investor presentation - ir.vishay.com · 2015. 2014: 2013. 2012: 2011. 2010: 2009. 2008: 2007....

2018 VISHAY INTERTECHNOLOGY, INC. ALL RIGHTS RESERVED.

INVESTOR PRESENTATION

AUGUST 2018 VISHAY TODAY GROWTH DRIVERS TARGETS & PROJECTIONS Q2 RESULTS


2

NOTES ON FORWARD-LOOKING STATEMENTSComments in this presentation other than statements of historical fact may constitute forward-looking statements. Words such as believe, estimate, will be, will, would, expect, anticipate, plan, project, intend, could, should or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance or achievements may vary materially from those anticipated, estimated or projected. Factors that could cause actual results to materially differ are described in our filings with the U.S. Securities and Exchange Commission, including our annual reports on Form 10-K and quarterly reports on Form 10-Q, specifically in the sections titled Managements Discussion and Analysis of Financial Condition and Results of Operations and Risk Factors . The Company undertakes no obligation to update any forward-looking statements.NON-GAAP FINANCIAL MEASURESManagement uses measures which are not recognized in accordance with U.S. generally accepted accounting principles (GAAP) to evaluate its business, and may refer to such measures in this presentation. These measures are considered non-GAAP financial measures under the U.S. Securities and Exchange Commission rules. These non-GAAP financial measures are intended to supplement our GAAP measures of performance and liquidity. These non-GAAP measures may include: adjusted net earnings, adjusted gross margin, adjusted operating margin, adjusted earnings per share, free cash, cash available to enhance stockholder value, EBITDA, Adjusted EBITDA, EBITDA margin, breakeven point, contribution margin, and various measures and metrics excluding VPG. Adjusted net earnings is net earnings (loss) determined in accordance with GAAP, adjusted for various items that Management believes are not indicative of the intrinsic operating performance of the Company, such as restructuring and severance costs, asset write-downs, impairment of goodwill, and other significant charges or credits that are important to understanding our intrinsic operations. The measurement is used by Management to evaluate our performance, and also is a key performance metric for executive compensation. Reconciling items to arrive at adjusted net earnings are more fully described in the Companys annual report on Form 10-K and its quarterly reports on Forms 10-Q. Adjusted gross margin is gross margin determined in accordance with GAAP (net revenue less costs of products sold and certain other period costs), adjusted to exclude items that Management believes are not indicative of the intrinsic operating performance of the Company, such as losses on purchase commitments and unusual inventory write-downs. It may be expressed in dollars or as a percentage of net revenue. The measurement is used by Management to evaluate the performance of our business segments, as well as the business as a whole. Reconciling items to arrive at adjusted gross margin are also considered in the calculation of adjusted operating margin and adjusted net earnings. Such reconciling items are more fully described in the Companys annual report on Form 10-K and its quarterly reports on Forms 10-Q.Adjusted operating margin is operating income determined in accordance with GAAP, adjusted for items that Management believes are not indicative of the intrinsic operating performance of the Company. It may be expressed in dollars or as a percentage of net revenue. The measurement is used by Management to evaluate our performance. Reconciling items to arrive at adjusted gross margin are also considered in the calculation of adjusted operating margin; and reconciling items to arrive at adjusted operating margin are also considered in the calculation of adjusted net earnings. Such reconciling items are more fully described in the Companys annual report on Form 10-K and its quarterly reports on Forms 10-Q.Adjusted earnings per share is adjusted net earnings divided by the weighted average diluted shares outstanding for a period, adjusted for the effect of reconciling items, if applicable, on the diluted weighted average shares outstanding. For example, some potential common shares which are anti-dilutive to the computation of GAAP earnings per share may be dilutive after considering reconciling items.Free cash is cash generated from operations in excess of our capital expenditure needs and net of proceeds from the sale of assets. Management uses this measure to evaluate our ability to fund acquisitions, repay debt, and otherwise enhance stockholder value through stock buy-backs or dividends.Cash available to enhance stockholder value is free cash less cash paid for acquisitions (including acquisition-related restructuring) and less debt principal payments. While internal growth and targeted acquisitions also enhance stockholder value through the generation of free cash, Management uses this measure to evaluate our ability to fund further enhancements to stockholder value, such as stock buy-backs or dividends.EBITDA is earnings before interest income and expense, provision for income taxes, depreciation expense, and amortization expense. Management believes that EBITDA provides additional information with respect to a companys performance and ability to meet its future capital expenditures and working capital requirements, particularly when evaluating acquisition targets.Adjusted EBITDA is EBITDA adjusted for relevant reconciling items used to calculate adjusted net earnings (described above). Adjusted EBITDA is substantially similar to, but not identical to, a measure used in the calculation of financial ratios required for covenant compliance under Vishays revolving credit facility.EBITDA Margin is adjusted EBITDA divided by net revenues.Breakeven point represents the quantity of output where total revenues and total operating costs are equal (in other words, where the operating income is zero). Management uses this measurement in evaluating our cost structure.Contribution margin, sometimes referred to as variable margin, is calculated as net revenue less costs that vary with respect to quantity produced (or another output-related driver). It may be expressed in dollars or as a percentage of net revenue. Management uses this measure to determine the amount of profit to be expected for any increase in revenues in excess of the break-even point.

