Vishay Intertechnology Inc. Reports Operating Results (10-Q)
Vishay Intertechnology Inc. is a leading international manufacturer and supplier of discrete passive electronic components and discrete active electronic components particularly resistors capacitors inductors diodes and transistors. The company offers its customers one-stop access to one of the most comprehensive electronic component lines of any manufacturer in the United States or Europe. Passive electronic components discrete active electronic components and integrated circuits are the primary elements of every electronic circuit. Vishay Intertechnology Inc. has a market cap of $1.17 billion; its shares were traded at around $6.25 with a P/E ratio of 24 and P/S ratio of 0.4. Vishay Intertechnology Inc. had an annual average earning growth of 23.3% over the past 5 years. Highlight of Business Operations: Net revenues for the fiscal quarter ended March 28, 2009 were $449.5 million, compared to $733.3 million for the fiscal quarter ended March 29, 2008. The net loss attributable to Vishay stockholders for the fiscal quarter ended March 28, 2009 was $29.1 million or $0.16 per share, compared to a net loss attributable to Vishay stockholders of $30.7 million or $0.16 per share for the fiscal quarter ended March 29, 2008.
The net loss attributable to Vishay stockholders for the fiscal quarter ended March 28, 2009 was impacted by pretax charges for restructuring and severance costs of $18.9 million, which had a $0.08 per share after-tax effect on the net loss.
The net loss attributable to Vishay stockholders for the fiscal quarter ended March 29, 2008 was impacted by pretax charges for restructuring and severance costs of $18.2 million and related asset write-downs of $4.2 million. These items and their tax-related consequences had a negative $0.10 per share effect on income from continuing operations attributable to Vishay stockholders. The net loss for the fiscal quarter ended March 29, 2008 also included a loss on discontinued operations of $42.1 million, or $0.23 per share.
The retrospective application of FSP APB 14-1 increased previously reported interest expense by $6.1 million, or $0.03 per diluted share, for the first quarter of 2008.
We incurred restructuring and severance costs of $28.6 million during the fourth quarter of 2008, and incurred additional restructuring and severance costs of $18.9 million during the first quarter of 2009. These costs were incurred as part of our program to reduce manufacturing and SG&A fixed costs in 2009 by $150 million compared to the year ended December 31, 2008. Our cost reduction programs are ahead of schedule. Our fixed costs in the first quarter of 2009 decreased by $54 million compared to the first quarter of 2008. Of this amount, approximately 40% reduced manufacturing costs and approximately 60% reduced SG&A expenses. We now believe that we will be able to reduce fixed costs by $200 million for the full year 2009 versus 2008, approximately equivalent to maintaining the present run-rate. Of this amount, approximately 50% is expected to reduce manufacturing costs and approximately 50% is expected to reduce SG&A expenses. Additionally, we intend to replace temporary measures with permanent measures to defend this cost reduction going forward, even after sales return to more normal levels.
We originally expected to incur restructuring and severance costs of approximately $25 million in 2009, but now believe that the total restructuring and severance costs will be closer to $50 million. Including unpaid balances from 2008 programs, we expect the 2009 cash outlay for restructuring and severance programs to be approximately $50 million, with additional amounts to be paid in future periods.
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