Vishay Intertechnology Inc.'s fiscal year-end income soared 53.9% as it reaped the benefits of a wireless communication market and a companywide restructuring carried out in 1998.
Vishay's fourth-quarter sales rose to $468 million, up about 14%, from $412 million in the year-ago quarter. Earnings rose to $36.5 million, or 42 cents per share, from $14.2 million, or 17 cents per share, for the same period in 1998. Company officials said that earnings reflected a five-for-four stock split that was paid out in June 1999.
The passives components and discrete semiconductor supplier's annual income rose to $97.8 million, or $1.14 per share, in the year ended Dec. 31, up from $63.6 million, or 75 cents a share, in 1998. A one-time charge of $14.6 million, or 17 cents per share, relating to the sale of a business unit and tax changes in Germany, reduced 1999 earnings to $83.2 million, or 97 cents per share.
Sales for the year climbed to $1.76 billion from $1.57 billion in 1998.
The company attributed the improved profitability to "production efficiencies, cost-reduction programs, including movement of labor to low-cost countries, price stabilization, and in some products, price increases," said Felix Zandman, chairman and chief executive of Vishay, Malvern, Pa. "Most of the price increases are still in backlog and will now begin to be reflected in the first quarter of year 2000 and thereafter."
Sales by passives and discrete-semiconductor manufacturers have jumped in the last 12 months due to rising demand within the telecommunications market, especially from wireless OEMs and contract electronics manufacturers. Also boosting earnings were strong sales in the wireless market by Siliconix Inc., a discrete-semiconductor maker that is 81% owned by Vishay.
Vishay's gross margin for the year grew to 26.2% from 24.4% a year ago. Gross margin for the fourth quarter was 28.2%, up from 23.9% in the same period of 1998.