VICR Vicor Corp

Vicor Corporation (NASDAQ: VICR) today reported financial results for the fourth quarter and year ended December 31, 2018.  These results will be discussed later today at 5:00 p.m. (Eastern Time) during management’s quarterly investor conference call.  The details for accessing the call are presented below. 

Revenues for the fourth quarter ended December 31, 2018 totaled $73.7 million, a 25.4% increase from $58.8 million for the corresponding period a year ago, and a 5.5% sequential decrease from $78.0 million for the third quarter of 2018. Revenues for the year ended December 31, 2018 were $291.2 million, an increase of 27.8% from $227.8 million the prior year. 

Gross margin increased to $33.9 million for the fourth quarter of 2018, compared to $26.9 million for the corresponding period a year ago, and decreased sequentially from $39.0 million for the third quarter of 2018.  Gross margin, as a percentage of revenue, increased to 45.9% for the fourth quarter of 2018, compared to 45.8% for the corresponding period a year ago and decreased from 50.0% for the third quarter of 2018. 

Net income for the fourth quarter was $6.9 million, or $0.17 per diluted share, compared to net income of $1.6 million, or $0.04 per share, for the corresponding period a year ago, and net income of $13.0 million, or $0.32 per diluted share, for the third quarter of 2018.  Net income for 2018 was $31.7 million, or $0.78 per diluted share, compared to net income of $167,000, or $0.00 per diluted share, for the prior year.          

Cash and cash equivalents sequentially increased by $2.4 million to approximately $70.6 million at the end of the fourth quarter of 2018, from $68.2 million at the end of the third quarter of 2018.  Capital expenditures for the fourth quarter totaled $11.3 million, up from $3.3 million for the third quarter and $2.4 million for the corresponding period a year ago.

Fourth quarter bookings decreased 15.2% to $60.5 million, from $71.3 million for the corresponding period a year ago, and decreased sequentially 33.6% from $91.1 million for the third quarter of 2018. Total backlog at the end of the fourth quarter of 2018 was $103.0 million, up 41% from $73.1 million at the end of 2017. 

Commenting on the fourth quarter, Dr. Patrizio Vinciarelli, Chief Executive Officer, stated: “Our Q4 results reflect sudden headwinds including temporary softness in data center spending and the impact of tariffs on imports by China.  Our revenue was lower than forecast as orders were delayed and deliveries rescheduled. Lower production volumes and inefficiency caused by shifting mix caused a sequential decline in gross margins. Nevertheless, year-over-year Vicor recorded a 28% increase in revenue and a 41% increase in backlog.”

Dr. Vinciarelli continued: “AI ASICs and GPUs drawing hundreds of Amperes below 1 Volt are adopting Vicor’s Power-on-Package™ (“PoP”) solutions.  PoP design-in activity using MCMs recently took on a new dimension with design wins leveraging Geared MCMs, or “GCMs”. By providing efficient Vertical Power Delivery, GCMs support peak currents in the thousands of Amperes fueling the computational power necessary to make AI even smarter. Advanced solutions are extending Vicor’s lead over competition anchored by legacy 12V infrastructure or confused by misinformed claims about GaN.”

“In automotive, Vicor is getting significant traction with OEMs and Tier 1 suppliers challenged by electrification and the advent of the 48V bus. Our value proposition importantly includes the high density and modular flexibility needed by advanced autonomous driving systems. Based on the trajectory of early engagements, we expect that within a few years our growth in the automotive segment will be comparable to the growth we are now experiencing powering AI and servers in datacenters.”   

“In general, across key growth markets, Vicor is recognized for unrivaled technological leadership in high performance power system solutions.  We are addressing major opportunities and scaling up capacity to support forecast production requirements.”

