News

Vishay Reports Results For Second Quarter 2009

July 29, 2009 by Jeff Shepard

Vishay Intertechnology, Inc. announced that revenues for the fiscal quarter ended June 27, 2009 were $460.3 million, compared to $774.4 million for the fiscal quarter ended June 28, 2008. The net loss attributable to Vishay stockholders for the fiscal quarter ended June 27, 2009 was $58.9 million, or $0.32 per share, compared to a net loss attributable to Vishay stockholders of $747.9 million, or $4.01 per share for the fiscal quarter ended June 28, 2008.

The net loss attributable to Vishay stockholders for the fiscal quarter ended June 27, 2009 was impacted by pretax charges for restructuring and severance costs of $12.1 million and for an amended executive employment agreement of $57.8 million, partially offset by a gain of $28.2 million on settlement of matters related to the acquisition of International Rectifier’s Power Control Systems business. These items and their related tax effects had a negative $0.22 per share effect on the net loss attributable to Vishay stockholders.

The net loss attributable to Vishay stockholders for the fiscal quarter ended June 28, 2008 was substantially attributable to a noncash goodwill impairment charge of $800 million ($770 million, net of tax). The second quarter 2008 results also include a pretax charge for restructuring and severance costs of $8.9 million and $9.9 million of tax expense associated with the repatriation of cash from certain non-U.S. subsidiaries. On an after tax basis, these items and the goodwill impairment charge had a negative $4.21 per share effect on income (loss) from continuing operations.

Revenues for the six fiscal months ended June 27, 2009 were $909.8 million, compared to $1,507.7 million for the six fiscal months ended June 28, 2008. The net loss attributable to Vishay stockholders for the six fiscal months ended June 27, 2009 was $88.0 million, or $0.47 per share, compared to a net loss attributable to Vishay stockholders of $778.6 million, or $4.18 per share for the six fiscal months ended June 28, 2008.

The net loss attributable to Vishay stockholders for the six fiscal months ended June 27, 2009 was impacted by pretax charges for restructuring and severance costs of $31.0 million and for an amended executive employment agreement of $57.8 million, partially offset by a gain of $28.2 million on settlement of matters related to the acquisition of International Rectifier’s Power Control Systems business. These items and their related tax effects had a negative $0.29 per share effect on the net loss attributable to Vishay stockholders.

The net loss attributable to Vishay stockholders for the six fiscal months ended June 28, 2008 was impacted by pretax charges for goodwill impairment of $800 million, restructuring and severance costs of $27.1 million, related asset write-downs of $4.2 million, and $9.9 million of tax expense associated with the repatriation of cash from certain non-U.S. subsidiaries. Including the tax effects of the pretax charges, these items had a negative $4.30 per share effect on earnings (loss) from continuing operations. The net loss for the six fiscal months ended June 28, 2008 also included a loss on discontinued operations of $42.1 million, or $0.23 per share.

As previously disclosed, the results of operations for the fiscal quarter and six fiscal months ended June 28, 2008 have been recast to include the retrospective effects of FSP APB 14-1. The retrospective application of this FSP increased the reported loss from continuing operations for the quarter and year-to-date periods by $6.2 million ($0.03 per share) and $12.3 million ($0.07 per share), respectively.

Commenting on the results for the second quarter 2009, Dr. Gerald Paul, President and Chief Executive Offic stated, "As expected, the semiconductors business started to recover in the course of the quarter due to strength in Asia, especially in portable computing. The passive components business was impacted by the weakness of Europe and the Americas, in particular in the industrial end-use markets. During the quarter we reduced our inventories by 7%, and distributors reduced their inventories of our products by 12%. Cash generated from operations was $69 million and capital expenditures were $18 million in the first half of 2009. We expect to continue to generate strong operating cash flows for the remainder of 2009, while limiting our capital expenditures."

Dr. Paul continued, "At only slightly higher sales quarter over quarter, our operating results have improved substantially due to our cost reduction initiatives. This progress was not yet reflected in our bottom line due to losses for foreign exchange rate effects recorded in other income (expense), which followed unusually high gains for exchange rate effects in the previous quarter."