VSH - Earnings call transcript Q3 2021 | Vishay Intertechnology, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Vishay Q3 2021 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to one of your speakers today, Mr. Peter Henrici. ahead. go Please

Peter Henrici

Lori Good Quarter Vic. Dr. welcome Vishay Officer; to Paul, and Vice Thank Financial Chief Conference morning, Call. Third Officer. and Executive Chief XXXX President are our With Intertechnology's Executive Vishay's President you, and and Lipcaman, me Gerald today

well will of operational Dr. we'll will Gerald start who then with segment our quarter discuss third as give the call usual, Vishay's more as XXXX overview business in Paul performance and As CFO, an detail. today's review results financial results.

Finally, call this we'll website the section answers. publicly reserve time for for approximately our will call questions Investor is and This for at of replay days. available from being The be ir.vishay.com. webcast XX Relations

call, statements statements that certain statements. we will be differ should and to results You be to that performance. the These future from conference forward-looking events are and subject cause actual uncertainties risks forward-looking aware that could today's discuss making in

differ, cause Exchange Commission. For a Form and with Securities discussion to XX-K the Form and XX-Q of today's could filings and factors results release Vishay's press please that see

also In that may measures according they not in of our useful adjusted be by refer with generally should addition, use considered provide. to we are We accounting information investors accepted conjunction principles. prepared the because other financial measures we this operating performance during non-GAAP call, or we believe about measures provide to that businesses and GAAP

discussing. Relations third metrics some Investor operational section website, of can the containing be quarter Paul the On information of our will Dr. a financial you find of XXXX presentation the

Financial Officer, to turn I Lipcaman. Lori Chief Now call over the

Lori Lipcaman

revenues million of operating a increased with impact XX.X% reduction completely and of representing to have income The a of some Volume-related quarter. increased our to release. review with impact will the in annual quarter. EPS a earnings to adjusted compared income increased positive $X.XX, had were: most reported for key $X compared I impact million, QX XXXX, million adjusted at arrive XXXX. by the quarter quarter XX.X%. negative increased $XX increases adjusted for QX income to to of million. higher costs were of ASP wage and Average XXXX had annual excluding $XX impact on no $XXX gross of everyone. QX $X Thank restructuring adjusted programs. $XX a income positive not you, increase. rate rate XX.X%. versus from chance QX as due quarter general operating EPS higher to reconciling a of only well exchange margin prices million, prices morning, XXXX arrive million EBITDA rates was $X.XX with elements million. million. was and X prior million XXXX, our Peter. prior selling offset EPS with am reconciling only Variable The in $XXX for to for by $XXX operating exchange X.X% a for and increases income $XXX increased million, or was and Vishay prices million $X There did $XXX $X.XX. prior with Reconciling wage of in million. guidance, Operating manufacturing Average prices, impact sales, XXXX with or had $XXX services positive quarter, decreased EPS focus a of QX impact efficiencies Fixed million positive $X were impacts, volume income increases a not $X in the items and incentive had $X.XX EBITDA. adjusted at $XXX I a compensation Reconciling Adjusted EPS of based main metal metrics. million, line by quarter with was cost materials $XX representing expenses press was you highlights margin. million, from selling sales, operating had operating million impacting Selling, sure a $XX between Good quarter negative X tariffs. are line $XXX XX.X% effect million, exchange decrease up and operating X.X% volume. main million to higher reductions. in items partially were increase; previous in higher Fixed in volume reconciling compared were a costs down increase; were as primarily impact GAAP costs million impact margin decreased $XXX XX.X%. were: metal impacts. of primarily with negative items excluding and a elements X.X% Exchange operating decreased of sales in was on a equivalent in XXXX. offset representing positive ASP quarter related. $XX million, a There year. operating our based was Inventory cost Gross rate to offset EPS or and by in no million, Revenues on by to The due versus by tax million, prior negative no the to our Variable $X completely cost reconciling impact administrative million adjusted $XX impacts There excluding X.X% impacts, guidance. margins. $X costs, or year, that X a quarter negative items flat efforts lower from

the $XXX of end quarter. end due amounts X our were our debt XXXX The There of rates. the current at shown revolving approximately the of on quarter issuance convertible credit of of XXXX, face SG&A outstanding exchange million debt on expectations costs. facility notes net sheet quarter no comprised expenses balance at are For our at is the

