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Edited Transcript of VPG earnings conference call or presentation 20-Feb-19 3:00pm GMT

Q4 2018 Vishay Precision Group Inc Earnings Call

Malvern Feb 22, 2019 (Thomson StreetEvents) -- Edited Transcript of Vishay Precision Group Inc earnings conference call or presentation Wednesday, February 20, 2019 at 3:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Reynee Tung

Vishay Precision Group, Inc. - Director of Global Marketing Communications

* William M. Clancy

Vishay Precision Group, Inc. - Executive VP & CFO

* Ziv Shoshani

Vishay Precision Group, Inc. - CEO, President & Director

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Conference Call Participants

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* John Edward Franzreb

Sidoti & Company, LLC - Senior Equity Analyst

* Sarkis Sherbetchyan

B. Riley FBR, Inc., Research Division - Associate Analyst

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Presentation

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Operator [1]

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Good morning, and welcome to the VPG 2018 Fourth Quarter and Full Year Results Conference Call. (Operator Instructions) Please note, this event is being recorded.

I would now like to turn the conference over to Ms. Reynee Tung, Director, Global Marketing Communications. Please go ahead.

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Reynee Tung, Vishay Precision Group, Inc. - Director of Global Marketing Communications [2]

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Thank you, operator. Good morning, everyone. Welcome to VPG's 2018 Fourth Quarter Earnings Conference Call. An audio recording will be made of the conference call today, including any questions or comments that participants may contribute. By now you all should have received the earnings press release, and we hope you've taken the time to read through it as it contains important information. You can find it, including relevant non-GAAP reconciliations, on VPG's website at vpgsensors.com. An audio recording of today's call will be available on the Internet for a limited time and can be accessed on the VPG website.

The content of this conference call is owned by VPG and is protected by U.S. and International Copyright Law. You may not make any recordings or other copies of this conference call, and you may not reproduce, distribute, adapt, transmit, display or perform the contents of this conference call in whole or in part without our written permission.

Today's remarks are governed by the safe harbor provisions of the 1995 Private Securities Litigation Reform Act. Actual results, performance or achievements may turn out significantly better or worse than indicated by any forward-looking statements that we may make today. For a more complete discussion of the risks associated with VPG's operations, please refer to our SEC filings, especially the Form 10-K for the year ended December 31, 2017, and our other recent SEC filings.

And now it's my pleasure to introduce the host for today's call, Ziv Shoshani, CEO and President; and Bill Clancy, CFO. Bill?

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [3]

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Thanks, Reynee. Good morning, everyone, and thank you for joining us on our call today. I would like to start by reviewing a few highlights and then summarizing the financials. Following that, Ziv will provide his view of the results and the global business environment.

Referring to Page 3 of the slide deck, we had a good fourth quarter of 2018 with revenues of $77 million, adjusted operating income of $9.9 million, adjusted operating margin of 12.9% and adjusted earnings per diluted share of $0.54. We're pleased with our quarterly performance and also with our fourth quarter cash from operations of $17.4 million and free cash flow of $12.8 million.

On Slide 4, we grew our fourth quarter 2018 revenues by 10.9% to $77.0 million, up $7.5 million compared to $69.4 million of revenues in the fourth quarter of 2017. The negative impact of foreign exchange rates to revenues for the fourth quarter of 2018 as compared to the fourth quarter of 2017 was $1.3 million.

We increased our gross profit margins to 40.0% in comparison to 38.5% in the fourth quarter of 2017. The increase in gross profit of $4.1 million for the fourth quarter of 2018 as compared to the fourth quarter of 2017 was primarily attributable to an increase in volumes of $5.7 million, partially offset by $1 million related to wage increases, $500,000 for supplies and tooling and repairs and maintenance and $200,000 related to the U.S. imposition of tariffs on goods from China.

Selling, general and administrative expenses for the fourth quarter of 2018 were $20.9 million or 27.2% of revenues as compared to $18.8 million or 27.1% for the fourth quarter of 2017. The increase in selling, general and administrative expenses was related to $500,000 of wage increases, $400,000 in bonus reserve adjustments, another $400,000 in commission and travel and $800,000 in professional service fees.

As a result of our regular review of goodwill and indefinite-lived intangible assets during the fourth quarter of each year, we recorded a $2.8 million pretax noncash impairment charge to reduce the carrying value of the goodwill and indefinite-lived intangible assets related to our Pacific Instruments business, which is part of the Foil Technology Products reporting segment. This charge is preliminary and could change as in we finalize and file our 2018 Form 10-K with the SEC.

