SOURCE: Vicor Corporation

October 21, 2014 16:05 ET

Vicor Corporation Reports Results for Third Quarter Ended September 30, 2014; Announces Appointment of H. Allen Henderson to Board of Directors

ANDOVER, MA--(Marketwired - Oct 21, 2014) -  Vicor Corporation (NASDAQ: VICR) today reported financial results for the third quarter and nine months ended September 30, 2014. These results will be discussed later today at 5:00 p.m. Eastern Time, during management's quarterly investor conference call. The details for the call are presented below. In addition, the Company announced today the appointment of H. Allen Henderson to its Board of Directors, effective October 18, 2014. Concurrent with approval of Mr. Henderson's appointment, the Board also approved the expansion of the Board to 10 members.

Revenues for the third quarter ended September 30, 2014, increased to $58,402,000, compared to $55,091,000 for the corresponding period a year ago, and increased from $53,361,000 for the second quarter of 2014. Third quarter bookings increased to $65,559,000 from $57,061,000 for the corresponding period a year ago and from $57,579,000 for the second quarter of 2014.

Gross margin increased to $25,550,000 for the third quarter of 2014, compared to $22,980,000 for the corresponding period a year ago, and increased from $22,662,000 for the second quarter of 2014. Gross margin, as a percentage of revenue increased to 43.7% for the third quarter of 2014 compared to 41.7% for the third quarter of 2013, and increased on a sequential basis from 42.5% for the second quarter of 2014. 

Net loss for the third quarter was ($3,674,000), or ($0.10) per share, compared to a net loss of ($932,000), or ($0.02) per share, for the corresponding period a year ago and a net loss of ($4,835,000), or ($0.13) per share, for the second quarter of 2014. Included in the net loss in the third quarter was approximately $3,100,000 in legal fees related to ongoing litigation of IP claims by a competitor, and of our counter-claims, and a pre-tax charge of approximately $2,000,000 for the cost of severance and other employee-related costs, associated with the consolidation of Sunnyvale, CA manufacturing operations to Andover, MA by the end of 2014.

Revenues for the nine months ended September 30, 2014, increased by 14.7% to $164,996,000 from $143,902,000 for the corresponding period a year ago. Net loss for the nine month period was ($13,887,000), or ($0.36) per share, compared to a net loss of ($10,538,000), or ($0.27) per share, for the corresponding period a year ago. 

Cash flow from operations totaled $3,672,000 for the third quarter and $1,451,000 for the nine months ended September 30, 2014, compared to $1,536,000 for the corresponding quarter a year ago and cash used in operations of ($2,680,000) for the nine months ended September 30, 2013. Cash and cash equivalents increased by $2,381,000 to approximately $53,186,000 at the end of the third quarter of 2014 from $50,805,000 at the end of the second quarter of 2014.

Total backlog at the end of the third quarter was $52,544,000, compared to $45,648,000 at the end of the second quarter, and $44,659,000 at the end of 2013.

Regarding third quarter performance, Dr. Patrizio Vinciarelli, Chief Executive Officer, commented, "Vicor made progress on several strategic fronts during the quarter, and I am particularly pleased with advances made in new products and production capabilities, as well as the expansion of new customers and applications. As expected, Vicor experienced a meaningful increase in VI Chip and Picor shipments associated with our Factorized Power datacenter solutions. Bookings improved across our business units, rising 14% sequentially. Customers continue to respond favorably to our new products, which offer highly differentiated performance with improving cost-effectiveness." 

"During the third quarter, we initiated the consolidation of our Sunnyvale manufacturing operations into our Andover facilities, reflecting our focus on the development of next generation front-end power systems utilizing ChiPs. Consolidated manufacturing of older generation AC products is both operationally and strategically driven, as it should contribute improved operational efficiency while also enabling our ChiP-based vision of end-to-end Factorized Power systems. At the Electronica trade show in November, Vicor will unveil next generation systems, including AC-DC solutions, based on our 'adapter' platforms, full front end system solutions incorporating ChiP engines within novel packages that are thermally and mechanically adept. These scalable devices, which we have christened 'VIAs' (short for Vicor Integrated Adapters) enable class-leading performance and cost effectiveness, and, with their ease of use, should contribute to accelerated adoption of our power component design methodology across multiple markets. While Andover currently has the capacity to meet near term demand for ChiPs and VIA products, we anticipate pursuing additional capacity to meet expected growth needs." 