Measurements excluding VPG reflect the historical businesses which are still part of Vishay today. The Company spun-off VPG on July 6, 2010. While VPG does not qualify as a discontinued operation under GAAP, Management believes that certain evaluations excluding VPG are meaningful, particularly when evaluating growth and other performance metrics. Historical VPG data is reported as a separate operating segment in Vishays annual report on Form 10-K and its quarterly reports on Forms 10-Q during the periods it was included in Vishays consolidated financial statements: This discrete data is the basis to calculate any measurements excluding VPG. These measures do not have uniform definitions and accordingly, these measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Such measures should not be viewed as alternatives to GAAP measures of performance or liquidity. However, Management believes such measures are meaningful to an evaluation of our business, as described above.


3

Intensified organic growth.Supplemented by targeted acquisitions.

Regular cash dividend program.

Opportunistic stock buy-backs.

Maintaining prudent capital structure.

DRIVE STOCKHOLDER VALUE


4

Broad and competitive product and technology portfolio:Solution provider and valuable partner for customers.

Broad market penetration

Wide range of end markets.

Balanced geographic manufacturing footprint.

Right mix of sales channels.

Contribution margin of 45% plus.

Reliable generation of free cash.

VISHAY TODAY


5

BALANCED PRODUCT PORTFOLIO

VISHAY REVENUES 2017

53%

24% DIODES

11% INFRARED OPTO

18% MOSFETs

SEMICONDUCTORSPASSIVES47% PASSIVES

32% RESISTORS INDUCTORS

15% CAPACITORS


DIODES MOSFETs MAGNETICS

Diodes, Rectifiers MOSFETs

Infrared Compo-

nents

Opto-couplers LEDs

Aluminum, Ceramic

Power, Film,

Tantalum

Film, Power

SMD Resistors

Variable, Sensors

Magnetic Components

VISHAY AVX Bourns Broadcom Diodes Inc. Infineon KEMET KOA Murata Nichicon Nexperia ON Semi Panasonic Rohm Sharp ST Micro TDK/EPCOS Toshiba Yageo

SEMICONDUCTORS PASSIVE COMPONENTSOPTO CAPACITORS RESISTORS

6

BROADEST LINE OF DISCRETE SEMICONDUCTORSAND PASSIVE COMPONENTS

= Major PositionSource: Company estimates = Minor Position
Sheet1SEMICONDUCTORSPASSIVE COMPONENTSDIODESMOSFETsOPTOCAPACITORSRESISTORSMAGNETICSDiodes, RectifiersMOSFETsInfrared Compo-nentsOpto-couplersLEDsAluminum, CeramicPower, Film, TantalumFilm, PowerSMD ResistorsVariable, SensorsMagnetic ComponentsVISHAYAVXBournsBroadcomDiodes Inc.InfineonKEMETKOAMurataNichiconNexperiaON SemiPanasonicRohmSharpST MicroTDK/EPCOSToshibaYageo


7

7% EMS

23% AMERICAS

42% ASIA

28% AUTOMOTIVE

8% COMPUTING

BROAD MARKET PENETRATION VISHAY TODAY

END MARKETS

VISHAY REVENUES 2017

4% MEDICAL

5% MILITARY/AERO

6% POWER SUPPLIES

36% INDUSTRIAL

6% CONSUMER

7% TELECOM

35% EUROPE

GEOGRAPHY

36% OEM

SALES CHANNELS

57% DISTRIBUTION


24% 36%

15%

28% 21%

8% 10%

6% 12% 7%

9% 6% 6% 5% 3% 4%

2010 2017

8

WELL-POSITIONED TO CAPITALIZE ON GROWTH MARKETS

VISHAY TODAY

2015-2017 revenue CAGR Auto: 10%

Industrial: 8%

Revenue split (by end market)

