Vishay Intertechnology
Annual Report 2007

Plain-text annual report

Annual Report 2007 Vishay Intertechnology, Inc. One of the World’s Largest Manufacturers of Discrete Semiconductors and Passive Components Financial Highlights Net sales $ in millions 3,000 – 2,500 – 2,000 – 1,500 – 1,000 – 500 – 0 Operating Profit* $ in millions Income from Continuing Operations* $ in millions 300 – 200 – 100 – 0 05 $95.8 06 07 $209.2 $218.4 300 – 200 – 100 – 0 05 $62.3 06 07 $139.7 $140.4 Operating Profit, Adjusted** $ in millions Income from Continuing Operations, Adjusted** $ in millions 300 – 200 – 100 – 0 05 06 $2,296.5 $2,581.5 $2,833.3 07 05 06 $149.5 $277.9 $252.8 07 300 – 200 – 100 – 0 05 $92.9 06 07 $196.1 $181.5 The following table reconciles amounts as reported to the adjusted operating profit and adjusted net earnings presented in the charts above. (in millions) *As reported Restructuring and severance costs Asset write-downs Contract termination charge Inventory write-downs and loss (gain) on purchase commitments Purchased research and development Siliconix transaction related expenses Other Net tax benefit of reconciling items **Adjusted Operating Profit 2006 $ 209.2 40.2 6.7 — 2007 $ 218.4 14.7 3.9 18.9 2005 $ 95.8 29.8 11.4 — Income From Continuing Operations 2007 2006 $ 140.4 $ 139.7 40.2 6.7 — 14.7 3.9 18.9 2005 $ 62.3 29.8 11.4 — — 15.3 (1.0) — 15.3 (1.0) — — (3.1) — $ 252.8 — — 6.5 — 9.7 3.8 — — $ 277.9 $ 149.5 — — 5.2 (1.6) — — 9.3 (15.1) $ 181.5 $ 196.1 9.7 3.8 (11.1) (12.0) $ 92.9 Measurements such as adjusted operating profit and adjusted income from continuing operations are not recognized in accordance with generally accepted accounting principles (GAAP) and should not be viewed as an alternative to GAAP measures of performance. Management believes that adjusted operating profit and adjusted income from continuing operations, “non-GAAP” measures, are meaningful to investors because they provide insight with respect to intrinsic operating results of the Company. Reconciling items to arrive at adjusted operating profit and adjusted income from continuing operations represent significant charges or credits that are important to an understanding of the Company’s intrinsic operations. These reconciling items are more fully described in the Company’s consolidated financial statements. www.vishay.com As of and for the year ended December 31 (in thousands, except per share amounts) Net revenues Operating income Net earnings Depreciation and amortization Basic earnings per share Diluted earnings per share Weighted average shares outstanding - basic Weighted average shares outstanding - diluted Cash flows from operations Working capital Property and equipment - net Long-term debt Stockholders’ equity 2007 2006 2005 $ 2,833,266 $ 2,581,477 $ 2,296,521 218,368 130,764 214,691 $ 0.70 $ 0.69 185,646 198,226 $ 354,012 1,145,873 1,220,998 607,237 209,200 139,736 196,963 $ 0.76 $ 0.73 184,400 210,316 95,759 62,274 188,900 $ 0.35 $ 0.34 177,606 189,321 $ 349,466 $ 202,874 1,192,833 1,124,365 608,434 1,136,466 1,090,592 751,553 $ 3,356,775 $ 3,080,813 $ 2,855,852 About Vishay Vishay is one of the world’s largest manufacturers of discrete semiconductors and passive electronic components. These components are used in virtually all types of electronic devices and equipment, in the industrial, computing, automotive, consumer, telecommunications, military, aerospace, and medical markets. Vishay’s global footprint includes sales offices worldwide, as well as manufacturing plants in China and five other Asian countries, Europe, and the Americas. Vishay has market shares ranging from substantial to number one for each of its products. Its product innovations, successful acquisition strategy, focus on cost reductions, and ability to provide “one-stop shop” service have made Vishay a global industry leader. About the Cover Vishay Intertechnology, Inc. The individual product images on the front cover are samples of Vishay’s broad product portfolio. (The products are not shown to scale.) In the background are enlarged images of silicon wafers used in semiconductor manufacturing. V i s h a y I n t e r t e c h n o l o g y , I n c . A n n u a l R e p o r t 2 0 0 7 Annual Report 2007 Vishay Intertechnology, Inc. Discrete Semiconductors and Passive Components Table of Contents Letter from the Executive Chairman and CEO Semiconductors Passive Components The Vishay Story Vishay Serves Diverse Markets Financial Summary Product List Form 10-K 2 4 5 6 8 10 12 Corporate Information inside back cover Vishay Intertechnology 1 Letter from the Executive Chairman and CEO Year 2007 was one of the most successful years in Vishay’s history. Revenues for 2007 were an all-time record. Our adjusted earnings per share in 2007 were in the same range as 2006. We invested significantly in expansion and reduced costs during 2007. In addition, we successfully integrated the discrete semiconductor product lines from our acquisition of the Power Control Systems (PCS) business of International Rectifier®. While we are very pleased with our results during 2007, the general economic outlook for 2008 is not good, and most analysts are predicting a bleak year. At the moment, we have no more than three months’ visibility at best. However, Vishay is prepared to move quickly with any needed corrections. Year 2007 Vishay’s revenues for 2007 were $2.83 billion, an increase of 9.8% compared to 2006. Adjusted earnings per share for 2007 were $0.95, compared to $0.99 in 2006. The adjustments are associated with restructuring and severance costs, related asset write-downs, a contract termination charge, and other items. (For more details about the adjustments, see the table on the inside front cover.) During 2007, cash generated from continuing operations was $354 million, compared to $349 million during 2006. In April 2007, Vishay completed its acquisition of the PCS business of International Rectifier, which included selected discrete semiconductor and module product lines. These generate annualized sales of approximately $240 million. The PCS acquisition also included the Automotive Modules and Subsystems Business Unit (ASBU). Vishay has announced that, because the ASBU business does not satisfactorily complement Vishay’s operations and does not provide potential synergies, Vishay intends to sell it. Currently, Vishay is in negotiations with interested parties. Vishay also acquired the on-board weighing systems business of PM Group during 2007. This was part of Vishay’s ongoing series of acquisitions to vertically integrate its Measurements Group business, which includes resistance strain gages (in which Vishay is the worldwide leader), transducers (the metallic structures to which strain gages are cemented), electronic instruments that measure and control output of the transducers, and complete systems for process control and on-board weighing applications. Vishay’s capital spending during 2007 was $200 million. More than 50% of this was for capacity expansion, primarily for discrete semiconductors. In the area of passive components, Vishay added capacity only for specialty products. These included face-down tantalum chip capacitors that feature 2 Vishay Intertechnology Vishay’s proprietary multi-array packaging (MAP) technology and film power capacitors. In November 2007, Vishay received two awards from the National Electronic Distributors Association (NEDA). Vishay was the first company to win awards for both Active Component Manufacturer of the Year and I, P, and E (Interconnect, Passive, and Electromechanical) Component Manufacturer of the Year. Vishay’s research and development (R&D) efforts are on target, and the share of new products released to the market continues to increase. Below are just a few examples of new product platforms and new products released by Vishay in 2007: • MOSFETs based on a new version of Vishay’s TrenchFET® technologies that sets a new record for lowest on-resistance per unit area for p-channel load switching devices and provides the highest efficiency for n-channel PWM switching devices. Both types of devices reduce power losses, extend battery run times, and increase functionality in portable end products • The MicroSMP™ miniature package for Schottky rectifiers and transient voltage suppressors that provides more power in a smaller package for consumer, telecommunications, automotive, and industrial applications • An industry-first 8-diode array in Vishay’s ultra-compact LLP leadless package that protects against electrostatic discharge while saving space in portable electronics for mobile computing, mobile communication, consumer, industrial, automotive, and medical applications • A series of compact infrared receiver modules with the industry’s highest sensitivity-to-size ratio that is designed for long-range operation in infrared remote control, data transmission, and light barrier applications • The industry-first HVArc Guard® series of multilayer ceramic chip capacitors that prevents surface arc-over at high voltages, thereby improving the reliability of lighting systems and power supplies for medical, computer, motor control, construction and mining, and telecommunications applications • A compact surface-mount resistor that uses Vishay’s patented Power Metal Strip® technology to provide precision current monitoring of sensitive circuits, such as automotive electronic controls including engine, transmission, and pollution controls • Ultra-high-precision Bulk Metal® foil resistors built on Vishay’s breakthrough Z- foil technology, which provides a significant reduction of the resistive component’s sensitivity to ambient temperature variations and applied power changes, and improves stability by an order of magnitude compared to any other resistor technology Vishay products recently were chosen as finalists for the prestigious EDN Innovations Awards and EE Times Annual Creativity in Electronics (ACE) Awards. Vishay products that received industry awards in 2007 and early 2008 include the following: • analogZONE Product of the Year award for Best Innovation in Load Switches: Vishay Siliconix SiP4280A and SiP4282 families of p-channel load switches • International CES Innovations Design and Engineering Award in the Enabling Technologies product category: SMS8021/RFW8021 UHF antenna chip, developed with Siano Mobile Silicon • EE Times / eeProductCenter Most Popular Product of 2007: Vishay HE3 wet tantalum high-energy capacitor • Electronic Products China Product of the Year: Vishay HE3 wet tantalum high-energy capacitor Financial Highlights Dr. Felix Zandman Executive Chairman of the Board Dr. Gerald Paul Chief Executive Officer in Asia. Vishay has manufacturing plants and sales offices in this region, and will continue to work closely with distribution partners to reach end customers. Net revenues for the year ended December 31, 2007 were $2,833.3 million compared to $2,581.5 million for the year