Looking at operating income on an adjusted basis. We increased our adjusted operating margin by 24.5% to $9.9 million or 12.9% as compared to $8 million or 11.5% in the fourth quarter of last year. The adjusted net earnings attributable to VPG stockholders for the fourth quarter of 2018 increased 37.5% to $7.3 million or $0.54 per diluted share compared to $5.3 million or $0.39 per diluted share in the fourth quarter of 2017.

Foreign currency exchange rates for the fourth quarter of 2018 as compared to the fourth quarter of 2017 increased net earnings by $700,000 or $0.05 per diluted share. We generated free cash flow of $12.8 million for the fourth quarter of 2018 as compared to $5.4 million for the fourth quarter of 2017. We define free cash flow as the amount of cash generated from operations, which was $17.4 million for the fourth quarter of 2018, less capital expenditures which were $4.6 million for the fourth quarter of 2018, net of any proceed on the sale of assets, which were 0 in the fourth quarter of 2018.

Our GAAP tax rate for the year ended December 31, 2018, was 30.4%. We continue to closely monitor the developments relating to the U.S. imposition of tariffs on goods from China and trade regulations and the response by other countries related to the U.S. tariffs. In mid-July, the tariffs went into effect, and we incurred $500,000 of costs related to the tariffs on goods from China in the second half of 2018. For those products that are impacted, we have been working closely with our customers to minimize the impact. And given our current backlog, we expect to see offsetting effects in the coming quarters.

Vishay Advanced Technologies, a subsidiary of Vishay Precision Group Inc., entered into a new lease agreement as detailed in our Form 8-K filing on Tuesday, February 19. This facility will be located in Israel and will allow us to have capacity expansion of our advance sensors product line as well as streamlining operations as we work to ramp up production in a new state-of-the-art facility. Currently, construction is in progress, so we expect to complete moving all the operations to this facility in the second half of 2020.

And on Slide 5, we remain focused on the execution of our core strategy, which continues to prove very effective in achieving these goals outlined on Slide 5.

With that, let me pass further comments on to Ziv.

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [4]

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Thank you, Bill. An important part of our strategy is to grow by developing new product offering. A great example of this is our advance sensor line, which continues to gain adoption. We developed this platform as part of our Foil Technology Products segment, and it has grown nicely as more customers include it in their product design.

We saw our advance sensor revenues increase approximately 37% in the fourth quarter of 2018 versus fourth quarter of 2017. And the revenue increase was approximately 59% for the 12 months ended December 31, 2018, as compared to the prior year period. We are pleased with the continued acceptance of this new sensor platform and are proud to provide enhanced performance to customers. We are also pleased to be manufacturing on an efficient platform.

A second example of our innovation is our value-added OEM transducer business, part of our Force Sensors segment. For the year ended December 31, 2018, its revenues increased by 73% compared to the prior year period. The revenue for the OEM transducer business was slightly down in the fourth quarter for 2018 compared to the fourth quarter of 2017.

A final example is in our Weighing and Control Systems segment. Our TruckWeigh and VanWeigh on-board weighing business revenues increased by 65% in the fourth quarter of 2018 as compared to the fourth quarter of 2017. For the year ended December 31, 2018, the revenues increase was approximately 78% as compared to the comparable prior year period. We see trends continuing in some important end markets for our business. In particular, I'll note aerospace and defense, steel and semiconductor equipment for testing and measurement.

Turning to our end markets. Aerospace continues to see positive demand growth, driven by increasing production rates. In the defense end market, noise related to ongoing budget discussions, midterm elections, the partial government shutdown and reblock in Washington creates uncertain environment. However, order rates and backlog remains positive with expectations for low single-digit budget increase to 2020.

In the semiconductor end market, following a very robust capital expenditure cycle, spending has moderated at the end of 2018, which is expected to continue in 2019. Overall, the prevailing focus for the shorter and softer cycle for the semi-capital expenditure with improvements in spending in the second half of 2019.

Finally, turning to the steel market. In 2018, global steel demand continued to show resilience supported by the recovery in investment activities in developed economies and the improved performance of emerging economies. Demand for steel is expected to remain positive into 2019, growing at 1.4%. Globally, by region steel demand in developed countries is expected to be healthy, but growth will moderate.

In developing nations, particularly China, demand growth is expected to decelerate in the absence of government stimulus on easing of global trade tensions. On balance, we expect growth to remain positive in 2019, but at a more moderate rate than we saw in 2018, given discrete industry, uncertainty and isolated areas of moderation throughout the end markets we serve.