Automotive

Industrial

Consumer

Computing

Telecom

MedicalMilitary/Aero

Power supplies

Automotive

Industrial

Consumer

Computing

Telecom

MedicalMilitary/Aero

Power supplies


9

BROAD CUSTOMER BASE

OEM

EMS DISTRIBUTION

NO SINGLE OEM CUSTOMER REPRESENTS OVER 7% OF SALES


$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

03 04 05 06 07 08 09 10 11 12 13 14 15 16 17

OPERATING MARGIN REVENUE

OMMILLIONS

REVENUEMILLIONS

-1,677 -49

10

REVENUE AND GAAP OPERATING MARGIN1

1) Excl. VPG spin-off in 2010.

VISHAY TODAY


$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$0

$500

$1,000

$1,500

$2,000

$2,500

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$3,500

$4,000

$4,500

03 04 05 06 07 08 09 10 11 12 13 14 15 16 17

OPERATING MARGIN REVENUE

OMMILLIONS

REVENUEMILLIONS

11

REVENUE AND ADJUSTED OPERATING MARGIN1


VISHAY TODAY


12

RECONCILIATION OF GAAP TO ADJUSTED1VISHAY TODAY


in millions USD 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003

Reconciling items affecting gross margin:Loss on purchase commitments, Ta write-downs 6 16 (1) 17 18

Product quality claims 3 Reconciling items affecting operating margin:Restructuring and severance costs 11 19 19 21 3 36 57 15 38 27 46 29

Asset write-downs 1 5 4 7 11 27 1

U.S. pension settlement charges 79 16

Executive compensation charges (2) 6

Settlement agreement gain (28)

Executive employment agreement charge 58 Impairment of goodwill and indefinite-lived intangibles 2 63 1,629

Terminated tender offer expenses 4

Contract termination charge 19

Siliconix transaction-related charges 4

Purchased in-process R&D 10 2

Environmental remediation 4

Gain on sale of building (12) (5) (3)


0

5

10

15

20

25

30

35

40

45

50

55

60

0

5

10

15

20

25

30

35

40

45

50

55

60

03 04 05 06 07 08 09 10 11 12 13 14 15 16 17

%%

13

CONTRIBUTIVE MARGIN1VISHAY TODAY



$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

03 04 05 06 07 08 09 10 11 12 13 14 15 16 17PROCEEDS FROM SALE OF PROPERTY AND EQUIPMENTCASH FLOWS FROM OPERATIONS LESS CAPITAL EXPENDITURES 14

STRONG GENERATION OF FREE CASH VISHAY TODAY


15

$150 million stock repurchase program. Announced August 2, 2017; authorized until June 1, 2018.

In 2017 spent $39.9 million to repurchase 2.3 million shares.

In 2016 spent $23.2 million to repurchase 1.8 million shares.

From 2010 2012 spent $575 million to repurchase 44.3 million shares, financed with 2.25% coupon, 30-year convertibles.

ENHANCING STOCKHOLDER VALUE:$150 MILLION STOCK BUY BACK PROGRAM

VISHAY TODAY


16

Initiation of Companys quarterly cash dividend program:

Increased quarterly dividend by 26% to $0.0850 Q2 2018.



Initiated quarterly cash dividend of $0.0600 in Q1 2014.

Future dividends are subject to Board approval.

ENHANCING STOCKHOLDER VALUE:ANNUALIZED CASH DIVIDEND $0.34

VISHAY TODAY


Vishay is well positioned to participate in the markets expected to show solid growth over the next years.

Connectivity

Mobility

Sustainability

17

GROWTH DRIVERS


18

CONNECTIVITY INTERNET OF THINGS BLE BEACONS

GROWTH DRIVERS

Ultra low power Smallest dimensions Infinite life

Smart load switches

MOSFETs:miniature packages Low profile, small size, high CV

tantalum and polymer capacitors

ENYCAPTMhybrid EDLC

Chip antennas IHLP, IHHP for boost circuits

220EDLC ENYCAPTMradial high pulse


Low profile High efficiency Small solution size High power density

19

CONNECTIVITY SET-TOP BOXES

PowerPAKMOSFETs

TMBS diodes BUS-port protection arrays IHLP inductors IR receivers

icroBuckTMregulator ICs

GROWTH DRIVERS

HI Q HIFREQ MLCCs for RF circuit tuning

2018 VISHAY INTERTECHNOLOGY, INC. ALL RIGHTS RESERVED.20

Ultra fast diodesFRED Pt Gen 4

High efficiency Excellent stability and overload performance High operating temperature