Dr. Vinciarelli also stated, "I am pleased to have Allen join our Board, given his nearly three decades of service to the Company and considerable experience in the power systems business." Mr. Henderson, 67, is an officer of the Corporation, serving as a Corporate Vice President. Employed by the Company since 1985, he has been President of the Company's Westcor division since 1999. Mr. Henderson also serves as President of VLT, Inc., a wholly owned subsidiary holding the vast majority of the Company's patents. A veteran of the U.S. Navy, Mr. Henderson received a BAEE from Brown University and a MBA from Duke University. 

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, Tuesday, October 21, 2014 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 10907040. 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 November 5, 2014. The replay dial-in number is 888-286-8010 and the Passcode is 61723940. 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," "intend," "estimate," "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, 2013, 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 primarily to customers in the higher-performance, higher-power segments of the power systems market, including aerospace and defense electronics, enterprise and high performance computing, industrial equipment and automation, telecommunications and network infrastructure, and vehicles and transportation 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,  
    2014     2013     2014     2013  
                                 
                                 
Net revenues   $ 58,402     $ 55,091     $ 164,996     $ 143,902  
Cost of revenues     32,852       32,111       93,992       85,854  
  Gross margin     25,550       22,980       71,004       58,048  
                                 
Operating expenses:                                
  Sales & administration     17,354       14,478       52,367       43,820  
  Research & development     10,345       9,857       31,239       29,700  
  Severance & other charges     1,983       -       1,983       1,361  
    Total operating expenses     29,682       24,335       85,589       74,881  
                                 
Loss from operations     (4,132 )     (1,355 )     (14,585 )     (16,833 )
                                 
Other income (loss), net     (64 )     51       48       12  
                                 
Loss before income taxes     (4,196 )     (1,304 )     (14,537 )     (16,821 )
                                 
Benefit for income taxes     (527 )     (406 )     (510 )     (6,337 )
                                 
Consolidated net loss     (3,669 )     (898 )     (14,027 )     (10,484 )
                                 
Less: Net income (loss) attributable to noncontrolling interest     5       34       (140 )     54  
                                 
Net loss attributable to Vicor Corporation   $ (3,674 )   $ (932 )   $ (13,887 )   $ (10,538 )
                                 
                                 
Net loss per share attributable to Vicor Corporation:                                
  Basic   $ (0.10 )   $ (0.02 )   $ (0.36 )   $ (0.27 )
  Diluted   $ (0.10 )   $ (0.02 )   $ (0.36 )   $ (0.27 )
                                 
Shares outstanding:                                
  Basic     38,552       38,538       38,545       39,414  
  Diluted     38,552       38,538       38,545       39,414  
                                 
                                 
                                 
VICOR CORPORATION  
   
CONSOLIDATED BALANCE SHEET  
(Thousands)  
   
    SEPT 30,     DEC 31,  
    2014     2013  
    (Unaudited)     (Unaudited)  
Assets                
                 
Current assets:                
    Cash and cash equivalents   $ 53,186     $ 56,339  
    Short-term investments     541       463  
    Accounts receivable, net     27,347       27,683  
    Inventories, net     28,119       29,696  
    Deferred tax assets     131       131  
    Other current assets     4,934       4,212  
      Total current assets     114,258       118,524  
                 
Long-term investments     5,134       5,188  
Property and equipment, net     37,601       40,092  
Other assets     1,726       1,836  
                 
    $ 158,719     $ 165,640  
                 
Liabilities and Equity                
                 
Current liabilities:                
    Accounts payable   $ 9,336     $ 8,677  
    Accrued compensation and benefits     9,687       8,055  
    Accrued severance charge     1,933       49  
    Accrued expenses     4,602       2,841  
    Income taxes payable     6       15  
    Deferred revenue     1,732       1,018  
      Total current liabilities     27,296       20,655  
                 
Long-term deferred revenue     703       974  
Long-term income taxes payable     801       1,339  
Deferred income taxes     335       335  
                 
Equity:                
  Vicor Corporation stockholders' equity:                
    Capital stock     171,300       169,984  
    Retained earnings     94,758       108,645  
    Accumulated other comprehensive loss     (555 )     (526 )
    Treasury stock     (138,927 )     (138,927 )
      Total Vicor Corporation stockholders' equity     126,576       139,176  
  Noncontrolling interest     3,008       3,161  
    Total equity     129,584       142,337  
                 
    $ 158,719     $ 165,640  

Contact Information

  • For further information contact:

    James A. Simms
    Chief Financial Officer
    Voice: 978-470-2900
    Facsimile: 978-749-3439
    invrel@vicorpower.com