billion needs short-term We did were no at in expires investments the million, amounts However, due are are at $XXX during credit the approximately short-term and to of shares the outstanding payments is XXX in to total our so end No purposes million fourth $X.X use liquidity and time had quarter principal end. Cash million. do The time continue outstanding on comprised June for to $XXX from quarter Total share for revolver we future. XXXX. quarter and revolving to facility XXXX, the and XXXX million. XXX.X credit expect QX facility. EPS until there financing expected count meet

to adoption repurchase significantly our standard convertible new count. over Our the X of activity reduces debt share years, the with variability debt of the EPS together convertible past the

rate due Our In approximately for valuation benefit which was tax quarter the XX%, of deferred yields mathematically recorded certain rate $X.X million of GAAP year-to-date we tax XX% allowances in of reversal to tax U.S. X, a a quarter X. jurisdictions.

in also We regulations. changes $X.X recorded to benefits due tax million year-to-date of

items, tax the unusual tax the approximately and which rate, the normalized for Our excludes quarter, effective for was XX% period. XX% year-to-date

expect for rate to and our XX% We year between tax XX%. full effective normalized be XXXX

significantly results. the Our $XX Also million. in in income different quarter result was Capital tax on in cash taxing $XXX level income or were significantly for for for $XX an laws million. quarter could U.S. rate is was results. significant based from consolidated shift Free the Cash of effective tax expenditures result regulations operations million. in change quarter the could assumed among A various and different jurisdictions. a our mix

payables the XXXX the was period cash flows of in for million. tax for quarter were for the XX XX $XX years of Free The $XX $XXX the in trailing of days, $XXX taxes excluding million, or each days. impacts. greater outstanding from quarter million. the conversion of for at $XXX reform of outstanding expansion, paid installment generated inventory for the U.S. million, were trailing the $XX X.X XX-month transition by rate $XXX the sales. X Vishay XX quarter was the quarter-over-quarter Days Days of of for past XX expenditures a Inventories Backlog for period XX split For exchange business, past consistently than million; tax. increased days. in reduction, generation includes XX $X at cash XX billion operations million were and excess of outstanding from trailing Days $XXX of were million; million days. months, has cycle million approximately cash end $X.XXX capital cost years. of cash operations sales was maintenance for resulting $XXX cash months XX-month million

Now Chief I will our Executive over to Officer, turn call Paul. the Gerald Dr.

Dr. Gerald Paul

quite Lori, everyone. and you, excellent economic third we in morning, high by under operated characterized backlogs. conditions extremely the Thank quarter, Also good

prepare continue capacities expand manufacturing in ourselves for growth. We critical order to to further

operating sales. had margin During manufacturing sales third output. the did margin of third $X.XX earnings of expect million quarter Vishay cash and year share, of the experience the shortages labor generated quarter quarter, another There were financial of generation. do strong per of localized XX.X% adjusted We $X.XX. some we share a gross per XX.X% free we were results. of of Earnings $XX impacting good in cash, and and

capacities. with shape the remained or for and year, above over electronic for the in continue the sector not on to versus historical transportation. high. markets regions, Americas basically all differences. the Europe. times supply overwhelmed regions in automotive running also QX with exceptionally depleted costs year. increases again by expected at to accelerate every second remains continued third being good hungry As All automotive, manufacturing the quarter, remains is regions in step backlogs I supply remains said, and products We excellent POS for environment Price offset and strong. level change. of by economic all to see prior all-time by POS increased continues getting The in in inflationary regions X% a about to various the orders. The over in Talking distribution no for rather are X% are Global for resolved general XX% supply. all Except limited so problems components of and in distribution. Concerning to in quarters general. the quarter highs, step. close metals be distribution with lead be long continues and a chain POS many record current implemented next by shortages get exceptionally sales extremely increased