MOBILITYCHARGE STATION OFF-BOARD

High voltage MOSFETs

Safety X cap & Y cap

Power Metal Stripcurrent sense resistors

Diodes moduleFilm capacitors for snubber

Snap-in electrolyticcapacitors

GROWTH DRIVERS

2018 VISHAY INTERTECHNOLOGY, INC. ALL RIGHTS RESERVED. 21

MOBILITY ON-BOARD BATTERY CHARGER

High efficiency Small size and weight Fast charging time

Customized MOSFETmodules

MKP DC-Link filmcapacitors

600 V / 1200 V Ultrafast rectifiers

Thin film SMD chipsand MELF


Pulse-proof thick film chip resistors

Leaded ceramic capacitorsclass Y2

Interference film capacitors

class X2 / Y2

GROWTH DRIVERS

Customized power magnetic modules

Automotive low voltageMOSFETs n & p channel
http://www.google.com.hk/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=Z222t86AsxetTM&tbnid=WjwQaSbf71yC1M:&ved=0CAYQjRw&url=http://www.plugincars.com/faster-level-2-charging-key-mass-ev-adoption-127070.html&ei=FscsU-_VE8jYigfswoC4Dg&psig=AFQjCNFFpr1UFz9e0uduUdOzOnZksJSwMA&ust=1395529839650865http://www.google.com.hk/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=Z222t86AsxetTM&tbnid=WjwQaSbf71yC1M:&ved=0CAYQjRw&url=http://www.plugincars.com/faster-level-2-charging-key-mass-ev-adoption-127070.html&ei=FscsU-_VE8jYigfswoC4Dg&psig=AFQjCNFFpr1UFz9e0uduUdOzOnZksJSwMA&ust=1395529839650865


22

SUSTAINABILITYON-PANEL POWER CONVERSION:

MICRO INVERTERS

GROWTH DRIVERS

Long life, high reliability Compact size Optimized efficiency High power density

Low ESR tantalum capacitors

MLCC capacitors

Film capacitors forsafety, snubber, and buffer applications TMBS Schottky

and Hyperfast diodesMOSFETs: PowerPAK 1212, SO8, 8x8

E series high voltage superjunction


IHLP inductors

Optocouplers andsolid-state relays


23

SUSTAINABILITYPOWER TRANSMISSION AND DISTRIBUTION

GROWTH DRIVERS

High voltage capability Long life Custom design

MELF resistorsfor high voltage detection

High power resistors for braking, dumping, and

groundingPhase-leg thyristors,SCR / IGBT modules Power capacitors

Optocouplers andsolid-state relays


TARGETS AND PROJECTIONS


25

Increase EPS

Organic growth.

Acquisitions.

Focus on maintaining prudent financial structure.

Concrete Growth Plan built business by business from the bottom up.

GOALSGROWTH PLAN


26

DRIVE ORGANIC GROWTH

Strong organic growth strategy

Focused development

of new products & technologies

Ensure product availability for key

product lines during demand spikes

Asia Growth Plan: Improve market

penetration mainly in industrial and auto

segments

GROWTH PLAN


27

Focus areas of new product development: MOSFETs: continued product rejuvenation in all voltage ranges,

extension of Automotive offerings and new packages. DrMOS with additional features and further integration steps. New low profile packaged diodes, new load dump TVS products. Further diversification in custom magnetics, power inductors and

planar transformers. Extended ranges of shunt resistors, precision and power resistors. New ranges of optical sensors incl. in-house designed ICs. Low ESR and high performance polymer tantalum capacitors. Customized DC-link and power film capacitors. Extension of Double Layer (EDLC) capacitor range.

1. FOCUSED DEVELOPMENT OF NEW PRODUCTSGROWTH PLAN


28

Leverage in Asia Vishays strength in automotive and industrial, in addition to the traditional Asian focus markets, computing and consumer:

Transportationautomotive (local customers), trains.

Energyinfrastructure, wind and solar, oil exploration.

Equipment and instrumentation.By a strong technical sales force in Asia with focus on China.

18% CAGR for Automotive in Asia 2012 2017.

2. ASIA GROWTH PLAN:IMPROVE MARKET PENETRATION IN INDUSTRIAL

AND AUTO

GROWTH PLAN


29

Get ahead of demand curve for Vishays strategic growth products to ensure sufficient capacity during demand spikes.

Diodes in smaller and lower profile packages.

Load dump TVS diodes, surface mount rectifiers.

High-current power inductors.

