VISHAY INTERTECHNOLOGY INC - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - November 3, 2020

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Exhibit 99.1

VISHAY REPORTS RESULTS FOR THIRD QUARTER 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

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 Vishay’s 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.


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.


VISHAY INTERTECHNOLOGY, INC.
                  
Summary of Operations
                  
(Unaudited - In thousands, except per share amounts)
                  
                   
   
Fiscal quarters ended
  
   
October 3, 2020
    
July 4, 2020
    
September 28, 2019
  
                   
Net 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 administrative expenses**
    
90,219
      
89,127
      
91,796
  
Restructuring and severance costs
    
-
      
743
      
7,255
  
Operating 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 debt
    
(3,454
)
    
(1,146
)
    
-
  
  Total other income (expense) - net
    
(15,766
)
    
(11,060
)
    
(6,846
)
                         
Income 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 to noncontrolling interests
    
177
      
242
      
227
  
                         
Net earnings attributable to Vishay stockholders
  
$
33,484
    
$
24,653
    
$
30,038
  
                         
Basic earnings per share attributable to Vishay stockholders
  
$
0.23
    
$
0.17
    
$
0.21
  
                         
Diluted earnings per share attributable to Vishay stockholders
  
$
0.23
    
$
0.17
    
$
0.21
  
                         
Weighted average shares outstanding - basic
    
144,854
      
144,846
      
144,628
  
                         
Weighted average shares outstanding - diluted
    
145,197
      
145,170
      
145,027
  
                         
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 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 expenses*
    
279,178
      
290,332
  
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 noncontrolling interests
    
584
      
667
  
                 
Net earnings attributable to Vishay stockholders
  
$
85,356
    
$
149,974
  
                 
Basic earnings per share attributable to Vishay stockholders
  
$
0.59
    
$
1.04
  
                 
Diluted earnings per share attributable to Vishay stockholders
  
$
0.59
    
$
1.03
  
                 
Weighted average shares outstanding - basic
    
144,831
      
144,602
  
                 
Weighted average shares outstanding - diluted
    
145,221
      
145,114
  
                 
Cash 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 costs
    
277,758
      
272,402
  
Total 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 (loss)
    
(3,340
)
    
(26,646
)
  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 equity
  
$
3,033,833
    
$
3,120,775
  
VISHAY INTERTECHNOLOGY, INC.
            
Consolidated Condensed Statements of Cash Flows
            
(Unaudited - In thousands)
            
   
Nine fiscal months ended
  
   
October 3, 2020
    
September 28, 2019
  
             
Operating activities
            
Net earnings
  
$
85,940
    
$
150,641
  
Adjustments to reconcile net earnings to
                
    net 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 instruments
    
10,232
      
10,558
  
      Inventory 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 effects of businesses acquired
    
(27,408
)
    
(42,810
)
Net 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 for vested equity awards
    
(2,016
)
    
(2,708
)
Net cash used in financing activities
    
(192,130
)
    
(71,132
)
Effect of exchange rate changes on cash and cash equivalents
    
4,230
      
(8,141
)
                 
Net increase (decrease) in cash and cash equivalents
    
(11,711
)
    
45,451
  
                 
Cash 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, 2020
    
July 4, 2020
    
September 28, 2019
    
October 3, 2020
    
September 28, 2019
  
                               
GAAP net earnings attributable to Vishay stockholders
  
$
33,484
    
$
24,653
    
$
30,038
    
$
85,356
    
$
149,974
  
                                         
Reconciling items affecting gross profit:
                                        
Impact of the COVID-19 outbreak
  
$
242
    
$
923
    
$
-
     $
4,295
    
$
-
  
                                         
Other reconciling items affecting operating income:
                                  
Restructuring and severance costs
  
$
-
    
$
743
    
$
7,255
    
$
743
    
$
7,255
  
Impact of the COVID-19 outbreak
    
(441
)
    
(747
)
    
-
      
(871
)
    
-
  
                                         
Reconciling items affecting other income (expense):
                                  
Loss on early extinguishment of debt
  
$
3,454
    
$
1,146
    
$
-
    
$
7,520
    
$
1,307
  
                                         
Reconciling items affecting tax expense (benefit):
                                  
Change in deferred taxes due to early extinguishment of debt
  
$
-
    
$
-
    
$
-
    
$
(1,346
)
  
$
(1,312
)
Effects of tax-basis foreign exchange gain
    
-
      
-
      
-
      
-
      
7,554
  
Effects of cash repatriation program
    
-
      
(190
)
    
2,604
      
(190
)
    
1,971
  
Tax effects of pre-tax items above
    
(716
)
    
(589
)
    
(1,644
)
    
(2,787
)
    
(1,934
)
                                         
Adjusted net earnings
  
$
36,023
    
$
25,939
    
$
38,253
    
$
92,720
    
$
164,815
  
                                         
Adjusted weighted average diluted shares outstanding
    
145,197
      
145,170
      
145,027
      
145,221
      
145,114
  
                                         
Adjusted earnings per diluted share
  
$
0.25
    
$
0.18
    
$
0.26
    
$
0.64
    
$
1.14
  

VISHAY INTERTECHNOLOGY, INC.
                          
Reconciliation of Free Cash
                              
(Unaudited - In thousands)
                              
   
Fiscal quarters ended
    
Nine fiscal months ended
  
   
October 3, 2020
    
July 4, 2020
    
September 28, 2019
    
October 3, 2020
    
September 28, 2019
  
Net cash provided by operating activities
  
$
64,330
    
$
90,431
      
76,202
    
$
189,239
    
$
212,021
  
Proceeds from sale of property and equipment
    
63
      
177
      
22
      
293
      
486
  
Less: Capital expenditures
    
(21,969
)
    
(24,504
)
    
(30,119
)
    
(70,801
)
    
(100,267
)
Free 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 fiscal months ended
  
   
October 3, 2020
    
July 4, 2020
    
September 28, 2019
    
October 3, 2020
    
September 28, 2019
  
                               
GAAP net earnings attributable to Vishay stockholders
  
$
33,484
    
$
24,653
    
$
30,038
    
$
85,356
    
$
149,974
  
Net earnings attributable to noncontrolling interests
    
177
      
242
      
227
      
584
      
667
  
Net earnings
  
$
33,661
    
$
24,895
    
$
30,265
    
$
85,940
    
$
150,641
  
                                         
Interest expense
  
$
7,414
    
$
8,430
    
$
8,564
    
$
24,396
    
$
25,160
  
Interest income
    
(514
)
    
(956
)
    
(2,365
)
    
(3,324
)
    
(6,711
)
Income taxes
    
12,063
      
4,845
      
13,917
      
25,658
      
64,377
  
Depreciation and amortization
    
41,618
      
40,638
      
40,956
      
123,776
      
122,302
  
EBITDA
  
$
94,242
    
$
77,852
    
$
91,337
    
$
256,446
    
$
355,769
  
                                         
Reconciling items
                                        
Impact of the COVID-19 outbreak
  
$
(199
)
  
$
176
    
$
-
    
$
3,424
    
$
-
  
Restructuring and severance costs
    
-
      
743
      
7,255
      
743
      
7,255
  
Loss on early extinguishment of debt
    
3,454
      
1,146
      
-
      
7,520
      
1,307
  
                                         
Adjusted EBITDA
  
$
97,497
    
$
79,917
    
$
98,592
    
$
268,133
    
$
364,331
  
                                         
Adjusted EBITDA margin**
    
15.2
%
    
13.7
%
    
15.7
%
    
14.6
%
    
17.7
%
                                         
** Adjusted EBITDA as a percentage of net revenues
                                  


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




















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