ended December 31, 2006. Net earnings for the year ended December 31, 2007 were $130.8 million, or $0.69 per diluted share, compared with net earnings for the year ended December 31, 2006 of $139.7 million, or $0.73 per diluted share. Adjusted net earnings for 2007 and 2006 were $181.5 million and $196.1 million respectively, or $0.95 and $0.99 per diluted share. Free cash generation is a major focus at Vishay. We generated substantial amounts of free cash during 2007, and expect to do even better in 2008. During 2008, Vishay will continue to seek opportunities for cost reductions. As always, we will continue to focus on R&D, as new products are vital to the organic growth of Vishay. We also will continue to look for strategic acquisitions to enhance our product portfolio, enter new markets, and gain new customers. Vishay continued to generate cash from continuing operations during 2007. For the year ended December 31, 2007, the Company’s cash flow from operations was $354.0 million. Purchases of property and equipment for the year ended December 31, 2007 were $200.0 million, and depreciation and amortization for the year ended December 31, 2007 were $214.7 million. Free cash (net cash provided by operating activities minus capital expenditures) generated by Vishay in 2007 was $154.0 million, compared to $166.2 million in 2006. Our cash balance, including short-term investments, at December 31, 2007 was $537.3 million. At December 31, 2007, the long-term debt of Vishay was $607.2 million (substantially all in convertibles), and stockholders’ equity was $3,356.8 million, resulting in a debt-to-equity ratio of 0.18. Looking Ahead In 2008, Vishay will continue to leverage its position as a broad-line manufacturer of discrete semiconductors, passive components, and weighing and measurement products. We anticipate that semiconductor products from Vishay’s PCS acquisition will be a focus of new product development and provide synergies with existing Vishay products. The capacity expansion for semiconductors and specialty passive components that took place during 2007 will continue in 2008. As this will be done strategically, we anticipate that capital expenditures will be reduced by approximately 15% in 2008 compared to 2007. Vishay revenues in Asia during 2007 surpassed the one billion dollar mark. Year 2008 will provide new opportunities for sales Although the general economic outlook for 2008 is not good, Vishay’s business strategy has proven to be successful during past downturns in the global electronics industry. As we look ahead, we once again express our gratitude to Vishay’s employees, customers, vendors, and strategic business partners for their confidence in Vishay, and thank the Company’s shareholders for their support. Sincerely, Dr. Felix Zandman Executive Chairman of the Board Dr. Gerald Paul Chief Executive Officer Vishay Intertechnology 3 Semiconductors Discrete semiconductors (diodes, transistors, and optoelectronic components) typically perform a single function in electronic circuits, such as switching, amplifying, rectifying, and transmitting electrical signals. Semiconductors are referred to as “active” components because they require power to function. Siliconix MOSFETs Metal-oxide-semiconductor field-effect transistors (MOSFETs) function as solid-state switches to control power. For example, they turn off specific functions of notebook computers and cell phones when these functions are not in use, thereby extending battery life. They also help convert power into levels required by other components. Vishay offers low- and high-voltage Siliconix TrenchFET® and planar MOSFETs in innovative package formats to switch and manage power very efficiently. Integrated Circuits (ICs) Integrated circuits combine the functions of multiple semiconductor and passive components on a single chip. IC products from Vishay are focused on analog signal switching and routing, power conversion, and power management. They are used in end products such as notebook and desktop computers, cell phones, and fixed telecom systems. Switchmode and linear regulators, MOSFET drivers, bus interface devices, and analog switches and multiplexers are included in the Vishay IC portfolio. Vishay Semiconductors Rectifiers Diodes and Thyristors Rectifiers convert alternating current (AC) into direct current (DC), a unidirectional current required for operation of many electronic systems. For example, a bridge rectifier is used in a clock radio to change the AC voltage from a wall outlet to a specific DC voltage. Vishay’s patented TMBS™ rectifiers reduce power losses and improve efficiency in computing, telecommunications, and other applications. Diodes and thyristors are semiconductor components that allow voltage to be conducted in only one direction. Both types of devices are used in a wide range of electronic systems to route, switch, and block RF, analog, and power signals. The Vishay Semiconductors diode portfolio includes Schottky, switching, PIN, sinterglass, and rectifier devices as well as products for transient voltage suppression, ESD protection, and EMI filtering. RF Transistors Optoelectronics RF transistors amplify analog or digital signals. They are designed specifically to handle small-signal radio frequencies in the front ends of radios, television sets, mobile phones, and other devices to amplify antenna signals. Modules Modules and assemblies combine several components into a single package. For