SMD couplers and optoelectronic sensors.

Shunt, and other specialty resistors.

Tantalum capacitors in face down style, polymer technology.

3. ENSURE PRODUCT AVAILABILITY FOR KEY PRODUCT LINES

GROWTH PLAN


30

Stable economic environment.

ASP decline per year for Vishays products:Passives 0% - 3%Semis 3% - 5.5%,

product line specific.

Inflation rates for salaries, wages and overhead:1.5% - 9.0%, location specific.

Stable FX rates.

ASSUMPTIONSGROWTH PLAN


31

Contributive margin at historical levels of 45% +

As consequence of price decline, cost reduction and mix development by specific product line.

Proven track record for last 10 + years of 45% + margin.

Fixed cost increases per year:

Selling, R&D and engineering costs 3%

G&A and manufacturing fixed costs 2%

Depreciation & Amortization - 1.2%

OPERATIONAL PARAMETERSGROWTH PLAN


32

Three types of small to mid-size acquisitions targeted:

Synergetic.

Specialty.

Closing technological gap.

Cash payback incl. restructuring of 8 years.

Accretive to earnings in less than 12 months.

SUPPLEMENT ORGANIC GROWTH WITH ACQUISITIONS

GROWTH PLAN


33

Grow at least with the market with CAGR of revenues of

between 3% and 6%.

Grow net income with CAGR of 10% to 20%.

Maintain prudent capital structure.

Continued strong generation of cash available to

enhance stockholder value.

IN SUMMARY


FINANCIAL RESULTSQ2 2018


HIGHLIGHTS Q2 2018Q2 FINANCIAL INFORMATION

Revenues Q2: $761 million. Gross margin Q2: 29.9%. Operating margin Q2: 16.2%. EPS Q2: $0.65; adjusted EPS: $0.54. Guidance Q3: Revenues $755 to $795 million and gross margins of

29.0%-30.0%, based on Q2 x-rates.

Repatriated $274 million net of related foreign taxes. 28% normalized effective tax rate expected for 2018 (31% in Q1 2018).

Distribution: Inventory turns worldwide of 3.7. Point of Sales worldwide for Q2 2018 increased by 14% year over year.


$600 CONVERTIBLE NOTES DUE 2025ISSUED JUNE 2018

Q2 FINANCIAL INFORMATION

$600 million principal amount of 2.25% converts, due 2025. All net proceeds used to repurchase $220 million principal amount of 2040

and of $69 million principal amount of 2042 converts.

Lower tax rate, increased average conversion price (= lower sharecount for EPS), higher interest.

Principal Amount

in million

Annual Cash Interest

in million

Conversion Price

Average Conversion

Price Convertible Debentures,due 2040 $275 $6 $12.91 Convertible Debentures, due 2041 $150 $3 $17.69 Convertible Debentures, due 2042 $150 $3 $10.98

Convertible Debt Instruments,due 2040 to 2042 $575 $13 $13.65 Convertible Notes, due 2025 $600 $14 $31.49 Convertible Debentures, due 2040 $55 $1 $12.86 Convertible Debentures, due 2041 $150 $3 $17.63 Convertible Debentures, due 2042 $81 $2 $10.94

Convertible Debt Instruments,due 2025 to 2042 $886 $20 $26.11

1) Annual cash interest rate for all converts 2.25%

as of March 31, 2018

as of June 30, 2018

Convertible Debt Instruments
Sheet1Convertible Debt Instruments Principal Amountin millionAnnual Cash Interestin millionConversion PriceAverage Conversion Priceas of March 31, 2018 Convertible Debentures,due 2040$275$6$12.913550.25 Convertible Debentures, due 2041$150$3$17.692653.5 Convertible Debentures, due 2042$150$3$10.981647Convertible Debt Instruments,due 2040 to 2042$575$13$13.65$13.65as of June 30, 2018 Convertible Notes, due 2025$600$14$31.4918894 Convertible Debentures, due 2040$55$1$12.86707.3 Convertible Debentures, due 2041$150$3$17.632644.5 Convertible Debentures, due 2042$81$2$10.94886.14Convertible Debt Instruments,due 2025 to 2042$886$20$26.11$26.111) Annual cash interest rate for all converts2.25%


NORMALIZED EFFECTIVE TAX RATE 28%Q2 FINANCIAL INFORMATION

Following the US tax reform, Vishays normalized effective tax rate was expected in Q1 to be 31% for the year.

Due to the unusual tax benefit related to the settlement of some of the converts, US GAAP tax rate was -6% for Q2 and 12.5% YTD.