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 as scheduled, on Tuesday, February 26, 2019 at 5:00 p.m. Eastern Time.  Shareholders interested in participating in the call should call 888-339-2688 at approximately 4:50 p.m. and use the Passcode 64676641.  Internet users may listen to a real-time audio broadcast of the conference call on the Investor Relations section of Vicor’s website at www.vicorpower.com.  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 March 13, 2019.  The replay dial-in number is 888-286-8010 and the Passcode is 10247812.  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 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,” “intends,” “estimates,” “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, targeted markets, increase in manufacturing capacity and utilization thereof, future products and capital resources. These statements are based upon management’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 Vicor’s Annual Report on Form 10-K for the year ended December 31, 2017, 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 filed 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.  Vicor 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 to the power systems market, including enterprise and high performance computing, industrial equipment and automation, telecommunications and network infrastructure, vehicles and transportation, aerospace and defense.

For further information contact:                                                      James A. Simms, Chief Financial OfficerVoice: 978-470-2900Facsimile: 978-749-3439invrel@vicorpower.com  

VICOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Thousands except for per share amounts)
	QUARTER ENDED								YEAR ENDED
	(Unaudited)								(Unaudited)
	DEC 31,				DEC 31,				DEC 31,			DEC 31,
	2018				2017				2018			2017
Net revenues	$ 73,720				$ 58,771				$ 291,220			$ 227,830
Cost of revenues		39,847				31,840				152,249			126,174
Gross margin		33,873				26,931				138,971			101,656
Operating expenses:
Selling, general and administrative		15,731				15,033				62,224			58,092
Research and development		11,066				11,442				44,286			44,924
Severance and other charges		62				-				402			-
Total operating expenses		26,859				26,475				106,912			103,016
Income (loss) from operations		7,014				456				32,059			(1,360	)
Other income (expense), net		256				268				874			1,262
Income (loss) before income taxes		7,270				724				32,933			(98	)
Less:  (Benefit) provision for income taxes		363				(895	)			1,087			(356	)
Consolidated net income		6,907				1,619				31,846			258
Less:  Net income (loss) attributable to
noncontrolling interest		(3	)			8				121			91
Net income attributable to
Vicor Corporation	$6,910				$1,611				$31,725			$167
Net income per share attributable
to Vicor Corporation:
Basic	$0.17				$0.04				$0.80			$0.00
Diluted	$0.17				$0.04				$0.78			$0.00
Shares outstanding:
Basic		40,182				39,383				39,872			39,228
Diluted		40,981				40,135				40,729			39,933

 

VICOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Thousands)
	DEC 31,				DEC 31,
	2018				2017
	(Unaudited)				(Unaudited)
Assets
Current  assets:
Cash and cash equivalents	$	70,557			$	44,230
Accounts receivable, net		43,673				34,487
Inventories, net		47,370				36,499
Other current assets		3,460				3,616
Total current assets		165,060				118,832
Long-term deferred tax assets		265				210
Long-term investment, net		2,526				2,525
Property, plant and equipment, net		50,432				41,356
Other assets		2,785				2,801
Total assets	$	221,068			$	165,724
Liabilities and Equity
Current liabilities:
Accounts payable	$	16,149			$	9,065
Accrued compensation and benefits		10,657				9,891
Accrued expenses		2,631				2,989
Sales allowances		548				-
Accrued severance and other charges		234				-
Income taxes payable		710				300
Deferred revenue		5,069				5,791
Total current liabilities		35,998				28,036
Long-term deferred revenue		232				303
Contingent consideration obligations		408				678
Long-term income taxes payable		238				195
Other long-term liabilities		102				93
Total liabilities		36,978				29,305
Equity:
Vicor Corporation stockholders' equity:
Capital stock		193,977				181,914
Retained earnings		129,000				93,605
Accumulated other comprehensive loss		(394	)			(478	)
Treasury stock		(138,927	)			(138,927	)
Total Vicor Corporation stockholders' equity		183,656				136,114
Noncontrolling interest		434				305
Total equity		184,090				136,419
Total liabilities and equity	$	221,068			$	165,724