Vishay posts $7M loss with charges; plant closings set

Electronic News, Feb 9, 1998

malvern, pa.--Vishay Intertechnology last week reported a fourth quarter loss of $7 million on $293.9 million in revenues, and revealed plans to close additional plants. The plants facing shutdowns are some of Vishay's current European passives facilities, but the company declined comment on which ones.

Vishay chairman/CEO Felix Zandman said that in preparation for expanding into the power semiconductor market via acquisition of 65 percent of Taiwan discrete maker Lite-On Power Semiconductor Corp. last year and the pending acquisition of the Temic semiconductor operations of Germany's Daimler-Benz AG, "We have accelerated the restructuring of our passive components business resulting in plans for additional plant closings at a cost of $12.6 million which are expected to result in annual savings of $10 million, inventory write-offs of $5.6 million and the reevaluation of various tax contingencies of $10 million."

The firm reported for the three months ended Dec. 31, 1997, sales were $293.9 million compared with $253.9 million in the previous year's fourth quarter. After special charges of $27.7 million, or 43 cents per share, the net loss for the quarter was $7 million, or 11 cents per share. Net earnings before special charges were $20.7 million,or 32 cents per share. Net earnings in the previous year's 4Q were $6.3 million, or 10 cents per share (after a restructuring charge of $13.2 million, or 16 cents per share). Pre-tax earnings exclusive of special charges were $30 million compared to $21.6 million in the previous year's quarter or an increase of 39 percent. Sales in the quarter were affected negatively by $13.9 million due to the continued strength of the U.S. dollar against European currencies.

For the twelve months ended Dec. 31, 1997, sales were $1.125 billion, compared with $1.097 billion in the previous year. Net earnings for the year were $53.3 million, or 83 cents per share (after special charges of $27.7 million,or 43 dents per share). Net earnings before special charges were $81 million, or $1.26 per share. Net earnings for the previous year were $52.6 million, or 82 cents per share (after a restructuring charge of $38 million, 41 cents per share). Pre-tax earnings exclusive of special charges were $112.8 million compared to $108.3 million for the previous year. Sales for the year ended Dec. 31, 1997 were affected negatively by $55.4 million due to the continued strength of the U.S. dollar against European currencies. Earnings-per-share amounts for all periods reflect a 5 percent stock dividend paid on June 9, 1997.

Dr. Zandman added: "These past few months have been very exciting for Vishay, as we take our first steps into the $14 billion discrete semiconductor business. With the Temic acquisition, which we expect to finalize in early March, and the Lite-On Power Semiconductor joint venture, we anticipate a substantial improvement of Vishay's profitability in 1998 and beyond."