Vicor Corporation Reports Results for the Third Quarter Ended September 30, 2009
ANDOVER, MA -- (Marketwire - November 03, 2009) - Vicor Corporation (NASDAQ: VICR) (the
"Company") today reported its financial results for the three month and
nine month periods ended September 30, 2009.
Revenues for the third fiscal quarter ended September 30, 2009, decreased
to $47,746,000, compared to $51,278,000 for the corresponding period a year
ago and $50,627,000 for the second quarter of 2009. Gross margin decreased
to $20,668,000 for the third quarter of 2009, compared to $21,903,000 for
the corresponding period a year ago and $22,598,000 for the second quarter
of 2009. Gross margin, as a percentage of revenue, increased to 43.3% for
the third quarter of 2009 compared to 42.7% for the third quarter of 2008,
but decreased on a sequential basis from 44.6% for the second quarter of
2009. Net income for the third quarter was $1,691,000, or $0.04 per
diluted share, compared to net income of $609,000, or $0.01 per diluted
share, for the corresponding period a year ago and net income of
$1,341,000, or $0.03 per diluted share, for the second quarter of 2009.
Results for the third quarter of 2009 included a payment of $750,000
received from a vendor with which the Company had entered into a release
and settlement agreement resolving alleged product performance issues with
certain of the vendor's products. The payment was recorded in "Gain from
litigation-related and other settlements, net" in the Company's
consolidated statement of operations.
Revenues for the nine months ended September 30, 2009, decreased to
$148,821,000 from $154,044,000 for the corresponding period a year ago.
Net income for the nine month period was $489,000, or $0.01 per diluted
share, compared to a net loss of $(94,000) or $(0.00) per diluted share,
for the corresponding period a year ago. The operating results were
negatively impacted by aggregate pre-tax charges of $4,083,000 for the cost
of severance and other employee-related costs in connection with workforce
reductions implemented during the nine months ended September 30, 2009,
partially offset by the settlement payment discussed above.
The book-to-bill ratio for the third quarter of 2009 was 1.19:1, as
compared to 0.79:1 for the second quarter of 2009. Backlog at the end of
the third quarter of 2009 was $50,502,000, as compared to $41,515,000 at
the end of the second quarter of 2009.
Commenting on the Company's third quarter performance, Patrizio
Vinciarelli, Chairman of the Board, President and Chief Executive Officer,
stated, "Vicor continues to benefit during these uncertain economic times
from the relative stability of our power components and systems business.
While revenue declined sequentially for the quarter, we were profitable and
generated cash for the period."
Dr. Vinciarelli continued, "During the third quarter, we accelerated our
capital expenditures to expand V·I Chip manufacturing capacity by a factor
of three. We are focused on having this capacity on line in Q1, 2010 in
anticipation of stepped up demand later in the year."
Depreciation and amortization for the third quarter of 2009 was
approximately $2,507,000, and capital additions totaled $1,539,000. For
the first nine months of 2009, depreciation and amortization was $7,741,000
and capital additions were $4,282,000, compared to $7,824,000 and
$6,557,000, respectively, for the first nine months of 2008. Cash,
restricted cash equivalents and short-term investments increased by
$5,528,000 to approximately $36,978,000 at the end of the third quarter of
2009 from $31,450,000 at the end of the second quarter of 2009. There were
no share repurchases during the quarter, and approximately $8,500,000
remains authorized for additional purchases. Vicor previously announced an
indefinite suspension of its semi-annual dividend.
As of September 30, 2009, the Company held approximately $35,900,000, at
par value, of auction rate securities. As previously disclosed, conditions
in the market for auction rate securities and the repeated failure of
auctions by which such securities are priced have led the Company to
continue to classify its holdings as long-term investments. Based on the
Company's ability to access cash and other short-term investments and its
expected operating cash flows, management does not anticipate the current
lack of liquidity of holdings of auction rate securities will affect the
Company's ability to execute its current operating plan.
The tax provision in 2009 provides for estimated income taxes due in
various state and international taxing jurisdictions for which losses
incurred by the Company cannot be offset, and for estimated federal and
state income taxes for certain minority-owned subsidiaries that are not
part of the Company's consolidated income tax returns. The 2009 tax
provision also includes discrete items, including benefits for the receipt
of a refund for a net operating loss carryback claim and for an expected
refund due to certain monetized credits, and expense for increases in
accrued interest for potential liabilities. In 2008, the tax provision was
based on the estimated annual effective tax rate for 2008, which includes
estimated federal, state and foreign income taxes on the Company's
projected annual pre-tax income and estimated federal and state income
taxes for certain minority-owned subsidiaries that are not part of the
Company's consolidated income tax returns, offset by the expected
utilization of federal and foreign net operating loss carryforwards. The
2008 tax provision also includes discrete items, including the reduction of
its tax reserves by $1,123,000 due to closing tax periods in certain
jurisdictions, offset by increases in accrued interest for potential
liabilities and expense associated with a reduction in state income tax
refunds receivable.
For more information on Vicor and its products, please visit the Company's
website at www.vicorpower.com.
Earnings Conference Call
Vicor will be holding its investor conference call, today, Tuesday,
November 3, 2009, at 5:00 p.m. Eastern Time. Shareholders interested in
participating in the call should call 800-591-6930 at approximately 4:50
p.m. and use the Passcode 21908962. Internet users can listen to a
real-time audio broadcast of the conference call on the Investor Relations
section of Vicor's website at www.vicorpower.com/irwebcast. Please go to
the website at least 15 minutes prior to the call to register, download and
install any necessary software. For those who cannot participate in the
conference call, a replay will be available, shortly after the conclusion
of the call, through November 18, 2009. The replay dial-in number is
888-286-8010 and the Passcode is 64647193. In addition, a webcast replay
of the conference call will also be available on the Investor Relations
section of Vicor's website at www.vicorpower.com/irwebcast beginning
shortly after the conclusion of the call.