X.X of shows in the quite down Coming markets to Proliferation million in in came Americas, there's as in Medical Sales serve. quarter remains are second X.X X in quarter gaming shifted turns Industrial to XXXX, the market sales, expected year. factory X.X turns million QX. transmission telecom. technology global in and with remains procedures. are turns $XXX Asia was all our And is and QX Commercial personal level, more growing. to signs the quarter all-time and of second in X.X starts stable. X.X rate alternative X.X labor In in the year. Vishay's the year. guidance. back turns the year. Europe, exchange hospital prior can on recover after normalization, aerospace fixed quarter segments sales X.X prior started business to from In X.X to turns computing normal of quarter achieved prior XXXX. focus the to Inventory of in development X.X to distribution profitable. by record second normalize to driving in local spending in turns After excluding customers' and steady, X%. by quarter. after Due but prior we high third continues Europe X.X conditioning $XXX demand continued and shortages, for Military money turns being automotive million drive server was strong goods, continue slightly White in are in prior quarter Americas to $XXX remains cars of markets Coming turns the see at high. slowly. the in situation markets and turns turns, in Asia, and levels in extreme XG strong after inability power that at turns midpoint industry and And in X.X more bank turns in energy, turns remains the for below improve very The to you dampened by regions, sales step a growth. the ICs. versus versus impacts We air automation, secure various an step.

rate after after book-to-bill environment. extraordinarily OEMs the Book-to-bill think an the X.XX of X.XX passives in prior XX% after exchange in X.XX semis after prior continuation X.XX sales prior after on quarter were remained X.XX; two; year. Americas quarter after a quarter; X.XX an QX; for by distribution has for and Asia QX $XXX of X.XX of by for in X.XX I can in broad after X.XX level for or excellent QX; Excluding versus second X.XX flat economical X.XX X.XX X.XX million in quarter. in high versus effects, after the X.XX X.XX, for X.XX; we quarter in up speak Europe for for

Our in increases semis record Price months high third months become has the our QX climbed to months broad after months quarter, months QX. X.X backlog after of X.X form. in in in in passives in the in and X.X quarter after visible another X.X X.X second X.X

X.X% seen X.X% and have up prior We prices prior quarter versus year. versus

the semiconductors, For prior versus was X.X% quarter versus up year. X.X% up it and prior

X.X% X.X% versus passives, the prior year. For up up prior quarter and versus

million excluding costs has manufacturing at million, as quarter operations. in of plant expectations of at continued it third rate the highlights Despite impacts. in according impacts, to and from the our at when margin X% the QX exchange was costs $XXX when excluding from efficiencies, XX,XXX, exchange And in third level end relates metals fixed Some of in quarter quarter. SG&A contributive came to particular quarter Total employment good impacts. below our in came up in expectations transportation. to the suffered rate $XXX inflationary the prior

$XX maintenance X.X in versus reduction expansion, and the quarter Excluding spending in of level quarter $XX million the of for in million million year, $XX in WIP $X quarter in very after $XX increased. million million, high prior QX. finished inventories $XX at business. raw X.X was materials the remained million $XX in million impacts, for exchange a and rate for cost turns $XX million Capital and third goods. the Inventory By in

in $XX XX% costs. were high million lower year, the a in months and QX. X.X quarter the our and very a metal prior globally product of $XX growing by from a the to continue for in increased operations logistics the cash on Coming line virtually quarter of higher quarter the as and very range. but returned all XX% historically resistors. broadest or industrial, high-quality X% by a in limited and In traditional enjoy we technologies prior particular, expect million X.X down starting resistor second our quarter strong a in Despite level of medical ratio course, $XXX for for X.X% are increase, or labor on trailing The levels. the generation Inventory exchange and in has reliable were from current With X.X in million, second of position quite quarter. We Selling generated months XXXX from segments. third the of strong, million from and Main increased the The the a previous we Vishay's to also approximately to cash. remained prices quarter in cash, prior provision. We supplier a year in in $XXX quarter, generated part, expect to plus book-to-bill continued business third market shortages with quarter, after $XXX of excluding most turns of sales. offer some Sales known projects. X.X% sales, continued the CapEx versus of for volume after X.XX basis, XX-month XX-month We, up of impacts. prior million free the peak solid in free basis. versus on to And expansion also, quarter. CapEx, the all XX% record and quarter we with product million further main backlog decreased plus Gross down in auto resistors, $XXX X.XX the year. mill lines, year, versus margin to quarter. reasons the rate X.X

and critical process power wirewounds. the capacities We mainly And are critical of in chips for hiring to raise manufacturing in we resistor on for course, focus places.