example, products in Vishay’s FunctionPAK® dc-to-dc converter family combine up to 20 devices in a single 15-mm by 15-mm package. Modules combining multiple diodes and thyristors address a host of applications from motor drives to line-frequency welding machines. Optoelectronic components emit light, detect light, or do both. Types include infrared data communications devices (IRDCs) for two-way data transfer, optocouplers and solid-state relays for circuit isolation, IR emitters and IR receivers for one-way remote controls (as used in television sets, for example), optical sensors for detection, LEDs for light sources, and 7-segment displays. Vishay’s extensive portfolio of semiconductors and passive components can be divided into five groups: Siliconix, Vishay Semiconductors, Resistors/Inductors, Capacitors, and Measurements Group. The pie chart on page 7 titled Revenue by Product Group 2007 shows the percentage of total Vishay revenue generated by each of these five groups. 4 Vishay Intertechnology Passive Components Passive components (resistors, capacitors, inductors, transducers) do not require a power supply to handle the signals that pass through them. They are used to store electrical charges, to limit or resist electrical current, and to help in filtering, surge suppression, measurement, timing, and tuning applications. Resistors/Inductors Resistive Products Magnetics Resistors restrict current flow. Vishay manufactures many different types of resistive products, including single (discrete) resistors based on foil, thin film, thick film, metal oxide film, carbon film, and wirewound technologies, as well as resistor networks and arrays, in which multiple resistors are combined in a single package. Vishay also manufactures thermistors and varistors, which suppress voltage increases due to temperature and voltage changes. Resistors are used in all electronic circuits. Inductors and transformers are categorized as magnetics. Inductors use an internal magnetic field to change AC current phase and resist AC current. Inductor applications include controlling AC current and voltage and filtering out unwanted electrical signals. Transformers (two inductors on a common core of magnetic material) increase or decrease AC voltage or AC currents. Capacitors Capacitors Capacitors store energy and discharge it when needed. Applications include power conversion, DC-linking, frequency conversion, bypass, decoupling, and filtering. Types of capacitors manufactured by Vishay include tantalum (both solid and wet), ceramic (both multilayer chip and disk), film, power, heavy-current, and aluminum, as well as high-performance, high-precision, silicon-based RF capacitors. Capacitors are used in almost all electronic circuits. Measurements Group Strain Gages and Instruments Transducers Strain gages are sensors used to detect stress and other physical forces. They are widely used in weighing, process control, force measurement, and other systems. Related instruments are used to measure, display, and record the information detected by strain gages. Systems Systems use transducers and instruments to control process weighing in food, chemical, and pharmaceutical plants. Force measurement systems are used to control web tension in paper mills, roller force in steel mills, and cable tension in winch controls. On-board weighing systems are installed in logging and waste-handling trucks. Special scale systems are used for aircraft weighing and portable truck weighing. Load-cell-type transducers measure weight. For example, in a digital bathroom scale, small strain gages are attached to a transducer that is hidden beneath the platform of the scale. A person’s weight pressing down on the transducer causes the strain gage to issue a signal to the electronic system that displays the weight in pounds or kilograms. PhotoStress® PhotoStress coatings and instruments use a unique optical process to reveal and measure the distribution of stresses in structures under live load conditions. They are used to improve structural design in aerospace, automotive, military, civil engineering, industrial, and medical applications. Vishay Intertechnology 5 Solutions for Weighing and Measurement Through acquisitions, Vishay’s original strain gage business has become the foundation of an extensive portfolio of products for weighing and measurement that includes resistance strain gages (in which Vishay is the worldwide leader), transducers (the metallic structures to which strain gages are cemented), electronic instruments that measure and control output of the transducers, and complete systems for process control and on-board weighing applications. Vishay manufactures customized systems for process control in paper mills, food processing plants, and other facilities worldwide. Vishay on-board weighing systems are used in the waste-handling, trucking, forestry, quarry and mining, and aerospace industries. Growth in Semiconductors In 1998, Vishay acquired the Semiconductor Business Group of TEMIC, which included Telefunken and 80.4% of Siliconix, producers of MOSFETs, RF transistors, diodes, optoelectronics, and power and analog switching integrated circuits. Vishay’s next semiconductor acquisition came in 2001, with the purchase of the infrared components business of Infineon Technologies. That was followed the same year by the acquisition of General Semiconductor, a leading global manufacturer of rectifiers and diodes. The addition of