The normalized effective tax rate excluding this and other unusual tax items was approximately 28% YTD, resulting for Q2 in a rate of 25%.

The normalized effective rate for the full year is expected to be 28%.

Our consolidated effective tax rate is based on an assumed level and mix of income among our various taxing jurisdictions. A shift in income could result in significantly different results.


CASH REPATRIATION AND RELATED FOREIGN TAXQ2 FINANCIAL INFORMATION

Plan to repatriate approximately $1.2 billion of cash withforeign withholding and other taxes of approximately $225 million.

Q2 2018 received $274 million in the USUsed to pay down revolver, intercompany debts and US transition tax.

In 2018 expect to pay $164 million in related foreign taxesimpacting cash flow from operations.

in millionGross amount

repatriatedForeign withholding

& other taxes Net cash to US

$1,200 $225 $975

Q2 2018 $366 $92 $274

Q3 2018 $522 $72 $450

2019 and later $312 $61 $251

1) All future amounts stated are approximations, subject to exchange rate changes.
Presentationin millionGross amount repatriatedForeign withholding & other taxesNet cash to USStatus$1,200$225$975PlannedQ2 2018$366$92$274CompleteQ3 2018$522$72$450Planned2019 and later$312$61$251Planned1) All future amounts stated are approximations, subject to exchange rate changes.$1,200$225$975RepatriationCash repatriationin millionAmount to be repatriated resp. repatriatedForeign tax withholdingAmount net of tax$1,200$225$975Q2 2018$366$92$274366Q3 2018$520$72$4505202019, 2020 and later$310$60$250150160Amount repatriated resp. to be repatriated$1,200$225$9751196Repatriation of cash related to TCJA as disclosed in June 10-QTotal (incl. foreign tax)Foreign tax%Amount repatriated resp. to be repatriated1,200,000225,00019%Net of tax975,000Q2366,10092,10025%Q3 519,40071,40014%274,0002019130,80022,80017%448,0002020 and later152,00037,10024%108,000114,900Subtotal1,168,300223,40019%944,900Use of cashUse of cash related to repatriation as disclosed in June 10-QASSUMING FOREIGN TAXES ARE CASH TAXESQ1-Q2TCJA transition tax14,0001st installment ($180 mm total, payable over 8 years)Q2Foreign tax related to repatriation94,000Q3Foreign tax related to repatriationQ4TCJA transition tax14,800$28.8 mm in 2018 (of which $14.0 mm in Q1)Total 2018122,8002019TCJA transition tax28,8802019Foreign tax related to repatriationTotal 201928,880Disclosed in 10QMissing informationCalculated #s will change based on missing information added.


CASH FLOW IMPACTED BY CASH REPATRIATIONQ2 FINANCIAL INFORMATION

in millions Q2 2018 TTM Q2 2018 Year 2017

Depreciation $37 $151 $149

Amortization $3 $13 $14

U.S transition tax ($14) ($14) Repatriation taxes ($92) ($92)

Cash from operations ($9) $279 $369

CapEx $48 $198 $170

Free Cash* ($49) $89 $200 * Cash flows from operations less capital expenditures plus proceeds from sale of property and equipment

BOTH Q2 AND TTM Q2 INCLUDE ABOUT $106 MILLION CASH TAXES RELATED TO CASH REPATRIATION AND US TAX REFORM.
Sheet1 in millionsQ2 2018TTM Q2 2018Year 2017Depreciation $37$151$149Amortization$3$13$14 U.S transition tax($14)($14) Repatriation taxes($92)($92)Cash from operations($9)$279$369CapEx$48$198$170Free Cash*($49)$89$200* Cash flows from operations less capital expenditures plus proceeds from sale of property and equipment


SHARECOUNT FOR EPS CALCULATIONQ2 FINANCIAL INFORMATION

The three converts issued 2010-12 become dilutive once the average stock price is higher than the lowest conversion price:For an average stock price below $10.94 there is no dilution due to the converts.The table to the right summarizes the approximate number of shares for diluted EPS calculation.

See Item 7.01 of current report on Form 8-K filed with the Securities and Exchange Commission on August 7, 2018 for additional important information about the parameters which impact the computation of shares expected to be used in the diluted EPS computation.

