OREANDA-NEWS. Vishay Precision Group, Inc. (NYSE: VPG), a leading producer of precision sensors and systems, today announced its results for its fiscal 2016 first quarter ended April 2, 2016.

Highlights:

  • First quarter net revenues of $56.6 million.
  • First quarter adjusted diluted earnings per share of $0.13.
  • New products – advanced sensors’ revenue grew approximately 95% in the first quarter 2016 from the first quarter 2015, and approximately 42% from the fourth quarter 2015.
  • Fiscal year 2016 adjusted diluted earnings per share reaffirmed - in the range of $0.80 to $1.00 - at constant exchange rates as of the first quarter of 2016.
  • Announced Pacific Instruments acquisition, a designer and manufacturer of high?performance data acquisition systems.

Ziv Shoshani, VPG’s chief executive officer said, “Revenues this quarter, which are flat compared with our first quarter 2015 revenues, included the effects of the weak global steel environment and a $1.2 million negative foreign exchange rate impact versus last year’s first quarter, due to the strengthening of the U.S. dollar. While global economic conditions remain soft, we are encouraged that our consolidated book-to-bill increased sequentially to 1.03, from 0.95 in the fourth quarter of 2015.”

Net revenues for the first quarter of 2016 were $56.6 million, flat compared with $56.6 million of net revenues for the prior year period. Comparing sequential results, net revenues for the first quarter of 2016 decreased by $2.3 million, or 3.9%, from $58.9 million in the fourth quarter of 2015.

Net earnings attributable to VPG stockholders for the first quarter of 2016 were $0.5 million, or $0.04 per diluted share, compared to net earnings attributable to VPG stockholders for the first quarter of 2015 of $0.9 million, or $0.06 per diluted share.

The following table reconciles the company's non-U.S. GAAP measures included in the press release, which are provided for comparison with other results, and the most directly comparable U.S. GAAP measures:

         
Reconciliation of Adjusted Earnings Per Share        
(Unaudited - In thousands, except per share data)        
         
    Fiscal quarter ended
   

April 2,
2016

  

March 28,
2015
Net earnings attributable to VPG stockholders   $ 480     $ 860
         

Reconciling items affecting operating margin

        
Acquisition purchase accounting adjustments     296       —
Acquisition costs     62       —
Restructuring costs     675       78
         

Reconciling items affecting income tax expense

        
Tax effect of adjustments for purchase accounting, acquisition costs, restructuring costs, and discrete tax item     (179 )     16
Adjusted net earnings attributable to VPG stockholders   $ 1,692     $ 922
         
Adjusted net earnings per diluted share   $ 0.13     $ 0.07
         
Weighted average shares outstanding - diluted     13,399       13,960
         

Segments

The Foil Technology Products segment revenues were $26.3 million in the first quarter of 2016, up 5.0% from $25.1 million in the first quarter last year, and up 0.3% from $26.2 million in the fourth quarter of 2015. The gross margin for the segment increased to 42.3% for the first quarter of 2016 compared to 41.4% in the first quarter last year, and up from 36.5% in the fourth quarter of 2015. The gross margin increased from the comparable prior year period primarily due to higher volume. The sequential gross margin increase was primarily due to the realization of savings related to our previously announced cost reduction programs and fourth quarter adjustments.

The Force Sensors segment revenues of $14.8 million in the first quarter of 2016 were down 2.6% compared to $15.2 million in the first quarter last year, and were down 4.8% from $15.6 million in the fourth quarter of 2015. Decreased year-over-year revenues are attributable primarily to $0.3 million of negative exchange rate impact. The decrease in sequential revenues is attributable to lower volume. The gross margin for the segment was 18.4% in the first quarter of 2016 versus 21.8% in the first quarter of 2015, and 20.2% in the fourth quarter of 2015. The gross margin for the quarter decreased from the comparable prior year period primarily due to a reduction in inventory. The sequential gross margin decrease is mainly due to lower volume.

The Weighing and Control Systems segment revenues were $15.5 million in the first quarter of 2016, down 5.1% from $16.3 million in the first quarter last year, and down 9.4% from $17.1 million in the fourth quarter of 2015. Decreased year-over-year revenues were attributable to $0.8 million of negative foreign exchange rate effects and a slowdown in the steel industry, partially offset by the acquisition of Stress-Tek. The sequential decrease is attributable to lower volume in the steel industry, process weighing in Europe, and onboard weighing in the U.S., partially offset by the acquisition of Stress-Tek. The gross margin for the segment was 38.3% in the first quarter of 2016 (40.2% excluding the Stress-Tek acquisition purchase accounting adjustments of $0.3 million) versus 44.6% in the first quarter of 2015 and 47.0% in the fourth quarter of 2015 (47.8% excluding the KELK acquisition purchase accounting adjustment of $0.1 million). The year-over-year decrease in gross margin is primarily due to the negative effects of foreign exchange rates and unfavorable product mix. Sequentially, gross margin decreased due to lower volume.

Outlook

Mr. Shoshani concluded, “In light of global economic conditions, we expect net revenues in the range of $57 million to $62 million for the second quarter of 2016. We are reaffirming our expectation for fiscal year 2016 adjusted diluted earnings per share to be in the range of $0.80 to $1.00, at constant exchange rates as of the first quarter of 2016.”

Conference Call and Webcast

A conference call will be held today (May 10, 2016) at 10:00 a.m. EDT (9:00 a.m. CDT). To access the conference call, interested parties may call 1-888-317-6003 or internationally 1-412-317-6061 and use passcode 1939174, or log on to the investor relations page of the VPG website at www.vpgsensors.com.

A replay will be available approximately one hour after the completion of the call by calling toll-free 1-877-344-7529 or internationally 1-412-317-0088 and by using the passcode: 10079715. The replay will also be available on the investor relations page of the VPG website at www.vpgsensors.com for a limited time.