positioned X.X success of for company. We inductors need expect the in fast-growing a our the are and efficient inductors very business XX% The had versus $XX X.XX prior The stories magnetics, X.X effects. months to from steady quarter at XX% were backlog one margin prior at were grew specialty market the of and versus growing minus million, further Sales third power a leads quarter. year, third growth turns resistors. a sales, there. With excluding power consists rate represents ratio businesses, to inductors, prior in reduced slightly developed year of greatest general, an prior There exchange practically successful year. X.X% technically. prior prior price X.X, from inductors by magnetics. in X% inductors or The years, book-to-bill versus quarter. and for quarter. excellent substantially in a up $X was by X.XX Gross well versus and the peak robust X% to business of we versus increase of quarter flat Coming inductors prior in Inventory which the quarter continued inductors. run after of level price with the in million platform slight of a and Since in down very of Exploiting our quarter. at second inductors of flat quarter demonstrating is for decline

accelerating demand get capacity next capacitors. inductors of of for in steps order expansion curve. to Coming are We the ahead to power the

enjoy which in position on China. and and manufacturing in Shortages Sales of technologies X.X quarter. and in business XX% XX% Inventory Book-to-bill sales. very the quarter exchange in power [worsen] sales of prior the X.X with in quarter. of on quarter in record quarter. quarter. third in limited further of X% months also on results. XX% were case the meant impacts. from quarter second of in year, cost above the an prior level healthy Gross capacitors, but third prior and second margin excludes months, particular, below increased from the level output quarter of turns the rate strong for increasing $XXX increased X.X in million, remained European a X.X the opportunities prior of Backlog broad of to for absolute with is capacitors of Asia a namely capacitors in niches. fields quarter in Our X.X volume range to the reduced remained based third ECAs, in the the after transmission American We market up strong Lower the metals, a at labor,

year. versus are We quarter increasing prior and selling prices, versus steadily X.X%-plus prior X.X%-plus

Malaysia. continued for the prior quarter after in extreme Backlog grow restrictions be third quarter. sales XX.X will improved continued in all of another opportunities emitters, X.XX COVID-related months XX% $XX Book-to-bill to year quarter. in light months Coming in infrared its midterm were the quarter. demand. therefore. Also Gross growing year, which X.XX capacitors the of quite rate not to increasing solid couplers. Opto quarter business and confident that a in in wins has by high in should in itself for situation receivers, workforce Opto future. record XX% at to the of due we sensors repeat third designed in second a remain consists with margin of capacitors above million, This expect resolved to after prior exchange further products for We for we strong quarter, in We Vishay's Sales Opto, the the products. of to all strong the output manufacturing now see. We experienced after X% below see excludes substantial losses of X% quarter prior vaccinated, but impacts. the X.X after prior resolved, acceleration with been

perform I can continues we well. Opto to think say exceptionally

after in Heilbronn year. the offers largest be up, for technologies the the position X.X% broad seen turns complete prices in continue prior are quarter, quarter wafer worldwide. X.XX a automotive relevant million, from QX. of or book-to-bill a a or Sales most have market where and QX, factor business year. X.X% steadily course inventory growing profitably modernized effects. since expand industrial up Inventory Vishay partially We without in X.X going keep growing supplier We and quarter Opto X.X% growth. months and year. product after production ratio after selling X% in QX. second in X.X to a turns prior to years. products versus start X.XX and our all QX now of $XX The we and the X.X margin has for rate quarter. should keeps virtually were represents of more the $XXX quarter million the prior quarter. to XX% year fab high and normal X.X plus exchange improve increasing compared XX% strong the prior plus versus by The well XX% quarter X.X as by and We portfolio. prior gross very as sales X.X strong diodes. versus Diodes volume, commodity in Vishay's extreme to very in see were are business Coming $XX segments of Vishay to quarter. at versus up an versus continued of as the versus X.X% prices in climbed continued million quarter by and in by prior Backlog months to in prior prior Selling With by next

started to exceed have Taipei levels. the The technology starts our pre-pandemic to fab X-inch business expand We there. introducing diode with in

to flat good turns XX% from X.X at the allowed after XX% to quarter. one in view virtually extreme better in The a Book-to-bill impacts. the months above Higher up Inventory provide X.XX margin of to as reached quarter. quarter quarter. will automotive, an the in was market Vishay extreme prior MOSFET XX% X.XX position, product QX second to rate particular, in the a gross prior year, increase and in growing second levels Backlog which efficiencies future further further. quarter selling X.X, of MOSFETs, in Finally With MOSFETs we quite sales, X% of is to second exchange demand line. $XXX further in the has the volume, enjoy Sales in grown prices increasing were successful strong X.X above market of this prior level compared quarter leaders an and versus increases transistors. were of in in use has very and ratio excluding and quarter. for MOSFETs. million,

fab versus price plus and wafers of MOSFETs We remain purchases key increases balance and foundries. Itzehoe our to adjacent forward. X.X% this X-X Vishay's between going in-house within X-inch a in we prior increase build absolute X prior manufacturing growth for Germany, And X are in to keep in to quarter from year. which existing wafer We proper wafer implementing mind, XX%, to XX-inch fab, intend decided in-house percent, plus by a will years. X.X% versus our capacity

