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Vishay's Profit Rises

Margins and revenue improve. Guidance falls short though.

Vishay Intertechnology (VSH) - Get Vishay Intertechnology, Inc. Report announced that its third-quarter profit rose 63% helped by stronger margins and better sales, while guidance fell short of expectations.

The chipmaker earned $32.48 million or 17 cents a share, compared with $19.2 million or 11 cents a share, a year ago. Third-quarter earnings were hurt by various items that trimmed earnings by 10 cents a share. Analysts surveyed by Thomson First Call were estimating earnings of 28 cents a share.

The third-quarter revenue rose 15.6% from the year-ago quarter to $654.4 million as against analysts' expectation of $661.06 million.

For the fourth quarter, the company expects revenue to be between $620 million to $640 million as against analysts' expectation of $678.52 million.

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Gross margin for the latest quarter improved about 160 basis points to 25.6%. Operating margins rose 140 basis points to 7.2% from a year-ago period.

"Our results were in line with our expectations," the company said. "While orders from distribution to Vishay slowed down as anticipated, the sales by distributors to their end customers did not. In the current pricing environment, we were able to pursue our programs of selective price increases, which resulted in basically flat pricing overall on a sequential basis. ... Free cash flows from operations for the third quarter 2006 were $98 million and capital expenditures were $45 million; for the nine months ended September 2006 cash flows from operations were $228 million and capital expenditures were $115 million."

The company's shares were trading down 41 cents, or 2.87%, at $13.90 Tuesday.

This story was created through a joint venture between TheStreet.com and IRIS.