This press release contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Any
statement in this press release that is not a statement of historical fact
is a forward-looking statement, and, the words "believes," "expects,"
"anticipates," "intend," "estimate," "plans," "assumes," "may," "will,"
"would," "should," "continue," "prospective," "project," and other similar
expressions identify forward-looking statements. Forward-looking
statements also include statements regarding bookings, shipments, revenue,
profitability, and the Company's capital resources. These statements are
based upon the Company's current expectations and estimates as to the
prospective events and circumstances that may or may not be within the
Company's control and as to which there can be no assurance. Actual
results could differ materially from those projected in the forward-looking
statements as a result of various factors, including those economic,
business, operational and financial considerations set forth in the
Company's Annual Report on Form 10-K for the year ended December 31, 2008,
under Part I, Item I -- "Business," under Part I, Item 1A -- "Risk
Factors," under Part I, Item 3 -- "Legal Proceedings," and under Part II,
Item 7 -- "Management's Discussion and Analysis of Financial Condition and
Results of Operations." The risk factors set forth in the Annual Report on
Form 10-K may not be exhaustive. Therefore, the information contained in
the Annual Report on Form 10-K should be read together with other reports
and documents the Company files with the Securities and Exchange Commission
from time to time, including Forms 10-Q, 8-K and 10-K, which may
supplement, modify, supersede or update those risk factors. The Company
does not undertake any obligation to update any forward-looking statements
as a result of future events or developments.
Vicor Corporation designs, develops, manufactures and markets modular power
components and complete power systems based upon a portfolio of patented
technologies. Headquartered in Andover, Massachusetts, Vicor sells its
products primarily to the electronic data processing, industrial control,
military electronics and telecommunications markets.
VICOR CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
(Thousands except for per share amounts)
QUARTER ENDED NINE MONTHS ENDED
(Unaudited) (Unaudited)
-------------------- --------------------
SEPT 30, SEPT 30, SEPT 30, SEPT 30,
2009 2008 2009 2008
--------- --------- --------- ---------
Net revenues $ 47,746 $ 51,278 $ 148,821 $ 154,044
Cost of revenues 27,078 29,375 83,724 88,568
--------- --------- --------- ---------
Gross margin 20,668 21,903 65,097 65,476
Operating expenses:
Sales & administration 11,625 13,703 36,467 41,730
Research & development 7,831 7,801 23,193 23,392
Severance charges 126 0 4,083 0
Gain from litigation-
related and other
settlements, net (846) 0 (846) (177)
--------- --------- --------- ---------
Total operating
expenses 18,736 21,504 62,897 64,945
--------- --------- --------- ---------
Income from operations 1,932 399 2,200 531
Other income (expense), net 251 271 562 1,941
--------- --------- --------- ---------
Income before income taxes 2,183 670 2,762 2,472
Provision (benefit) for income
taxes 193 (527) 1,165 65
Loss from equity method
investment, net of tax 0 87 0 1,049
--------- --------- --------- ---------
Consolidated net income 1,990 1,110 1,597 1,358
Less: Net income attributable
to noncontrolling interest 299 501 1,108 1,452
--------- --------- --------- ---------
Net income (loss) attributable
to Vicor Corporation $ 1,691 $ 609 $ 489 ($ 94)
========= ========= ========= =========
Net income (loss) per share
attributable to Vicor
Corporation:
Basic $ 0.04 $ 0.01 $ 0.01 ($ 0.00)
Diluted $ 0.04 $ 0.01 $ 0.01 ($ 0.00)
Shares outstanding:
Basic 41,665 41,660 41,665 41,646
Diluted 41,675 41,685 41,668 41,646
VICOR CORPORATION
CONSOLIDATED BALANCE SHEET
(Thousands)
SEPT 30, DEC 31,
2009 2008
(Unaudited) (Unaudited)
----------- -----------
Assets
Current assets:
Cash and cash equivalents $ 35,895 $ 22,639
Restricted cash equivalents 377 176
Short-term investments 706 1,773
Accounts receivable, net 27,838 28,757
Inventories, net 22,190 26,681
Deferred tax assets 451 451
Other current assets 2,986 2,279
----------- -----------
Total current assets 90,443 82,756
Restricted cash and cash equivalents 210 561
Long-term investments 35,385 35,661
Property and equipment, net 45,023 48,254
Other assets 5,052 4,690
----------- -----------
$ 176,113 $ 171,922
=========== ===========
Liabilities and Equity
Current liabilities:
Accounts payable $ 6,625 $ 5,592
Accrued compensation and benefits 6,269 6,783
Accrued severance charge 813 0
Other accrued liabilities 2,788 4,422
Deferred revenue 2,069 662
----------- -----------
Total current liabilities 18,564 17,459
Long-term deferred revenue 1,300 1,118
Long-term income taxes payable 280 259
Deferred income taxes 1,649 1,660
Equity:
Vicor Corporation stockholders' equity:
Capital stock 162,096 161,591
Retained earnings 110,663 110,174
Accumulated other comprehensive (loss)
income (1,364) (2,767)
Treasury stock (121,827) (121,827)
----------- -----------
Total Vicor Corporation
stockholders' equity 149,568 147,171
Noncontrolling interest 4,752 4,255
----------- -----------
Total equity 154,320 151,426
----------- -----------
$ 176,113 $ 171,922
=========== ===========