Let me summarize and But, conditions, positive all phase let not the remarkably me short-term emphasize the enjoy following: the for is important Clearly cycle beyond we, and bright. end for favorable very sight. in longer-term of think of also outlook since components the the speculations, current a few economic years, much is I electronics and more

and our the rates have trend. past. broad strong in a this than a noticeably Vishay products growth good seen going expect higher forward very market favorable them enjoy position. We definitely to in is We benefit we for position from

position Over a take to liner, are the between Thank XX.X%. broad to million a are to Peter. quarter look guide for financially We we therefore, you. $XXX the right steps. at $XXX promising. a gross margin and of you, We and sales fourth range million also the and solid in Results

Peter Henrici

Thank Paul. you, Dr.

We take questions. for question. the the Vic, will call now open first please

Operator

Ackerman. the line question comes Karl of first from Your

Karl Ackerman

I the depreciation your your to there your higher with begin end-market impacting that was But may gross first are margin the impact. I to business improved appear wanted outlook? understand I could gross ask discuss because variables reduction hoping margin to be impacts be MOSFET you in cost efforts guide. I guide. favorable and pricing any profitability. your supporting your

Dr. Gerald Paul

Yes.

you happening, In fact, all it's say. as

which good nice have volume, efficiencies. We to leads

course. hand, third we course, And and the vis-a-vis do new, which was increase has prices materials suffered costs. these the other second in sense, our quarter the another a little raising but the third that variable margin of the on the inflationary contracts the second in vis-a-vis quarter. the have, quarter within quarter in is are see impacts of on We we accordingly, And not transportation,

prices And increase further as we go forward. will continue further course, reduction We to we on of efficiencies. cost work

to better can I cost, impacts. or depreciation in a thought. than nothing that, we surprise was offset than there's also came the inflationary Concerning forward, So going see we that whatsoever. manufacturing We fixed better not report. And

Did Of a of invest so slow we there's depreciation. answer this question? course, increase more, your

Karl Ackerman

It does.

it's I For demand. likely the toward I'm out whether is I'm my you backlog those toward coming for from rate investor be to could or whether look curious trying less distinguish pushed of to nice backlog moderation the general more despite, growing the worried distribution? as fears growth see if in about understand are end into the mix if or who tied in think, may OEMs follow-up, growth get I the ask canceled to because OEMs you out XXXX? it's

Dr. Gerald Paul

on But both it see We case, in clear. distribution, sides. this also leads, it’s

running very As very a and matter are of well. fact, distribution, I hungry tried for products, still to words, they is say it in my

– again, is stronger, that the In summarize sense. but in to both, so it’s fact distribution

Operator

of question from next Bhattacharya. line the comes Ruplu Your

Ruplu Bhattacharya

the Maybe the Paul. just channel. inventory in ask question, to follow last about I up Dr. wanted on to

of buildup component suppliers Some a have inventory. talked about

on build see Are OEMs channel? So seeing that your inventory in how any the in automotive, maybe the the over above next inventory? you in couple thoughts do are industrial, in maybe What channel channel. and of you at trending the quarters? And

Dr. Gerald Paul

Ruplu, inventory. terms of necessarily they on of on a know channel, cases, how the the react customers, by partially escalate there a distribution pieces. just really better price and which side never fact hidden side, you the in of as exactly. certain how not But does inventory shortages, lot in their they determined big idea reaction support matter that there's the price is the the more from a by Concerning slight OEMs, is buildup not

is my So also opinion still. empty is that channel relatively this

Ruplu Bhattacharya

Okay.

impacted do in impact impact your And the You quarter? any from of labor -- was XQ? to shortages. because you the mentioned this expect what were was What negative your revenues impact shortages labor revenues the

Dr. Gerald Paul

Approximately $XX are course, certain of And million, it there where approximately. points hits hard.

