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Section 1: 8-K (8-K)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported):      
May 7, 2019
Vishay Precision Group, Inc.
(Exact Name of Registrant as Specified in Charter)
Delaware
1-34679
27-0986328
(State or Other Jurisdiction of
(Commission File Number)
(I.R.S. Employer Identification
Incorporation or Organization)
 
Number)

3 Great Valley Parkway, Suite 150
 
Malvern, PA
19355
(Address of Principal Executive Offices)
(Zip Code)
(484) 321-5300
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common stock, $0.10 par value
VPG
New York Stock Exchange
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[   ]      
Written communications pursuant to Rule 425 under the Securities Act
 
     
 
[   ]      
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
 
     
 
[   ]      
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
 
     
 
[   ]      
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
 
Emerging growth company ¨
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨





Item 2.02 Results of Operations and Financial Conditions.
On May 7, 2019, Vishay Precision Group, Inc. issued a press release announcing results for the first quarter of fiscal 2019. A copy of the press release is furnished as Exhibit 99.1 to this Form 8-K and shall not be deemed to be “filed” for any purpose.
Item 9.01 Financial Statements and Exhibits.
Exhibit No.
     
Description
99.1
 





SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Vishay Precision Group, Inc.
 
 
Date: May 7, 2019
By:  
/s/ William M. Clancy
 
 
Name: William M. Clancy
 
 
Title:    Executive Vice President and Chief
 
 
Financial Officer


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Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
Exhibit 99.1
For Immediate Release
VPG Reports Fiscal 2019 First Quarter Results
MALVERN, Pa. (May 7, 2019) - Vishay Precision Group, Inc. (NYSE: VPG), a leading producer of precision sensors and sensor-based systems, today announced its results for its fiscal 2019 first quarter ended March 30, 2019.
First Quarter Highlights:
Growth in revenues to $76.5 million, up 4.7% year-over-year
Gross profit margin was 43.2% for the quarter as compared to 39.0% for the prior year period
Operating income increased by 54% to $12.6 million as compared to $8.2 million in the prior year period
Operating margin for the quarter was 16.5%, compared to 11.2% for the prior year period
Earnings increased 65% to $0.61 per diluted share, compared to $0.37 reported last year
Cash from operations was $8.1 million with free cash flow* of $4.8 million

Ziv Shoshani, Chief Executive Officer of VPG, commented, “We are pleased to report a strong start to 2019, highlighted by solid revenues and a substantial increase in margins. Performance in the quarter was largely the result of execution on our strategic plan, which was bolstered by a favorable mix of business during the period. We remain focused on building on the strong cash generation delivered through the first quarter, and driving long-term shareholder value.”
The Company grew first fiscal quarter 2019 net earnings attributable to VPG stockholders to $8.2 million, or $0.61 per diluted share, compared to $5.0 million, or $0.37 per diluted share, in the first fiscal quarter of 2018. Foreign currency exchange rates for the first quarter of 2019 increased net income by $0.3 million, or $0.02 per diluted share, relative to the prior year period.
Segments
Foil Technology Products segment revenues grew 8.5% to $37.0 million in the first fiscal quarter of 2019, up from $34.2 million in the first fiscal quarter of 2018; sequential revenue increased 0.8% compared to $36.7 million in the fourth quarter of 2018. The year-over-year increase in revenues were attributable to Pacific Instruments products in the Americas for end user customers in the avionics, military and space market and Advanced Sensor products in the force measurement market primarily in Asia and the Americas.
Gross profit margin for the Foil Technology Products segment was 44.7% for the first fiscal quarter of 2019, an increase compared to 42.8% in the first fiscal quarter of 2018, and an increase compared to 42.0% in the fourth fiscal quarter of 2018. The year-over-year increase in gross profit margin was primarily due to an increase in volume. Sequentially, gross profit margin increased due to an increase in volume and manufacturing efficiencies.
Force Sensors segment revenues declined 13.0% to $16.7 million in the first fiscal quarter of 2019, compared to $19.2 million in the first fiscal quarter of 2018; sequential revenue decreased 1.6%, compared to $17.0 million in the fourth quarter of 2018. The year-over-year and sequential decreases in revenues were mainly attributable to OEM customers in the force measurement market, primarily in the Americas.
Gross profit margin for the Force Sensors segment was 30.2% for the first fiscal quarter of 2019, an increase compared to 27.3% in the first fiscal quarter of 2018, and an increase compared to 26.6% in the fourth fiscal quarter of 2018. The year-over-year increase in gross profit margin was primarily due to manufacturing efficiencies and export grants in India partially offset by a decrease in volume. Sequentially, gross profit margin increased due to export grants in India and positive foreign exchange rate impact partially offset by a decrease in volume.

