ANDOVER, MA -- (MARKET WIRE) -- October 23, 2006 --Vicor Corporation (
NASDAQ:
VICR) today reported
its financial results for the third quarter ended September 30, 2006.
Revenues for the quarter increased to $46,932,000 compared to $45,298,000
for the corresponding period a year ago. Net income for Q3 was $2,462,000,
or $.06 per diluted share compared to net income of $1,708,000, or $.04 per
diluted share, in Q3 2005.
For the nine months ended September 30, 2006 revenues increased to
$144,014,000 from $133,057,000 for the same period of 2005. The Company
reported net income for the period of $8,412,000, or $.20 per diluted share
compared to net income of $1,836,000 or $.04 per diluted share in 2005.
Gross margin improved to 42.5% in Q3 2006 from 42.0% in Q3 2005 and
decreased on a sequential basis from 42.9% in Q2 2006. The book-to-bill
ratio for Q3 2006 was 1.00:1 as compared to 0.86:1 in Q2 2006. Backlog at
the end of Q3 2006 was $39.3 million as compared to $38.6 million at the
end of 2005.
In Q3 2006, the Company recorded $173,000 for expensing stock-based
compensation in accordance with Statement of Financial Accounting Standards
No. 123 (revised 2004) (FAS 123R).
Commenting on the third quarter, Vicor's CEO Patrizio Vinciarelli noted:
"Demand improved in Q3 from the lackluster level in Q2 as orders increased
by approximately 11%. In Q3 we continued to experience delays in certain
significant orders projected to be booked in that quarter. As in Q2, these
delays caused the book-to-bill and revenue levels to be short of
expectations."
Vinciarelli went on to say: "The slow down that Vicor experienced beginning
in Q2 has now been seen by other component manufacturers selling to the
electronics industry at large. Customers continue to say that their orders
have slipped by only a few months. However, the slow down may reflect more
than an inventory correction. Aside from soft demand for Vicor bricks, a
significant V-I Chip program has, for a second time, been delayed by 6
months.
"Given the revenue shortfall, Q3 margins were generally in line with
expectations. Subject to increasing demand, we expect planned productivity
improvements to support a resumption of incremental quarterly expansion in
margins and overall profitability. In Q3, V-I Chip and Picor made progress
with their product roadmaps and in major engagements with key customers.
These developments may contribute top line growth and further improvements
to the bottom line starting in the 2nd half of 2007."
Depreciation and amortization in Q3 was $3.3 million and capital additions
were $1.3 million. For the first nine months of 2006 depreciation and
amortization was $10.6 million and capital additions were $4.2 million.
This compares to $12.8 million and $6.6 million, respectively for the first
nine months of 2005. Cash and short and long-term investments decreased by
$9.2 million in Q3, to approximately $116.4 million from $125.6 million at
the end of Q2 2006. During the quarter the Company paid a dividend of
approximately $6.3 million and repurchased 538,000 shares, for
approximately $5.9 million. During the first nine months of 2006 the
Company has paid approximately $11.3 million in dividends and repurchased
825,700 shares, for approximately $10.8 million. At the end of Q3 2006
there was approximately $8.5 million remaining in the authorized stock
buy-back plan.
In 2006, the tax provision included estimated income taxes for federal and
state taxes for certain minority-owned subsidiaries that are not part of
the Company's consolidated income tax returns, for the Federal alternative
minimum tax and for estimated income taxes due in various state and
international taxing jurisdictions. In the third quarter of 2006, the
Company reduced its tax reserves by $468,000 due to closing tax periods in
certain jurisdictions.