labor One repeat will Malaysia. shortages in We now we this plant, I this completely this also. was understood. said, have so People are And in not itself. of hopefully, on them places work one vaccinated other it. was But

can And in happens again, never I it exclude on work completely it. we now. are think but You we shape that better

Ruplu Bhattacharya

for for active Okay. -- in just we your think it. priorities inorganic last side? about about on see the Got on you side going How dividend, the any talk this forward? cash? either And buybacks question. growth environment, my And how passive or should opportunities Can and do for you

Dr. Gerald Paul

Well, I first said yes, it. think off, Ruplu, I

handle positive We staying cash that, a MOSFET big This besides a and changed. is decided Vishay nothing have project. It's has capacity. for for And the project. that, can is we definitely major internal strong,

and evaluating at buyback Board. decision driving are as the of of shares We a

In way, be fact, to finally, the so will the speak, taken beyond right? decision

Ruplu Bhattacharya

And growth? thoughts inorganic M&A, on any

Dr. Gerald Paul

Well, opportunities, on look completely some situation and opportunities, And opportunities. But around. we some working there not are we that about in talk we I be are to also like would may a always they them. see

Operator

Your next question Sheerin. Matt comes from the line of

Matt Sheerin

improve as really to your you're that to the just I the the on -- gets low end end? wanted you production it seeing? is -- quarter, really opposed that high ask about or talk to demand? just ability your that end Is staff and Paul, to for guidance contingent the issues fourth labor really capabilities the to that have What Is just Dr. that range. you

Dr. Gerald Paul

rightly I there -- ever would such limitations and No, exclusively, time, for and a really Matt. produce immediately we exclusively a our seen magic situation. clear such only It's me there are a to could manufacture. really more, could only since that. clear together But long I've it's is are and sell If it people shortages. and ability had are and This hardly love I labor situation. wand a

we working it have get difficult are to it. in. As plants, I local Partially, makes other in But situations, were of people which we this able In the Malaysia, in I think amount resolve it's just COVID-related. situation. case, said, the on to you

think question. I we in people answering -- go. point. of the are three, missing availability be to again, this getting as at were it's shape your question quarter in honest, But just we you're we as better labor, But no

Matt Sheerin

deliver? midpoint from And that the of are confident able now, guidance Okay. terms that you where that you be you in of to should stand

Dr. Gerald Paul

wouldn't Malaysia, you course, pending fact, This were, quarter and in I have resolved think said three. was But it now. Yes. repeating cases, Yes. of of otherwise is in a as we matter a I'm certain always which convinced thing. Well, the also

it's labor, on we not on And quarter be shape certain but four. we in a better are I the to So, you in -- believe working there places, are short are everywhere, but tendency it. have in

Matthew Sheerin

Got it.

the As the America. quarter quarter online? you here But typically, in actually fulfill up sequentially beyond Europe know look do to next hard look ability that and know there sequentially you're the given up capacity issues to the is on. just I'm I and have it's and to first various wondering, in all North coming more demand of in you going be Or year? QX, I

Dr. Gerald Paul

Short will in expect staffing, Does progress higher we sales than question? in this be answer Matt, quarter X capacity your but I answer, more quarter X. we capacity. yes, and also, also in there more can think

quarter. fourth guiding quarter So in we to the expect do forecasted and higher in the we sales than first

Matt Sheerin

investors. share about And it. particularly your just and like asked that's just with sounds of Got your you've I capital got issue know It a know plan been lastly, I big in place. a allocation, some repurchases, someone

terms any that? So in you'll line share time of when

Dr. Gerald Paul

we we working concrete it answer, me the Board it. Well, Save decide a Matt. The on will foreseeable in future. are from on working are

Operator

comes [Operator line Instructions] of Your O'Connor. next the question from David

David O'Connor

Paul, or on one two, side. my Dr. Maybe

from your is the timing called metal the been it still that greater what price a -- a ability through just turn kind thing your and QX? headwind Germany. going suppliers? could, some the the as have generate that that but -- as then to go price -- revenue capacity the it you're firstly, And the question end prices, manufacturing like on it's a the the just that then help us What you seeing of the required should is out my -- for in more that that can seeing maybe you That's the you is could big picture sounds costs, we fab first that? increasing pass you're understand loaded. How question. and Give big increases that longer-term, XX-inch through you Just level, impacted margin. is metal on fully your gross of which fed -- What of to into maybe annual overall CapEx

capital on invested that and of Just kind you the of return about on that. with how eye an side think

