Annual Report
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VISHAY INTERTECHNOLOGY, INC. INTERTECHNOLOGY, VISHAY www.vishay.com 2017 ANNUAL REPORT VISHAY INTERTECHNOLOGY, INC. 2017 ANNUAL REPORT CORPORATE HEADQUARTERS 63 Lancaster Avenue Malvern, PA 19355-2120 United States P 610.644.1300 F 610.296.0657 www.vishay.com © Copyright 2018 Vishay Intertechnology, Inc. ® Registered trademarks of Vishay Intertechnology, Inc., and other parties. All rights reserved. www.vishay.com VISHAY INTERTECHNOLOGY, INC. CORPORATE 2017 INFORMATION BOARD OF DIRECTORS EXECUTIVE OFFICERS STOCKHOLDER Marc Zandman Marc Zandman ASSISTANCE SALES BY SALES BY Executive Chairman of the Board Executive Chairman of the Board Chief Business Development Officer Chief Business Development Officer For information about stock transfers, Vishay Intertechnology, Inc. Dr. Gerald Paul dividend payments, address changes, SEGMENT REGION Dr. Abraham Ludomirski President account consolidation, registration changes, Founder and Managing Director of Chief Executive Officer lost stock certificates, and Form 1099, please Vitalife Fund, a venture capital company contact the Company’s Transfer Agent and OPTOELECTRONIC Johan Vandoorn specializing in high tech electronic Registrar. COMPONENTS medical devices Executive Vice President Chief Technical Officer Transfer Agent and Registrar Frank D. Maier Deputy to the CEO 11% Retired Managing Director American Stock Transfer & Trust Company TEMIC GmbH Lori Lipcaman 59 Maiden Lane Executive Vice President New York, NY 10038 Dr. Gerald Paul Chief Financial Officer Phone: 800-937-5449 President Fax: 718-921-8331 42% Chief Executive Officer David Valletta Email: [email protected] ASIA 32% Vishay Intertechnology, Inc. Executive Vice President For other information or questions, please RESISTORS/ 24% 23% Worldwide Sales INDUCTORS DIODES AMERICAS Ronald M. Ruzic contact Investor Relations at 610-644-1300. Retired Group President Clarence Tse BorgWarner Automotive, Inc. Executive Vice President Common Stock Business Head Semiconductors 15% Ziv Shoshani Ticker symbol: VSH CAPACITORS 18% President Joel Smejkal The common stock is listed and 35% principally traded on the New MOSFETs EUROPE Chief Executive Officer Executive Vice President Vishay Precision Group, Inc. Business Head Passive Components York Stock Exchange. Timothy V. Talbert Werner Gebhardt Senior Vice President Executive Vice President Duplicate Mailings Credit and Originations Lease Corporation Human Resources If you receive more than one Annual Report of America (“LCA”) and Proxy Statement and wish to help President us reduce costs by discontinuing multiple LCA Bank Corporation mailings, please contact our Transfer Agent Thomas C. Wertheimer CORPORATE OFFICE American Stock Transfer & Trust Company. Accounting Consultant, Vishay Intertechnology, Inc. previously partner of 63 Lancaster Avenue PricewaterhouseCoopers LLP Malvern, PA 19355-2120 Electronic Proxy Materials SALES BY SALES BY Phone: 610-644-1300 You can receive Vishay Intertechnology’s Ruta Zandman Fax: 610-296-0657 Annual Report and proxy materials Private Stockholder www.vishay.com electronically, which will give you immediate END MARKET CHANNEL Vishay Intertechnology, Inc. access to these materials, and will save the Company printing and mailing costs. If you Raanan Zilberman are a registered holder (you own the stock in President ANNUAL MEETING your name), and wish to receive your proxy Chief Executive Officer May 15, 2018 at 9:30 a.m. materials electronically, please go to www. Caesarstone Ltd. Vishay Intertechnology, Inc. icsdelivery.com/vsh. Auditorium If you are a street holder (you own this stock 63 Lancaster Avenue through a bank or broker), please contact HONORARY EXECUTIVE Malvern, PA 19355-2120 your broker and ask for electronic delivery of 28% 57% Vishay Intertechnology’s proxy materials. AUTOMOTIVE 36% DISTRIBUTION CHAIRMAN OF THE BOARD INDUSTRIAL Dr. Felix Zandman 7% (Deceased June 4, 2011) CONSUMER 6% EMS 8% COMPUTING 6% 36% 7% 4% 5% POWER SUPPLIES OEM TELECOMMUNICATIONS MILITARY / AEROSPACE MEDICAL MARC ZANDMAN DR. GERALD PAUL Executive Chairman Chief Executive Officer of the Board EXECUTIVE CHIEF EXECUTIVE CHAIRMAN OFFICER After a successful performance in 2016, Vishay had an even better year in 2017. During the course of 2017, Vishay sales and profits increased significantly, making Our success during 2017 was driven by favorable economic conditions in all the year a very successful one for the Company. We experienced a high level of regions. We demonstrated our confidence in our strong long-term cash flow demand for our components in virtually all market segments. With its performance generation and strong balance sheet by authorizing a $150 million stock buyback driven by increased sales volume, Vishay clearly