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, Monday, October
23, 2006 at 5:00 p.m. Eastern Time. Shareholders interested in
participating in the call, should call 888-482-0024 at approximately 4:50
p.m. and use the Passcode 65829008. 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 a replay
will be available, shortly after the conclusion of the call, through
November 6, 2006. The replay dial-in number is 888-286-8010 and the
Passcode is 54982045. 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 as that term
is defined in the Private Securities Litigation Reform Act of 1995. You
can identify these statements by our use of the words "may," "will,"
"would," "should," "plans," "expects," "anticipates," "believes,"
"continue," "estimate," "prospective," "project," "intend," and similar
expressions. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from
those projected or anticipated. These risks and uncertainties include our
ability to develop and market new products and technologies
cost-effectively, to leverage design wins into increased product sales, to
decrease manufacturing costs, to enter into licensing agreements that
amplify the market opportunity and accelerate market penetration, to
realize significant royalties under license agreements, to achieve a
sustainable increased bookings rate over a longer period, to hire key
personnel and build our business units, and to successfully leverage the
V-I Chips in standard products to promote market acceptance of Factorized
Power, factors impacting the company's various end markets, including
Consumer Electronics, Communications, Information Technology and
Automotive, as well as those risks and uncertainties identified in the
Company's Annual Report on Form 10-K. The risk factors contained in the
Annual Report on Form 10-K may not be exhaustive. Therefore, the
information contained in that Form 10-K should be read together with other
reports and documents that the Company files with the SEC from time to
time, which may supplement, modify, supersede or update those risk factors.
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 communications, information technology,
industrial control and military electronics 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,
2006 2005 2006 2005
--------- --------- ---------- ---------
Net revenues $ 46,932 $ 45,298 $ 144,014 $ 133,057
Cost of sales 26,981 26,284 81,852 81,419
--------- --------- ---------- ---------
Gross margin 19,951 19,014 62,162 51,638
Operating expenses:
Sales & administration 11,225 10,144 33,796 30,385
Research & development 7,961 7,590 23,531 22,066
Gain from litigation-related
settlement, net 0 0 0 (2,250)
--------- --------- ---------- ---------
Total operating expenses 19,186 17,734 57,327 50,201
Income from operations 765 1,280 4,835 1,437
--------- --------- ---------- ---------
Other income (expense), net 1,318 261 3,787 938
--------- --------- ---------- ---------
Income before income taxes 2,083 1,541 8,622 2,375
(Benefit) provision for income
taxes (379) (167) 210 539
--------- --------- ---------- ---------
Net income $ 2,462 $ 1,708 $ 8,412 $ 1,836
========= ========= ========== =========
Net income per share:
Basic $ 0.06 $ 0.04 $ 0.20 $ 0.04
Diluted $ 0.06 $ 0.04 $ 0.20 $ 0.04
Shares outstanding:
Basic 41,703 41,912 41,932 41,896
Diluted 41,771 42,093 42,212 42,049
VICOR CORPORATION
CONSOLIDATED BALANCE SHEET
(Thousands)
SEPT 30, DEC 31,
2006 2005
(Unaudited) (Unaudited)
============= =============
Assets
Current assets:
Cash and cash equivalents $ 28,376 $ 34,024
Short-term investments 87,971 88,692
Accounts receivable, net 30,101 28,072
Inventories, net 20,931 17,168
Deferred tax assets 2,673 2,673
Other current assets 2,359 2,518
------------- -------------
Total current assets 172,411 173,147
Long-term investments 0 3,348
Property and equipment, net 53,358 59,114
Other assets 8,329 10,146
------------- -------------
$ 234,098 $ 245,755
============= =============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 7,728 $ 8,741
Accrued compensation and benefits 4,839 4,583
Other accrued liabilities 5,585 9,438
------------- -------------
Total current liabilities 18,152 22,762
Deferred income taxes 3,259 3,172
Minority interests 3,448 3,031
Stockholders' equity:
Capital stock 158,337 152,122
Retained earnings 172,729 175,660
Treasury stock (121,827) (110,992)
------------- -------------
Total stockholders' equity 209,239 216,790
------------- -------------
$ 234,098 $ 245,755
============= =============
Contact Information: For further information contact:
Mark A. Glazer
Chief Financial Officer
Vicor Corporation
Tel: 978-470-2900
Fax: 978-749-3439