Infineon’s infrared components group and General Semiconductor enhanced Vishay’s existing Telefunken and Siliconix businesses and propelled Vishay into the top ranks of discrete semiconductor manufacturers. In 2005, Vishay purchased the remaining 19.6% of Siliconix shares. Vishay’s most recent semiconductor acquisition comprises selected discrete semiconductor and module product lines from International Rectifier. This acquisition has added manufacturing plants in Italy, China, and India and provided products that are new to Vishay: high-voltage planar MOSFETs and high-power diodes and thyristors. It further enhances Vishay’s market position in discrete semiconductors. Successful Strategy, Financial Strength Vishay’s focus on innovation and growth through acquisition has enabled it to remain financially strong during periodic downturns in the highly cyclical electronics industry. Vishay’s historically strong cash generation has provided money to acquire other companies and businesses. The result is a 20% compound annual growth rate of revenues during the past 20 years. In the process, Vishay has become a truly international company — a leader in the global electronics industry that sells into all geographic markets and all relevant market segments. The Vishay Story In the 1950s, patents were issued for the PhotoStress® products developed by Dr. Felix Zandman. These products reveal and measure stress distribution in airplanes, cars, and other structures under live load conditions. Dr. Zandman’s research in this area led him to develop Bulk Metal® foil resistors, still the most precise and stable resistors available. Dr. Zandman, with the financial support of Alfred P. Slaner, founded Vishay in 1962 to develop and manufacture Bulk Metal foil resistors. The Company was named after the village in Lithuania where relatives of Dr. Zandman and Mr. Slaner had perished during the Holocaust. The Company’s initial product portfolio consisted of foil resistors and foil resistance strain gages. Passive Component Acquisitions During the 1960s and 1970s, Vishay became known as the world’s leading manufacturer of foil resistors, PhotoStress products, and strain gages. Vishay’s subsequent decision to grow through acquisitions proved very successful. Starting in 1985, Vishay acquired resistor companies Dale Electronics, Draloric Electronic, and Sfernice. These acquisitions helped produce dramatic sales growth. In the early 1990s, Vishay applied its acquisition strategy to the capacitor market by purchasing Sprague Electric, Roederstein, and Vitramon. Vishay’s last major passive component acquisition was BCcomponents (former passive component businesses of Philips Electronics and Beyschlag). This 2002 acquisition greatly enhanced Vishay’s global market position. Vishay’s Sales Growth $3000 $2500 $2000 $1500 $1000 $500 $0 20% Compound Annual Growth Rate (CAGR) of Sales 1986 - 2006 Dollars in the millions 87 88 89 90 91 92 93 94 95 96 97 98 99 01 02 03 04 05 06 07 6 Vishay Intertechnology Meeting Customer Needs Growth through R&D Vishay’s customer mix includes original equipment manufacturers (OEMs), electronic manufacturing services (EMS) companies that manufacture for OEMs on an outsourcing basis, and distributors that, depending on their size, sell to end customers at an international, regional, or local level. Vishay’s global sales force includes direct field sales personnel, independent sales representatives, and field application engineers (FAEs). Vishay’s FAE team provides technical and applications support to customers. Its efforts focus on getting design engineers to include Vishay components in the new end products they are developing. When the FAEs highlight new Vishay components and seek to have them “designed in” to end products being developed by design engineers, they have at their disposal Vishay’s extensive product portfolio — one of the industry’s broadest. From a customer perspective, Vishay’s “one-stop shop” service for complete discrete component solutions provides key benefits: Customers are able to streamline their design and purchasing processes by ordering multiple types of components from Vishay. Customers can send their bills of materials to Vishay and ask that Vishay cross-reference Vishay products in all categories. In addition, Vishay’s product sample service for design engineers provides free product samples worldwide. Vishay generates a steady stream of new components to help designers create innovative end products — from ultra-thin notebook computers to implantable medical devices to advanced engine controls. While many Vishay products are commodity products, others are high-margin specialty products based on proprietary technology. Vishay’s mix of commodity and specialty products moderates the price erosion that is a fact of life in the electronics industry. Some leading Vishay products that are well established in the marketplace have been licensed by Vishay to other companies. Other industry-first Vishay products are still relatively new, and thus have significant potential to gain market share. One measure of Vishay’s successful ability to meet market demand is industry awards. Awards to Vishay in 2007 and early 2008 included the analogZONE Product of the Year award for Best Innovation in Load Switches, the International CES Innovations Design and Engineering Award in the Enabling Technologies category, the EE Times / eeProductCenter Most Popular Product of 2007, and the