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Weighing and Control Systems segment revenues grew by 15.4% to $22.7 million in the first fiscal quarter of 2019, up from $19.7 million in the first fiscal quarter of 2018; sequential revenue decreased 2.1% from $23.2 million in the fourth fiscal quarter of 2018. The increase in revenues year-over-year was primarily attributable to the steel product line in all regions. The sequential decrease in revenue was primarily attributable to a decrease in the steel product line in Asia and the process weighing and onboard weighing product lines in the Americas partially offset by an increase in the onboard weighing product line in Europe.
The first fiscal quarter 2019 gross profit margin for the Weighing and Control Systems segment was 50.2%, an increase compared to 43.9% from the first fiscal quarter of 2018, and an increase compared to 46.8% from the fourth fiscal quarter of 2018. The year-over-year increase in gross profit margin was primarily due to the increase in volume. Sequential gross profit margin increase was primarily due to manufacturing efficiencies.
Near-Term Outlook
Given the current business environment and our most recent order intake, at constant first fiscal quarter 2019 exchange rates, we expect net revenues in the range of $70 million to $76 million for the second fiscal quarter of 2019,” concluded Mr. Shoshani.
*Use of Non-GAAP Financial Information
We define "free cash flow" as the amount of cash generated from operations ($8.1 million for the first fiscal quarter of 2019), in excess of our capital expenditures ($3.3 million for the first fiscal quarter of 2019) net of proceeds, if any, from the sale of assets ($0.0 million for the first fiscal quarter of 2019).
Conference Call and Webcast
A conference call will be held today (May 7) at 10:00 a.m. ET (9:00 a.m. CT). To access the conference call, interested parties may call 1-888-317-6003 or internationally 1-412-317-6061 and use passcode 0105250, or log on to the investor relations page of the VPG website at www.vpgsensors.com.
A replay will be available approximately one hour after the completion of the call by calling toll-free 1-877-344-7529 or internationally 1-412-317-0088 and by using the passcode 10130492. The replay will also be available on the investor relations page of the VPG website at www.vpgsensors.com for a limited time.
About VPG
Vishay Precision Group, Inc. (VPG) is an internationally recognized designer, manufacturer and marketer of: components based on its resistive foil technology; sensors; and sensor-based measurement systems specializing in the growing markets of stress, force, weight, pressure, and current measurements. VPG is a market leader of foil technology products, providing ongoing technology innovations in precision foil resistors and foil strain gages, which are the foundation of the company's force sensors products and its weighing and control systems. The product portfolio consists of a variety of well-established brand names recognized for precision and quality in the marketplace. To learn more, visit VPG at www.vpgsensors.com.
Forward-Looking Statements
From time to time, information provided by us, including but not limited to statements in this report, or other statements made by or on our behalf, may contain "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks, uncertainties, and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from those anticipated.
Such statements are based on current expectations only, and are subject to certain risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, expected, estimated, or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; difficulties or delays in completing acquisitions and

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integrating acquired companies; the inability to realize anticipated synergies and expansion possibilities; difficulties in new product development; changes in competition and technology in the markets that we serve and the mix of our products required to address these changes; changes in foreign currency exchange rates; political, economic and military instability in the countries in which we operate; difficulties in implementing our cost reduction strategies, such as underutilization of production facilities, labor unrest or legal challenges to our lay-off or termination plans, operation of redundant facilities due to difficulties in transferring production to achieve efficiencies; significant developments from the recent and potential changes in tariffs and trade regulation; and other factors affecting our operations, markets, products, services, and prices that are set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
For Investors
ICR, Inc.
Michael Callahan, 203-682-8311
michael.callahan@icrinc.com

For Media
ICR, Inc.
Phil Denning, 646-277-1258
phil.denning@icrinc.com




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VISHAY PRECISION GROUP, INC.
 
 
 
Consolidated Condensed Statements of Operations
 
 
 
(Unaudited - In thousands, except per share amounts)
 
 
 
 
 
 
 
 
Fiscal quarter ended
 
March 30, 2019
 
March 31, 2018
Net revenues
$
76,525

 
$
73,091

Costs of products sold
43,474

 
44,586

Gross profit
33,051

 
28,505

Gross profit margin
43.2
%
 
39.0
%
 
 
 
 
Selling, general, and administrative expenses
20,448

 
20,319

Operating income
12,603

 
8,186

Operating margin
16.5
%
 
11.2
%
 
 
 
 
Other income (expense):
 
 
 
Interest expense
(388
)
 
(442
)
Other
(772
)
 
(649
)
Other income (expense) - net
(1,160
)
 
(1,091
)
 
 
 
 
Income before taxes
11,443

 
7,095

 
 
 
 
Income tax expense
3,117

 
2,137

 
 
 
 
Net earnings
8,326

 
4,958

Less: net earnings attributable to noncontrolling interests
83

 
(30
)
Net earnings attributable to VPG stockholders
$
8,243

 
$
4,988

 
 
 
 
Basic earnings per share attributable to VPG stockholders
$
0.61

 
$
0.37

Diluted earnings per share attributable to VPG stockholders
$
0.61

 
$
0.37

 
 
 
 
Weighted average shares outstanding - basic
13,495

 
13,342

Weighted average shares outstanding - diluted
13,563

 
13,497




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VISHAY PRECISION GROUP, INC.
 
