On February 12, 2025, Vishay Precision Group Inc (VPG, Financial) released its 8-K filing detailing the financial results for the fourth quarter and full fiscal year ending December 31, 2024. The company, known for its precision measurement technologies, reported a challenging quarter with revenues of $72.7 million, falling short of the analyst estimate of $73.68 million. The diluted net earnings per share were $0.06, significantly below the estimated $0.13 per share.
Company Overview
Vishay Precision Group Inc (VPG, Financial) specializes in manufacturing and marketing sensors, sensor-based measurement systems, and specialty resistors and strain gages. The company operates in three segments: Sensors, Weighing Solutions, and Measurement Systems, with a significant portion of its revenue generated in the United States.
Performance and Challenges
VPG's fourth-quarter performance was marked by an 18.8% decrease in revenues compared to the previous year. The gross profit margin also declined to 38.2% from 43.0% a year ago. The operating margin dropped sharply to 0.3% from 13.4% in the prior year. These declines highlight the company's struggle with macroeconomic and cyclical headwinds, impacting its profitability and operational efficiency.
Financial Achievements
Despite the challenges, VPG achieved a book-to-bill ratio of 1.00 in the fourth quarter, indicating a balance between new orders and shipments. This was driven by strong performance in the Sensors and Weighing Solutions segments, which achieved book-to-bill ratios above 1.00. The company's focus on industrial and medical robotics, data center, and telecommunications applications is expected to drive future growth.
Key Financial Metrics
For the full year 2024, VPG reported revenues of $306.5 million, slightly below the estimated revenue of $307.53 million, a 13.7% decrease from the previous year. The gross profit margin was 41.0%, slightly down from 42.3% in 2023. The operating margin was 5.5%, compared to 11.8% last year. Net earnings attributable to VPG stockholders were $9.9 million, or $0.74 per diluted share, compared to $25.7 million, or $1.88 per diluted share, in 2023.
| Metric | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 |
|---|---|---|---|---|
| Revenues | $72.7 million | $89.5 million | $306.5 million | $355.0 million |
| Gross Profit Margin | 38.2% | 43.0% | 41.0% | 42.3% |
| Operating Margin | 0.3% | 13.4% | 5.5% | 11.8% |
| Diluted EPS | $0.06 | $0.31 | $0.74 | $1.88 |
Segment Performance
The Sensors segment saw a 24.8% year-over-year revenue decline, primarily due to lower sales in the Test & Measurement market. The Weighing Solutions segment experienced a 15.4% decrease in revenues, while the Measurement Systems segment reported a 14.8% decline, impacted by lower sales of Dynamic Systems Inc. and Diversified Technical Systems, Inc. products.
Analysis and Outlook
VPG's financial results reflect the challenges faced in 2024, with significant declines in revenue and profitability. However, the company's strategic focus on high-growth markets and its strong balance sheet position it well for future opportunities. The integration of Nokra, acquired in September 2024, is progressing, and VPG remains committed to acquiring additional high-quality businesses to enhance its portfolio.
Ziv Shoshani, Chief Executive Officer of VPG, commented, "2024 proved to be a challenging year, as we faced macro and cyclical headwinds. Nonetheless, orders in the fourth fiscal quarter of $72.4 million grew 5.5% sequentially resulting in a book-to-bill ratio of 1.00."
For the first fiscal quarter of 2025, VPG expects net revenues to range between $70 million and $76 million, indicating a cautious but optimistic outlook for the coming year.
Explore the complete 8-K earnings release (here) from Vishay Precision Group Inc for further details.