Electronic Products China Product of the Year award. Revenue by Product Group 2007 Revenue by Region 2007 Semiconductors 53% Passive Components 47% Siliconix 24% Measurement Group 7% Vishay Semiconductors 29% Capacitors 17% Resistors/Inductors 23% Asia 38% Americas 24% Europe 38% Industry Rankings Discrete Semiconductors Number 1 worldwide in low-voltage power MOSFETs Number 1 worldwide in rectifiers Number 1 worldwide in glass diodes Number 1 worldwide in infrared components ...and others Passive Components Number 1 worldwide in wirewound and other power resistors Number 1 worldwide in foil, SMD thin film, and leaded film resistors Number 1 worldwide in wet tantalum capacitors Number 1 worldwide in strain gage sensors and load cells ..and others Vishay Intertechnology 7 Vishay Serves Diverse Markets Vishay components are used by virtually all major American and European manufacturers of electronic products, as well as by most major Asian manufacturers of electronic products. Industrial From oil drilling platforms to wind power turbines, from heavy machinery in food processing plants to barcode scanners at supermarket check-out counters — myriad industrial applications depend on electronic components to help manage and convert power, process data, control motors, and perform other vital functions. Vishay is a leading producer of components that handle wide voltage and current ranges, extreme temperatures, and other environmental stresses. Electric power generation plants, high-voltage transmission lines, automated factory equipment, heating and air conditioning systems, lighting, trains, elevators, automatic teller machines — these and other industrial products and systems use types of electronic components manufactured by Vishay. Vishay Customer Base Alcatel-Lucent Apple Acer Arrow Array Astec/Emerson Asus Avnet Bosch Celestica Cisco Compal Continental Dell Delphi Delta Ericsson Flextronics Foxconn Future HP IBM Jabil LG Electronics Motorola Nokia Nintendo Philips Quanta Rutronik Ryoden Samsung Sanmina-SCI Siemens Sony TTI Tomen WPI …and others 8 Vishay Intertechnology Computing Computers of all kinds contain microprocessors — the complex integrated circuits that perform calculations and coordinate activities. Supporting the microprocessors are discrete semiconductors and passive components. From network servers to notebooks, computers must handle the current levels and heat associated with rapid microprocessing speeds. Vishay components dissipate heat, support disk drive motor controls and graphics cards, suppress radio frequency interference (RFI), protect against electrical shock, and more. In portable computing devices, they monitor power usage, extend battery life, and enable short-range, two-way communication. Vishay components also are used in printers, scanners, photocopiers, and other computing and digital imaging hardware. Automotive Automobiles — whether they run on gas, battery power, or alternative fuels — employ electronic control units (ECUs) for functions including engine control, steering, braking, traction control, emission control, airbag deployment, security, heating and air conditioning, lighting, and onboard entertainment. Vishay components are essential parts of automotive ECUs. Very hot under-the-hood temperatures, cold weather conditions, and vibration are just some of the stresses placed upon automotive components. Reliability is critical. Vishay manufactures a variety of components that meet the high quality and reliability standards set by the automotive industry. Vishay components help to provide driver safety, security, and comfort, and are used in vehicle information and entertainment systems. Consumer The consumer market ranges from handheld audio, video, and gaming devices to large household appliances. Vishay components are used to extend battery life and perform other functions in portable entertainment devices, electronic toys, and power tools. They are part of the electronic circuits for cable and satellite television, flat-panel video displays, and wireless remote controls. They also are used in “white goods” — refrigerators, washers and dryers, microwaves, and other common household appliances — for motor control, temperature sensing and overtemperature protection, capacitive discharge, short-term pulsing, power dissipation, voltage division, dc-to-dc conversion, and more. Vishay Serves Diverse Markets Revenue By End Market 2007 Telecommunications Mobile phones are increasingly complex devices with audio, text, and imaging capabilities. Vishay components are used in mobile and landline (wired) phones, battery chargers and adapters, PCMCIA cards and dongles for Bluetooth®, and remote controls for wireless data communications. Key applications include detection, modulation, and mixing of radio frequency (RF) signals; power management; audio signal switching; filtering of unwanted noise and suppression of electromagnetic interference (EMI) and radio frequency interference (RFI); and protection against electrostatic discharge (ESD). Supporting and enabling phone- based communications are satellites, base stations, and other parts of the global telecommunications infrastructure. Vishay components are used here as well. Industrial 39% Telecommunications 8% Computing 19% Military/Aerospace 4% Automotive 16% Medical 1% Consumer 13% Military and Aerospace Vishay manufactures one of the industry’s broadest lines of military-qualified resistors, capacitors, and