On Slide 6, the company's overall book-to-bill was 0.93 for the fourth quarter of 2018 compared to 1.18 in the fourth quarter of 2017 and 0.98 in the third quarter of 2018. We believe this reflect sustained business environment in our market as well as our focus on execution. Total orders for the fourth quarter of 2018 was $71.7 million, a decrease of $10.1 million or 12.3% from $81.8 million in the fourth quarter of 2017 and a decrease of $2.3 million or 3.0% from $74.0 million in the third quarter of 2018.

The sequential decrease in order is primarily attributable to precision resistors for the test and measurement market in the Americas and Asia and also for steel products in Asia. Our backlog at December 31, 2018, decreased to $93.4 million compared to $99.4 million at September 29, 2018, but increased compared to $88.9 million at December 31, 2017.

On Slide 7, some details on our reporting segment. The Foil Technology Products segment had a book-to-bill ratio of 0.88 for the fourth quarter of 2018 compared to 1.36 for the fourth quarter of 2017 and 0.95 for the third quarter of 2018. Sequentially, orders decreased by $1.8 million or 5.4% from the third quarter of 2018, primarily in the Americas, with the decrease coming from precision resistors product line in the test and measurement end market.

The Foil Technology Products segment gross profit margin was 42.0% for the fourth quarter of 2018, up from 39.3% in the fourth quarter of 2017 and down from 43.9% in the third quarter of 2018. The year-over-year gross profit increase of $3.7 million was primarily due to the increase in volume of $4.5 million across all regions.

Our growth in Asia was primarily within the test and measurement market for precision resistors in addition to the force measurement market for advance sensors products. Our growth in Europe was primarily within the test and measurement market for precision resistors. In the Americas, growth was primarily coming from the Pacific Instruments products within the avionic, military and space end market.

Partially offsetting the volume increase was an increase in wages of $0.7 million. Sequentially, gross profit margin decreased by $400,000, primarily due to $500,000 for supplies and tooling and repairs and maintenance and manufacturing inefficiencies of $300,000, partially offset by an increase of volume of $600,000. The Foil Technology Products segment backlog was 4.0 months compared to 4.7 months last year and 4.4 months in the prior quarter.

Looking at the Force Sensors segment, the book-to-bill ratio was 1.05 for the fourth quarter of 2018 compared to 1.18 in the fourth quarter of 2017 and 0.98 for third quarter of 2018. Sequentially, order increased by $600,000 or 3.2% in Europe within the precision weighing and medical end markets. The gross profit margin for the segment was 26.6% in the fourth quarter of 2018, down from 29.5% in the fourth quarter of 2017 and up from 25.9% in the third quarter of 2018.

The gross profit decrease of $700,000 compared to the fourth quarter of 2017 was due to an increase in wages of $300,000, a reduction in inventory of $300,000 and $200,000 related to the U.S. imposition of tariffs on the goods from China. The gross profit was flat compared to the third quarter of 2018, despite the reduction in volume of $200,000, offset by improved manufacturing efficiencies of $200,000. The Force Sensors segment backlog was 3.1 month compared to 3.7 month in the fourth quarter of 2017 and 2.9 month in the third quarter of 2018.

For Weighing and Control Systems segment, the book-to-bill ratio was 0.92 for the fourth quarter of 2018 compared to 0.92 in the fourth quarter of 2017 and 1.02 for the third quarter of 2018. Sequentially, order decreased by $1.0 million or 4.4%. The decrease in order is primarily attributable to the steel products in Asia and Europe, partially offset by an increase in on-board weighing products in the Americas. The gross profit margin for the segment was 46.8% in the fourth quarter of 2018 versus 44.8% in the fourth quarter of 2017 and 46.6% in the third quarter of 2018.

Weighing and Control Systems gross profit increased by $1.1 million from the fourth quarter of 2017 due to an increase in volume of $1.3 million, mainly for steel products in Asia and process weighing product in the Americas and Europe. The sequential gross profit increase of $600,000 compared to the third quarter of 2018 was primarily due to an increase in volume of $700,000, mainly from the steel product line in Asia and process weighing in Europe. The Weighing and Control System backlog was at 3.5 month compared to 2.8 month in the fourth quarter of 2017 and 4.0 month in the third quarter of 2018.

On Slide 8, in light of the continued stable business environment at a constant fourth fiscal quarter 2018 exchange rate, we expect net revenues in the range of $72 million to $78 million for the first fiscal quarter of 2019.