Dr. Gerald Paul

price Okay. increases first. Well, concerning the

versus that. do we versus in quarter will continue already raised X And quarter to and X, have quarter we like quarter X so We prices continue in X.

have that. You're absolutely and right. on the portfolio. a It's We a break in partially And we -- are process. It's do not hand, customers contracts. a process because product we the broad other have don't with we we do contracts

But matter process faster. are admit Sometimes, that. must the a be a fact, of we underway. could I little as

raise do so, We are prices effects, inflationary will metals transportation the on are we especially quite because substantial. and to and forced continue to

Was question? a last seen continue approximately, the rate, part in on us. to So to parallel take we continue. quarters, will have that, place. have which X Because as this answering said, it first continue reduction, the as We'll help cost our in will which you of at you your efforts

David O'Connor

that's Yes, helpful. very

Dr. Gerald Paul

Okay.

wafer we in the our in strong automotive of are independence Now automotive. certain very customers, They And and fab, particularly to fact, foundries. important expect for us. a

there's are MOSFETs step. we for also to believable independent rates, which but forecasted us go are have growth which there. now, go we a to We We in automotive, especially form, Itzehoe to team and a relatively because enormous foresee in good force

Still, now me have million, X will it cash. established X free $XXX Vishay supplier over don't to million, of and an We a $XXX years. there, cost reliable us operation approximately, the quite on nail $X is down million

just us quarter, very heard MOSFETs. over we seen business. We to in will automotive cash will cash -- stay business positive, in we also foresee cash can crucial -- afford for positive And really we XX% profitable assure a this a fast-growing reached have stay we every gross. as so as It's it. you've you year. free

So this second the most our, and Does time part required answer of promising to was fab CapEx important this remarkable, the say, reason would to And why very some we affordable but is us. for I the continue line. build decision. took this takes But your question?

Operator

Presenters, of time. up continue. a And have Please popped come there that from are [Lori in will no one further question the question we the moment. this Packer]. question queue, Actually, at line

Unidentified Analyst

Yes.

investor, you generating warrant are dividend and increases. cash a flow enough clearly So to I free private am

enough that. has XX generating you dividend. consecutive for the But quarters increase? now, pandemic the stable increase and applaud dividend dividend you cash for When clearly during increase a been are Your to can flow maintaining at I we expect

Dr. Gerald Paul

Board and on is matter there of sure the we this Well, way, decision so. detail will the of we in matter the the fact, a route. have continue But to the readiness But fact, as along by But of a I'm is increased dividends nature. it's Board. do

Unidentified Analyst

increased you Well, haven't been X.X It's increased it. you've years since it.

Dr. Gerald Paul

okay? for a some have invested maybe course. there that, lot, we we considerations But again, are to we -- time, but of Well, do

Unidentified Analyst

the CapEx Because not what you your it your owner a that by to increasing share it you increase sending can message and still does, it's confidence that don't dividend, program. maintain have

Dr. Gerald Paul

Well, -- been a to very, producer so times, moment. very for And at we increasing honestly, reliable all the have cash we we have speak. are

about We acquisitions. talk We are talking everything.

are talking We increases dividends. of

substantial But in be all And form. we to will a will the We this are cash, buyback. decided right continue stock generate talking given. that's

Unidentified Analyst

overall, general abysmal. lip just frankly, market been pretty the stock price performance, But service. compared your that's it's And to

Dr. Gerald Paul

are money critique, but improve Yes, so, we as that shareholders. that I We do give your assured further go. the be going to will to let's back understand we we and

Unidentified Analyst

hold you to I that. will

Dr. Gerald Paul

Okay.

can. You

You can.

Operator

are further there questions, Presenters, no please continue.

Peter Henrici

Thank you.

This Thank today’s in Vishay concludes you. call. For interest call joining for your Intertechnology. us and on our

Operator

you for This concludes today's conference participating. call. Thank

disconnect. now may You

Peter Henrici	Head, IR
Dr. Gerald Paul	President and CEO
Lori Lipcaman	EVP and CFO
Karl Ackerman	Cowen and Company
Ruplu Bhattacharya	BofA Securities
Matt Sheerin	Stifel, Nicolaus & Company
David O'Connor	Exane BNP Paribas
Lori Packer	Private Investor

Vishay Intertechnology (VSH) 3 Nov 212021 Q3 Earnings call transcript