inductors. The Company also produces customized components for military and aerospace customers. Vishay components are used in cockpit equipment, GPS navigation, radar and sonar units, radio and satellite communications, weapons such as missiles and torpedoes, and other military, space, airborne, and aerospace systems. They are designed to withstand extreme temperatures, intense vibration, high humidity, and other environmental stresses. Vishay’s focus on innovation and commitment to product quality have enabled it to build strong relationships with leading military and aerospace customers. Medical The growing medical electronics market includes implantable devices, instrumentation, and communications systems. Implantable devices include glucose monitors for diabetics, nerve stimulators to control symptoms of Parkinson’s disease, and pacemakers, defibrillators, and stents to prevent and treat heart problems. Instrumentation ranges from small blood pressure cuffs to large imaging, radiation, and ventilator equipment. Communications systems link medical staff and patients. Vishay is a leading manufacturer of telemetry coils for pacemakers and defibrillators, transformers for defibrillators, and tantalum capacitors for hearing aids. It provides close engineering support to medical customers. Each advance in medical technology provides new opportunities for Vishay. Vishay Intertechnology 9 Summary Of Operations in thousands, except per share amounts 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 Net revenues Cost of products sold Loss (gain) on purchase commitments Gross profit Selling, general, and administrative expenses Amortization of goodwill Other operating expenses (credits) Operating profit (loss) Other income (expense) Interest expense Other Total other income (expense) Income (loss) from continuing operations before taxes and minority interest Income tax provision (benefit) Minority interest Income (loss) from continuing operations Loss from discontinued operations $ 2,833,266 $ 2,581,477 $ 2,296,521 $ 2,414,654 $ 2,170,597 $ 1,822,813 $ 1,655,346 $ 2,465,066 $ 1,760,091 $ 1,572,745 $ 1,125,219 2,138,438 1,916,658 1,769,978 1,842,080 1,690,267 1,454,540 1,273,827 1,459,784 1,299,705 1,189,107 858,020 - 694,828 439,017 - 37,443 218,368 (28,652) 15,948 (12,704) 205,664 64,133 1,180 140,351 (9,587) 5,687 659,132 403,027 - 46,905 209,200 (32,215) 14,565 (17,650) 191,550 50,836 978 139,736 - (963) 527,506 377,114 - 54,633 95,759 (33,590) 15,603 (17,987) 77,772 11,737 3,761 62,274 - 16,613 555,961 386,346 - 76,046 93,569 (34,252) 10,700 (23,552) 70,017 13,729 11,592 44,696 - 11,392 468,938 380,011 - 29,560 59,367 (39,226) 26,285 (12,941) 46,426 11,528 8,056 26,842 - 106,000 262,273 310,509 - 30,970 (79,206) (29,503) 8,664 (20,839) (100,045) (16,900) 9,469 (92,614) - 696,498 193,744 - 381,519 278,171 11,190 77,908 14,250 (16,848) 12,701 (4,147) 10,103 5,695 3,895 513 - 1,005,282 297,315 11,469 - - (25,177) 18,904 (6,273) 690,225 148,186 24,175 517,864 - 460,386 254,282 12,360 - - (53,296) (5,737) (59,033) 134,711 36,940 14,534 83,237 - - 383,638 234,840 12,272 42,601 93,925 (49,038) (2,241) (51,279) 42,646 30,624 3,810 8,212 - - 267,199 136,876 7,218 14,503 108,602 (18,819) (222) (19,041) 89,561 34,167 2,092 53,302 - Net earnings (loss) $ 130,764 $ 139,736 $ 62,274 $ 44,696 $ 26,842 $ (92,614) $ 513 $ 517,864 $ 83,237 $ 8,212 $ 53,302 Earnings (loss) per share Basic Diluted Shares used in computing earnings (loss) per share Basic Diluted Financial Data $ 0.70 $ 0.76 $ 0.35 $ 0.27 $ 0.17 $ (0.58) $ 0.00 $ 3.83 $ 0.66 $ 0.07 $ 0.42 $ 0.69 $ 0.73 $ 0.34 $ 0.27 $ 0.17 $ (0.58) $ 0.00 $ 3.77 $ 0.66 $ 0.07 $ 0.42 185,646 198,226 184,400 210,316 177,606 189,321 163,701 165,938 159,631 160,443 159,413 159,413 141,171 142,514 135,295 137,463 126,678 128,233 126,665 126,797 126,627 126,904 in thousands, except per share amounts 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 Cash, cash equivalents, and short-term investments Working capital Current ratio Property and equipment, net Capital expenditures Depreciation and amortization Total assets Long-term debt Stockholders’ equity $ 537,295 $ 671,586 $ 632,502 $ 632,700 $ 555,540 $ 339,938 $ 367,115 $ 337,213 $ 105,193 $ 113,729 $ 55,263 1,145,873 1,192,833 1,136,466 1,168,383 1,049,892 897,456 1,096,034 1,057,200 2.92 3.23 3.42 3.27 1,220,998 1,124,365 1,090,592 1,171,815 200,027 214,691 183,298 196,963 136,714 188,900 4,995,235 4,691,896 4,527,591 607,237 608,434 751,553 3,356,775 3,080,813 2,855,852 158,627 202,580 4,638,590 752,145 2,773,335 2.81 2.56 3.29 1,213,600 1,274,850 1,167,533 110,074 180,748 162,493 163,387 3.53 973,554 229,781 140,840 604,150 2.87 930,545 119,638 139,676 650,483 3.13 997,067 151,682 127,947 4,315,159 3,951,523 2,783,658 2,323,781 2,462,744 1,719,648 706,316 605,031 140,467 656,943 814,838 2,358,787 2,366,545 1,833,855 1,013,592 1,002,519 455,134 3.38 709,142 78,074 81,874 347,463 959,648 126,635 194,055 4,566,360 836,606 2,514,034 Note: This table should be read in conjunction with the related consolidated financial statements and accompanying notes and management’s discussion and analysis of financial condition and results of operations. Earnings per share amounts and weighted average shares outstanding have been retroactively restated for stock dividends and stock splits. 