Vicor Corp. Reports Operating Results (10-Q)

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May 02, 2011
Vicor Corp. (VICR, Financial) filed Quarterly Report for the period ended 2011-03-31.

Vicor Corp. has a market cap of $697.98 million; its shares were traded at around $16.71 with a P/E ratio of 23.87 and P/S ratio of 2.78.

Highlight of Business Operations:

Revenues for the first quarter increased by 36.3% to $70,455,000, compared to $51,709,000 for the corresponding period a year ago, but decreased by 3.5% on a sequential basis from $72,975,000 for the fourth quarter of 2010. Gross margin increased to $30,454,000 for the first quarter of 2011, compared to $23,324,000 for the corresponding period a year ago, but decreased on a sequential basis from $32,984,000 for the fourth quarter of 2010. Gross margin, as a percentage of revenue, decreased to 43.2% for the first quarter of 2011 compared to 45.1% for the first quarter of 2010 and decreased on a sequential basis from 45.2% for the fourth quarter of 2010. Net income attributable to Vicor Corporation for the first quarter was $4,018,000, or $0.10 per diluted share, compared to net income attributable to Vicor Corporation of $1,952,000, or $0.05 per diluted share, for the corresponding period a year ago and net income attributable to Vicor Corporation of $10,807,000, or $0.26 per diluted share, for the fourth quarter of 2010.

Operating expenses for the three months ended March 31, 2011 increased $3,286,000, or 15.8%, to $24,034,000 from $20,748,000 in 2010, principally due to an increase in selling, general and administrative expenses of $2,300,000, and research and development expenses of $986,000. The key increases in selling, general and administrative expenses were in compensation expense of $1,029,000, legal expense of $871,000, and commissions expense of $318,000, partially offset by a decrease in audit and tax fees of $75,000. The key increases in research and development expenses were in compensation expense of $705,000, deferred costs of $80,000, depreciation and amortization of $60,000, project materials of $58,000, and computer expense of $36,000, partially offset by a decrease in outside services of $87,000.

Other income (expense), net for the three months ended March 31, 2011 decreased $265,000 to $(198,000) from $67,000 in the corresponding period in 2010. The primary reasons for the decrease were an increase in foreign currency losses of $239,000 and a decrease in interest income of $71,000, partially offset by an increase in credit gain on available-for-sale securities of $50,000.

For the three months ended March 31, 2011, depreciation and amortization was $2,628,000 and capital additions were $2,973,000, compared to $2,432,000 and $2,429,000, respectively, for the first three months of 2010.

Inventories increased by approximately $121,000 or 0.3% to $35,610,000 as compared with $35,489,000 at December 31, 2010. This increase was primarily attributed to an increase in BBU inventories of $478,000, partially offset by a decrease in V*I Chip and Picor inventories of approximately $320,000, and $37,000, respectively.

At March 31, 2011, the Company had $56,400,000 in cash and cash equivalents. The ratio of current assets to current liabilities was 5.3:1 as of March 31, 2011, and 5.6:1 as of December 31, 2010. Working capital increased $5,316,000 to $110,770,000 as of March 31, 2011, from $105,454,000 as of December 31, 2010. The primary factors affecting the working capital increase were increases in cash and cash equivalents of $7,121,000, accounts receivable of $971,000, deferred tax assets of $335,000 and inventories of $121,000, partially offset by increases in accrued expenses of $1,098,000, accounts payable of $795,000, accrued compensation and benefits of $717,000, and income taxes payable of $667,000. The primary source of cash for the three months ended March 31, 2011, was $9,906,000 from operating activities. The primary use of cash for the three months ended March 31, 2011 was $2,973,000 for the purchase of equipment.

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