Average Stock Price

Projected Diluted Shares

$12.00 145$13.00 146$14.00 147$15.00 147$16.00 148$17.00 149$18.00 149$19.00 150$20.00 151$21.00 151$22.00 152$23.00 153$24.00 153$25.00 154$26.00 154$27.00 155$28.00 155$29.00 155$30.00 156$31.00 156$32.00 156$33.00 157$34.00 158$35.00 159

in million

Total shares outstanding 144Related to RSUs etc. < 1


41

SALES SPLIT Q2 2018

5% CONSUMER

END MARKETS

7% COMPUTING

6% TELECOM

4% MEDICAL 5% MILITARY/AERO

6% POWER SUPPLIES

39% INDUSTRIAL

28% AUTOMOTIVE

40% ASIA

36% EUROPE

24% AMERICAS

GEOGRAPHY

7% EMS

35% OEM

SALES CHANNELS

58% DISTRIBUTION



APPENDIX



QUARTERLY FINANCIAL RESULTSQ2 FINANCIAL INFORMATION

in millions, except per share amounts Q2 2018 Q1 2018 Q2 2017*

Net revenues $761 $717 $643

Gross profit $227 $205 $174

29.9% 28.6% 27.0%

Operating income (loss) $123 $104 $85

16.2% 14.5% 13.2%

Net earnings (loss) attributable to Vishay stockholders $103 $62 $56

Weighted average shares outstanding for EPS 158 160 155

EPS $0.65 $0.39 $0.36

EBITDA $144 $138 $121

18.9% 19.3% 18.9%

*Recast for the retrospective adoption of ASUs 2014-09 and 2017-07


ADJUSTED QUARTERLY FINANCIAL RESULTSQ2 FINANCIAL INFORMATION

in millions, except per share amounts Q2 2018 Q1 2018 Q2 2017*

Net revenues $761 $717 $643

Gross profit $227 $205 $174

29.9% 28.6% 27.0%

Adjusted operating income $123 $104 $85

16.2% 14.5% 13.3%

Adjusted net earnings attributable to Vishay stockholders $86 $64 $55

Weighted average shares outstanding for adjusted EPS 158 160 155

Adjusted EPS $0.54 $0.40 $0.36

Adjusted EBITDA $161 $138 $122

21.2% 19.3% 19.0%



45

in millions Q2 2018 Q1 2018 Q2 2017*GAAP NET EARNINGS (loss) $103 $62 $56attributable to Vishay stockholders

Reconciling items affecting operating incomeRestructuring and severance costs - - $1

Reconciling items affecting other income (expense)Gain on early extinguishment of debt 17 - -

Reconciling items affecting tax expense (benefit)Enactment of TCJAEffects of cash repatriation programChange in deferred taxes due to early extinguishment of debtTax effects of pre-tax items above

12($9)

($34)($4)

-$1

--

-($1)

--

ADJUSTED NET EARNINGS $86 $64 $55 attributable to Vishay stockholders

RECONCILIATION OF GAAP TO ADJUSTEDQ2 FINANCIAL INFORMATION



LONG TERM DEBTQ2 FINANCIAL INFORMATION

as of June 30, 2018

in millionsOutstanding

Debt Comments Interest

Long term incl. current portion $680

Revolving Debt $96 Available through December 10, 2020 LIBOR plus 1.50%

Convertible Notes, due 2025 $489

$600 million principal amount;debt discount of $111 million amortized to income

statement as additional non-cash interest

Cash coupon 2.25% of principal or $14 million annually;

GAAP interest expense (incl. amortization of discount) based on 5.5% of net carrying amount

Convertible Debentures, due 2040-2042 $114

$286 million principal amount;debt discount of $173 million amortized to income

statement as additional non-cash interest

Cash coupon 2.25% of principal or $6 million annually;

GAAP interest expense (incl. amortization of discount) based on 8.00%, 8.375% resp. 7.50% of

net carrying amount

Deferred Financing Costs ($19)
Sheet1 in millionsOutstanding DebtCommentsInterestLong term incl. current portion$680 Revolving Debt$96Available through December 10, 2020LIBOR plus 1.50% Convertible Notes, due 2025$489$600 million principal amount;debt discount of $111 million amortized to income statement as additional non-cash interest Cash coupon 2.25% of principal or $14 million annually; GAAP interest expense (incl. amortization of discount) based on 5.5% of net carrying amount Convertible Debentures, due 2040-2042$114$286 million principal amount;debt discount of $173 million amortized to income statement as additional non-cash interest Cash coupon 2.25% of principal or $6 million annually; GAAP interest expense (incl. amortization of discount) based on 8.00%, 8.375% resp. 7.50% of net carrying amount Deferred Financing Costs($19)