10 Vishay Intertechnology Net revenues Cost of products sold Loss (gain) on purchase commitments Gross profit Selling, general, and administrative expenses Amortization of goodwill Other operating expenses (credits) Operating profit (loss) Other income (expense) Interest expense Other Total other income (expense) Income (loss) from continuing operations before taxes and minority interest Income tax provision (benefit) Minority interest Income (loss) from continuing operations Loss from discontinued operations Earnings (loss) per share Basic Diluted Basic Diluted share Shares used in computing earnings (loss) per 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 $ 2,833,266 $ 2,581,477 $ 2,296,521 $ 2,414,654 $ 2,170,597 $ 1,822,813 $ 1,655,346 $ 2,465,066 $ 1,760,091 $ 1,572,745 $ 1,125,219 2,138,438 1,916,658 1,769,978 1,842,080 1,690,267 1,454,540 1,273,827 1,459,784 1,299,705 1,189,107 858,020 - - 694,828 439,017 37,443 218,368 (28,652) 15,948 (12,704) 205,664 64,133 1,180 140,351 (9,587) 5,687 659,132 403,027 - 46,905 209,200 (32,215) 14,565 (17,650) 191,550 50,836 978 139,736 - (963) 527,506 377,114 - 54,633 95,759 (33,590) 15,603 (17,987) 77,772 11,737 3,761 62,274 - 16,613 555,961 386,346 - 76,046 93,569 (34,252) 10,700 (23,552) 70,017 13,729 11,592 44,696 - 11,392 468,938 380,011 - 29,560 59,367 (39,226) 26,285 (12,941) 46,426 11,528 8,056 26,842 - 106,000 262,273 310,509 - 30,970 (79,206) (29,503) 8,664 (20,839) (100,045) (16,900) 9,469 (92,614) - - 381,519 278,171 11,190 77,908 14,250 (16,848) 12,701 (4,147) 10,103 5,695 3,895 513 - - 1,005,282 297,315 11,469 - - 460,386 254,282 12,360 - 696,498 193,744 (25,177) 18,904 (6,273) 690,225 148,186 24,175 517,864 - (53,296) (5,737) (59,033) 134,711 36,940 14,534 83,237 - - 383,638 234,840 12,272 42,601 93,925 (49,038) (2,241) (51,279) 42,646 30,624 3,810 8,212 - - 267,199 136,876 7,218 14,503 108,602 (18,819) (222) (19,041) 89,561 34,167 2,092 53,302 - Net earnings (loss) $ 130,764 $ 139,736 $ 62,274 $ 44,696 $ 26,842 $ (92,614) $ 513 $ 517,864 $ 83,237 $ 8,212 $ 53,302 $ 0.70 $ 0.76 $ 0.35 $ 0.27 $ 0.17 $ (0.58) $ 0.00 $ 3.83 $ 0.66 $ 0.07 $ 0.42 $ 0.69 $ 0.73 $ 0.34 $ 0.27 $ 0.17 $ (0.58) $ 0.00 $ 3.77 $ 0.66 $ 0.07 $ 0.42 185,646 198,226 184,400 210,316 177,606 189,321 163,701 165,938 159,631 160,443 159,413 159,413 141,171 142,514 135,295 137,463 126,678 128,233 126,665 126,797 126,627 126,904 Cash, cash equivalents, and short-term $ 537,295 $ 671,586 $ 632,502 $ 632,700 $ 555,540 $ 339,938 $ 367,115 $ 337,213 $ 105,193 $ 113,729 $ 55,263 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 investments Working capital Current ratio Property and equipment, net Capital expenditures Depreciation and amortization Total assets Long-term debt Stockholders’ equity 2.92 3.23 3.42 3.27 1,220,998 1,124,365 1,090,592 1,171,815 200,027 214,691 183,298 196,963 136,714 188,900 4,995,235 4,691,896 4,527,591 607,237 608,434 751,553 3,356,775 3,080,813 2,855,852 158,627 202,580 4,638,590 752,145 2,773,335 1,145,873 1,192,833 1,136,466 1,168,383 1,049,892 897,456 1,096,034 1,057,200 126,635 194,055 4,566,360 836,606 2,514,034 2.81 2.56 3.29 1,213,600 1,274,850 1,167,533 110,074 180,748 162,493 163,387 3.53 973,554 229,781 140,840 604,150 2.87 930,545 119,638 139,676 650,483 3.13 997,067 151,682 127,947 455,134 3.38 709,142 78,074 81,874 4,315,159 3,951,523 2,783,658 2,323,781 2,462,744 1,719,648 706,316 605,031 140,467 656,943 814,838 2,358,787 2,366,545 1,833,855 1,013,592 1,002,519 347,463 959,648 Vishay Intertechnology 11 Product List Semiconductors Rectifiers Schottky (single, dual) Standard, Fast and Ultra-Fast Recovery (single, dual) Bridge Superectifier® Sinterglass Avalanche Diodes High-Power Diodes and Thyristors High-Power Fast-Recovery Diodes Phase-Control Thyristors Fast Thyristors Small-Signal Diodes Schottky and Switching (single, dual) Tuner/Capacitance (single, dual) Bandswitching PIN Zener and Suppressor Diodes Zener (single, dual) TVS (TRANSZORB®, Automotive, ESD, Arrays) FETs Low-Voltage TrenchFET® Power MOSFETs High-Voltage TrenchFET® Power MOSFETs High-Voltage Planar MOSFETs JFETs Passive Components Resistive Products Foil Resistors Film Resistors Metal Film Resistors Thin Film Resistors Thick Film Resistors Metal Oxide Film Resistors Carbon Film Resistors Wirewound Resistors Power Metal Strip® Resistors Chip Fuses Variable Resistors Cermet Variable Resistors Wirewound Variable Resistors Conductive Plastic Variable Resistors Networks/Arrays Non-Linear Resistors NTC Thermistors PTC Thermistors Varistors Magnetics Inductors Transformers 12 Vishay intertechnology RF Transistors Bipolar Transistors (AF and RF) Dual Gate MOSFETs MOSMICs® Optoelectronics IR Emitters and Detectors, and IR Receiver Modules Optocouplers and Solid-State Relays Optical Sensors LEDs and 7-Segment Displays Infrared Data Transceiver Modules Custom Products ICs Power ICs Analog Switches RF Transmitter and Receiver Modules ICs for Optoelectronics Modules Power Modules (contain power diodes, thyristors, MOSFETs, IGBTs) DC/DC Converters Capacitors Tantalum Capacitors Molded Chip Tantalum Capacitors Coated Chip Tantalum Capacitors Solid Through-Hole Tantalum Capacitors Wet Tantalum Capacitors Ceramic Capacitors Multilayer Chip Capacitors Disc Capacitors Film Capacitors Power Capacitors Heavy-Current Capacitors Aluminum Capacitors Silicon RF Capacitors Strain Gage Transducers and Stress Analysis Systems PhotoStress® Strain Gages Load Cells Force Transducers Instruments Weighing Systems Specialized Strain Gage Systems 

Continue reading text version or see original annual report in PDF format above