demonstrated its ability to leverage program, of which we spent approximately $40 million in 2017. We also increased its business model. We increased manufacturing capacities for key product lines, our quarterly cash dividend. These actions reflected continued confidence in our and continue to do so, mainly by pulling forward certain programs of our five-year ability to enhance total stockholder return over the long term and our commitment Growth Plan. Another positive achievement was Vishay’s generation of “free cash,” to doing so. which continued to be excellent. In 2017, Vishay generated “free cash” of $200 million, our best performance in six years. Vishay declared quarterly dividends in February, May, August, and November 2017. The dividend of $0.0675 declared in November reflected an 8% increase over the During the year, business conditions in all regions significantly exceeded our previous quarter’s dividend. expectations. This is especially true for our key markets, automotive and industrial. Market demand exceeded available capacity in several of our product lines, which In February 2017, Vishay appointed Mr. Raanan Zilberman to its Board of Directors. led to stretched lead times and increased backlogs. Asian markets were very Raanan offers significant business experience to our Board, particularly in light strong, particularly for industrial equipment, energy infrastructure, and automotive of his leadership experience as CEO of several organizations with international equipment. European manufacturers in the automotive and industrial segments operations and reach. Raanan also brings to the Board familiarity with the Vishay were able to capitalize on their traditional strengths. During the course of the year, organization because of his tenure, from 2002 through 2004, as President of the business conditions in American markets improved steadily. Vishay Transducers business following Vishay’s acquisition of Tedea Huntleigh. We are excited about the opportunities that accelerated market growth offer Vishay, During the 56 years since Vishay was founded in 1962, advances in technology especially in automotive and industrial applications. have had a profound impact on society. Our smartphones are also computers that can outperform the large mainframe machines that were used in 1962. Complex The stock repurchase authorization announced by Vishay in August 2017 electronic control systems in automobiles manage practically all key functions. demonstrated our confidence in our long-term cash flow and strong balance sheet. Meanwhile, Internet of Things technology is in the process of changing the face of It clearly showed that we are able to continue to invest in our Growth Plan and manufacturing and commerce. return capital to stockholders. One thing that has not changed over the years is Vishay’s position as a technology In 2017, we were once again able to offset the negative impact of inflation and price leader, especially in the automotive and industrial growth markets. Our components decline on our contributive margin through cost reduction and innovation. are used in virtually all major market sectors. Vishay has remained an industry Over the years, Vishay has consistently done well during both upturns and leader because it has remained strong and continued to innovate. downturns in the global economy. Regardless of short-term trends, and whatever As I look forward to continued success in 2018 and beyond, I thank all Vishay 2018 might bring, I am confident that Vishay will continue on a positive course. employees for their commitment to the company. I also thank our customers, vendors, With that in mind, I thank all Vishay’s employees, customers, vendors, strategic strategic business partners, and stockholders for their confidence and support. business partners, and stockholders for their faith in Vishay. Vishay Intertechnology 1 COMPANY ROOTS THE COMPANY Dr. Felix Zandman, with a loan from his cousin Alfred P. Slaner, founded Vishay in 1962 to develop and manufacture Bulk Metal® foil resistors. GLOBAL INDUSTRY LEADER The Company was named after Dr. Zandman’s ancestral village in Vishay passive components and semiconductors are used by Lithuania, in memory of family members who perished in the Holocaust. virtually all major manufacturers of electronic products worldwide, When Dr. Zandman passed away in 2011, he left a lasting legacy. His in the industrial, power supply, automotive, military, aerospace, high standards and values are embedded in Vishay’s culture. They medical, computing, telecommunications, and consumer markets. positively influence the ethical business practices implemented by Vishay Vishay components are found inside the products and systems personnel across the globe every day. used every day, from automobiles to airplanes