 
 
Consolidated Condensed Balance Sheets
 
 
 
(In thousands)
 
 
 
 
March 30, 2019
 
December 31, 2018
 
(Unaudited)
 
 
Assets
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
93,144

 
$
90,159

Accounts receivable, net
52,484

 
53,156

Inventories:
 
 
 
Raw materials
18,832

 
18,052

Work in process
23,480

 
22,007

Finished goods
21,059

 
22,182

Inventories, net
63,371

 
62,241

 
 
 
 
Prepaid expenses and other current assets
12,815

 
9,314

Total current assets
221,814

 
214,870

 
 
 
 
Property and equipment, at cost:
 
 
 
Land
3,411

 
3,390

Buildings and improvements
51,298

 
51,055

Machinery and equipment
107,404

 
105,840

Software
8,942

 
8,532

Construction in progress
1,542

 
2,157

Accumulated depreciation
(113,575
)
 
(111,555
)
Property and equipment, net
59,022

 
59,419

 
 
 
 
Goodwill
16,238

 
16,141

 
 
 
 
Intangible assets, net
17,390

 
17,656

 
 
 
 
Other assets
28,326

 
18,297

Total assets
$
342,790

 
$
326,383



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VISHAY PRECISION GROUP, INC.
 
 
 
Consolidated Condensed Balance Sheets
 
 
 
(In thousands)
 
 
 
 
March 30, 2019
 
December 31, 2018
 
(Unaudited)
 
 
Liabilities and equity
 
 
 
Current liabilities:
 
 
 
Trade accounts payable
$
10,736

 
$
11,461

Payroll and related expenses
18,411

 
17,757

Other accrued expenses
18,780

 
17,031

Income taxes
2,277

 
3,879

Current portion of long-term debt
4,766

 
4,654

Total current liabilities
54,970

 
54,782

 
 
 
 
Long-term debt, less current portion
21,172

 
22,421

Deferred income taxes
2,200

 
2,200

Other liabilities
21,541

 
13,545

Accrued pension and other postretirement costs
15,029

 
14,982

Total liabilities
114,912

 
107,930

 
 
 
 
Commitments and contingencies
 
 
 
 
 
 
 
Equity:
 
 
 
Common stock
1,311

 
1,307

Class B convertible common stock
103

 
103

Treasury stock
(8,765
)
 
(8,765
)
Capital in excess of par value
196,578

 
196,666

Retained earnings
75,343

 
66,569

Accumulated other comprehensive loss
(36,779
)
 
(37,465
)
Total Vishay Precision Group, Inc. stockholders' equity
227,791

 
218,415

Noncontrolling interests
87

 
38

Total equity
227,878

 
218,453

Total liabilities and equity
$
342,790

 
$
326,383






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VISHAY PRECISION GROUP, INC.
 
 
 
Consolidated Condensed Statements of Cash Flows
 
 
 
(Unaudited - In thousands)
 
 
 
 
 
 
 
 
Fiscal quarter ended
 
March 30, 2019
 
March 31, 2018
Operating activities
 
 
 
Net earnings
$
8,326

 
$
4,958

Adjustments to reconcile net earnings to net cash provided by operating activities:
 
 
 
Depreciation and amortization
2,854

 
2,684

Loss/(gain) on disposal of property and equipment
1

 
(53
)
Share-based compensation expense
514

 
373

Inventory write-offs for obsolescence
489

 
613

Deferred income taxes
313

 
268

Other
(2,367
)
 
(723
)
Net changes in operating assets and liabilities:
 
 
 
Accounts receivable, net
850

 
(5,519
)
Inventories, net
(1,507
)
 
(1,910
)
Prepaid expenses and other current assets
(3,484
)
 
(2,517
)
Trade accounts payable
628

 
1,687

Other current liabilities
1,488

 
1,943

Net cash provided by operating activities
8,105

 
1,804

 
 
 
 
Investing activities
 
 
 
Capital expenditures
(3,334
)
 
(4,296
)
Proceeds from sale of property and equipment
29

 
53

Net cash used in investing activities
(3,305
)
 
(4,243
)
 
 
 
 
Financing activities
 
 
 
Principal payments on long-term debt
(1,155
)
 
(2,970
)
Proceeds from revolving facility

 
8,000

Payments on revolving facility

 
(3,000
)
Distributions to noncontrolling interests
(34
)
 
(117
)
Payments of employee taxes on certain share-based arrangements
(795
)
 
(785
)
Net cash (used in) provided by financing activities
(1,984
)
 
1,128

Effect of exchange rate changes on cash and cash equivalents
169

 
753

Increase (decrease) in cash and cash equivalents
2,985

 
(558
)
 
 
 
 
Cash and cash equivalents at beginning of period
90,159

 
74,292

Cash and cash equivalents at end of period
$
93,144

 
$
73,734

 
 
 
 
Supplemental disclosure of non-cash investing transactions:
 
 
 
Capital expenditures purchased
$
(1,986
)
 
$
(1,773
)
Supplemental disclosure of non-cash financing transactions:
 
 
 
Conversion of exchangeable notes to common stock
$

 
$
(2,794
)




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