible assets, net 161,298 127,797
Other assets 249,134 221,437
Total assets $ 4,569,029 $ 4,638,590
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets, continued
(In thousands)
October 1, December 31,
2005 2004
------------ ------------
(unaudited)
Liabilities and stockholders' equity
Current liabilities:
Notes payable to banks $ 3,902 $ 3,727
Trade accounts payable 110,559 131,243
Payroll and related expenses 122,349 131,128
Other accrued expenses 189,124 218,257
Income taxes 26,188 29,631
Current portion of long-term debt 28 51
Total current liabilities 452,150 514,037
Long-term debt less current portion 744,084 752,145
Deferred income taxes 65,598 14,017
Deferred grant income 13,469 18,723
Other liabilities 158,208 236,591
Accrued pension and other postretirement costs 216,499 232,142
Minority interest 4,266 97,600
Stockholders' equity:
Common stock 16,943 15,142
Class B common stock 1,468 1,468
Capital in excess of par value 2,225,705 2,028,253
Retained earnings 630,276 594,892
Unearned compensation (116) (152)
Accumulated other comprehensive income 40,479 133,732
2,914,755 2,773,335
$ 4,569,029 $ 4,638,590
VISHAY INTERTECHNOLOGY, INC.
Computation of Earnings Per Share
(Unaudited - In thousands except earnings per share)
Fiscal quarter ended Nine fiscal months ended
--------------------------- ---------------------------
October 1, October 2, October 1, October 2,
2005 2004 2005 2004
------------ ------------ ------------ ------------
Numerator:
Numerator for basic earnings
per share - net earnings $ 19,956 $ 22,070 $ 35,384 $ 99,154
Interest savings assuming
conversion of dilutive
convertible and exchangeable
notes, net of tax 683 1,121 2,034 13,498
Numerator for diluted
earnings per share -
adjusted net earnings $ 20,639 $ 23,191 $ 37,418 $ 112,652
Denominator:
Denominator for basic
earnings per share -
weighted average shares 184,114 166,090 175,439 162,919
Effect of dilutive securities
Convertible and
exchangeable notes 10,604 15,493 10,666 38,456
Employee stock options 925 1,149 918 2,204
Warrants - - - 348
Other 76 68 76 70
Dilutive potential common
shares 11,605 16,710 11,660 41,078
Denominator for diluted
earnings per share -
adjusted weighted average
shares 195,719 182,800 187,099 203,997
Basic earnings per share $ 0.11 $ 0.13 $ 0.20 $ 0.61
Diluted earnings per share $ 0.11 $ 0.13 $ 0.20 $ 0.55
Diluted earnings per share for the periods presented do not reflect the
following weighted-average potential common shares, as the effect would be
antidilutive (in thousands):
Fiscal quarter ended Nine fiscal months ended
--------------------------- ---------------------------
October 1 October 2 October 1 October 2
2005 2004 2005 2004
------------ ------------ ------------ ------------
Convertible and exchangeable
notes:
Convertible Subordinated
Notes, due 2023 23,496 23,496 23,496 -
Exchangeable Unsecured
Notes, due 2102 6,176 - 6,176 -
Weighted average employee
stock options 6,046 5,723 6,242 2,684
Weighted average warrants 8,824 8,824 8,824 6,490
Contact: Richard N. Grubb,
Executive Vice President and
Chief Financial Officer or
Peter G. Henrici, Senior Vice
President Corporate Communications
610-644-1300
SOURCE Vishay Intertechnology, Inc.
-0- 11/04/2005
/CONTACT: Richard N. Grubb, Executive Vice President and Chief Financial
Officer, or Peter G. Henrici, Senior Vice President Corporate Communications,
both of Vishay Intertechnology, +1-610-644-1300/
/Web site: http://www.vishay.com /