BOOK-TO-BILL DETAILQ2 FINANCIAL INFORMATION

Q2 2018 Q1 2018 Q4 2017 Q3 2017 Q2 2017

Book-to-bill VISHAY 1.17 1.22 1.28 1. 11 1. 27

Book-to-bill distribution 1.23 1.28 1.40 1.15 1.43

Book-to-bill OEMs 1.08 1.16 1.13 1.06 1.06

Book-to-bill semiconductors 1.06 1.26 1.40 1.13 1.34

Book-to-bill passive components 1.29 1.18 1.15 1.09 1.20

Book-to-bill Americas 1.29 1.25 1.14 1.04 1.19

Book-to-bill Asia 1.09 1.22 1.40 1.15 1.38

Book-to-bill Europe 1.18 1.23 1.23 1.12 1.20


OPERATIONAL METRICSQ2 FINANCIAL INFORMATION

Q2 2018 Q1 2018 Q4 2017* Q3 2017* Q2 2017*

Change in ASP vs. prior year total Vishay 0.7 (0.9) (2.3) (2.4) (2.8)

Change in ASP vs. prior year semis 1.0 (0.8) (2.7) (2.7) (3.4)

Change in ASP vs. prior year passives 0.3 (0.9) (1.9) (2.1) (2.1)

FX effect on revenues vs. previous quarter ($7) $10 $1 $13 $6

Backlog at quarter end $1,595 $1,499 $1,320 $1,122 $1,034

Backlog in months 6.3 6.3 5.9 5.0 4.8



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SALES GM %

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VISHAY REVENUES AND GROSS MARGIN % QUARTERLY


excl. Spin-Off Vishay Precision Group in 2010


VISHAY REVENUES QUARTERLYBY PRODUCT SEGMENT


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VISHAY REVENUES YEARLYBY PRODUCT SEGMENT



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VISHAY GROSS MARGINS QUARTERLYBY PRODUCT SEGMENT



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VISHAY GROSS MARGINS YEARLYBY PRODUCT SEGMENT

INVESTOR PRESENTATIONSlide Number 2DRIVE STOCKHOLDER VALUE Vishay todayBALANCED PRODUCT PORTFOLIOBROADEST LINE OF DISCRETE SEMICONDUCTORSAND PASSIVE COMPONENTSBROAD MARKET PENETRATION Well-positioned to capitalize on growth marketsBROAD CUSTOMER BASEREVENUE AND GAAP OPERATING MARGIN1REVENUE AND ADJUSTED OPERATING MARGIN1Reconciliation of GAAP to Adjusted1CONTRIBUTIVE MARGIN1STRONG GENERATION OF FREE CASH ENHANCING STOCKHOLDER VALUE:$150 Million Stock buy back programENHANCING STOCKHOLDER VALUE:Annualized Cash dividend $0.34Growth drivers CONNECTIVITY internet of things ble beacons CONNECTIVITY SET-TOP BOXESSlide Number 20 MOBILITY ON-BOARD BATTERY CHARGER SUSTAINABILITYON-PANEL POWER CONVERSION: MICRO INVERTERS SUSTAINABILITY Power TRANSMISSION AND DISTRIBUTIONTARGETS AND PROJECTIONSgoalsDRIVE ORGANIC GROWTH1. Focused development of new Products 2. asia growth plan:IMPROVE MARKET PENETRATION in industrial and auto3. Ensure product availability for key product lines Assumptionsoperational parametersSupplement organic growth with ACQUISITIONSIN SUMMARYFINANCIAL RESULTSHIGHLIGHTS Q2 2018$600 Convertible notes due 2025issued June 2018Normalized effective tax rate 28%Cash repatriation and related foreign taxCASH FLOW IMPACTED BY CASH REPATRIATION SHARECOUNT FOR EPS CALCULATIONSALES SPLIT Q2 2018 APPENDIXQUARTERLY financial resultsAdjusted QUARTERLY financial resultsReconciliation of GAAP to AdjustedLONG TERM DEBTBOOK-TO-BILL DETAILOPERATIONAL METRICSVISHAY REVENUES AND GROSS MARGIN % QUARTERLYVISHAY REVENUES QUARTERLYBY PRODUCT SEGMENTVISHAY REVENUES YEARLYBY PRODUCT SEGMENTVISHAY GROSS MARGINS QUARTERLYBY PRODUCT SEGMENTVISHAY GROSS MARGINS YEARLYBY PRODUCT SEGMENT

investor presentation - ir.vishay.com · 2015. 2014: 2013. 2012: 2011. 2010: 2009. 2008: 2007....

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