Vicor Corporation designs develops manufactures and markets modular power components and complete power systems using an innovative patented high frequency electronic power conversion technology. Power systems a central element in any electronic system convert power from a primary power source (e.g. a wall outlet) into the stable DC voltages that are required by most contemporary electronic circuits. Vicor Corp. has a market cap of $253.8 million; its shares were traded at around $6.09 with and P/S ratio of 1.3. Highlight of Business Operations: Revenues for the first quarter decreased by 5.7% to $50,448,000, compared to $53,469,000 for the corresponding period a year ago, and decreased 1.7% on a sequential basis from $51,324,000 for the fourth quarter of 2008. Gross margin decreased to $21,831,000 for the first quarter of 2009, compared to $22,460,000 for the corresponding period a year ago, and increased on a sequential basis from $20,809,000 for the fourth quarter of 2008. Gross margin, as a percentage of revenue, increased to 43.3% for the first quarter of 2009 compared to 42.0% for the first quarter of 2008, and increased on a sequential basis from 40.5% for the fourth quarter of 2008. Net income (loss) attributable to Vicor Corporation for the first quarter was $(2,543,000), or $(0.06) per diluted share, compared to net income (loss) attributable to Vicor Corporation of $620,000, or $0.01 per diluted share, for the corresponding period a year ago and net loss attributable to Vicor Corporation of $(3,501,000), or $(0.08) per diluted share, for the fourth quarter of 2008.
Operating expenses for the three months ended March 31, 2009 increased $2,109,000, or 9.8%, from $21,563,000 in 2008 to $23,672,000, principally due to a pre-tax severance charge of $3,098,000 in connection with a workforce reduction completed in the first quarter of 2009. This was partially offset by a decrease in selling, general and administrative expenses of $1,229,000. The key decreases in selling, general and administrative expenses were legal fees of $647,000 and audit and tax fees of $452,000.
Other income (expense), net for the three months ended March 31, 2009 decreased $1,082,000 from $1,200,000 in 2008 to $118,000. The primary reasons for the decrease were a decrease in interest income of $673,000 and an increase in foreign currency losses of $326,000.
For the three months ended March 31, 2009, depreciation and amortization was $2,625,000, an increase of approximately $39,000 for the corresponding period a year ago, and capital additions decreased by $1,296,000 to $1,029,000 compared to the corresponding period a year ago.
Inventories decreased by approximately $1,050,000 or 3.9% to $25,631,000 as compared with $26,681,000 at December 31, 2008. The decrease was primarily attributed to a decrease in BBU inventories of approximately $1,028,000 and a decrease in V*I Chip inventories of $372,000, offset by an increase in Picors inventories of $350,000.
At March 31, 2009, the Company had $25,136,000 in unrestricted cash and cash equivalents. The ratio of current assets to current liabilities was 4.3:1 at March 31, 2009 compared to 4.7:1 at December 31, 2008. Working capital decreased $762,000 from $65,297,000 at December 31, 2008, to $64,535,000 at March 31, 2009. The primary factors affecting the working capital decrease was an increase in accrued severance charge of $1,990,000, decreases in inventories of $1,050,000 and short term investments of $612,000, offset by increases in cash and cash equivalents of $2,497,000 and other current assets of $538,000. The primary source of cash for the three months ended March 31, 2009, was $3,421,000 from operating activities. The primary use of cash for the three months ended March 31, 2009 was $1,029,000 for the purchase of equipment.
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