With that, let's open the lines for questions. Thank you.

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Questions and Answers

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Operator [1]

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(Operator Instructions) And our first question will come from John Franzreb of Sidoti & Company.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [2]

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Listen, I guess, I want to start with the book-to-bill ratio. What should we infer from that it's been kind of flat for the last 2 quarters after nearly 2 years of growing book-to-bill? Is it a function of FX? Is it a function of change in geography? You've kind of pointed out Asia was weak. How should we think about analysis, shorter duration orders that are coming through the P&L. Can you just walk us through what we should think about the bookings number at this point?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [3]

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Sure. The book-to-bill for this company, which the product line is -- as you know, our business is very diversified. And even of record high majority of products and given end markets, we still have a book-to-bill over 1. So the way to look at that is looking at the dynamics of the end market. I think that if I will start with the Foil Technology Products, which we have seen a book-to-bill of 0.8, it really reflects softing of the semiconductor testing equipment, which implies softer demand regarding memory supply, Big Data, smartphones, all of those -- the softening of that end market is mainly reflected on the precision resistors. In regards to the industrial end markets, we see a stable environment in the Americas. And in Europe, we don't sell much into the industrial market in Asia. So there's slowdown in Asia, which is mainly driven by the Chinese recession, is less affecting our demand in regards to the industrial sector. In the Force, in the FTP, well, we have seen a positive book-to-bill this quarter of 1.05. We see, I would say, a stable demand regarding precision weighing, while we should expect some softening on the precision agriculture equipment due to a depletion of inventory, but we do have new projects and new products with OEMs that are expected to offset the softening of the demand. So we fairly see a stable environment. Last but not least regarding Weighing and Control Systems, I think that one of the phenomenas is the steel demand, which, based on macro information, is expected to grow year-over-year in a more moderate manner, less in China, more in the developed countries. In regards to process weighing and on-board weighing, I would say process weighing, we should expect to see a stable environment in Europe and in the United States. And in the on-board weighing, we believe that the environment is still solid moving into 2019, despite some uncertainty regarding the Brexit situation, whereby, we have, I would say -- our British subsidiary is providing product to the domestic market. But all in all, beside the China slowdown and the semiconductor, for the complete company as we have a very diversified product line, which are reaching out to different end markets, we do expect to see stable business environment.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [4]

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Exposure that you have to the semiconductor market, how much is it as a percent of sales overall or percent of FTP?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [5]

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We don't provide the breakdown of the semi. It's part of the test and measurement end markets, which, I think, that for the FTP it could be around, 20% -- I would say around 20% of the FTP, roundabout. But which encompass more application than just semiconductor.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [6]

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Okay. Fair enough. Also second with FTP while we're at it, the gross margin was down sequentially, some tooling and some manufacturing efficiencies. Are those issues behind you now?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [7]

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Yes, this is correct. We had some inefficiency in Q4 and higher supply and tooling and repairs and maintenance due to the higher volume that those product lines were running. And during the year end, it was kind of a catch-up mode. But definitely, the effect should be behind us as we move forward into Q1.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [8]

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Got it. And I guess, lastly, just on Pacific Instruments, the write-down there. What went wrong? Why was it need -- why did you need to take that write-down?

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [9]

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John, it's really -- it's an accounting exercise. And what you do, you go through and you look at your forecast versus your actual. And what we saw during 2018 was an unfavorable product mix, something that we don't forecast. But that could be positive in the future, but we just don't forecast any product mix. And due to the unfavorable mix that we had through this accounting exercise we took this noncash charge. But the business itself is strong and very good.

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Operator [10]

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(Operator Instructions) And our next question will come from Sarkis Sherbetchyan of B. Riley FBR.

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [11]

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So I want to touch on the new lease agreement. Know you filed the 8-K last night, and you touched upon it a little bit in this conference call. It seems like you're expanding the capacity for advance sensors. Maybe can you help us understand the amount of capacity you're planning to bring for advance sensors?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [12]

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In the last few years, we have been reporting a dramatic increase year-over-year for advance sensor volume, which was -- which I would say was a high double digit. We -- as you know, the advance sensor line is used once to generate new applications and new revenues, which the company never had based on the technology and the new design in conjunction with streaming line -- with streamline of legacy business, which would enable us to provide better products at a lower cost to our customers. As we have been -- so, initially, we have been doing that in the first few years, and the momentum has been picking up very, very nicely. We are at a point now where our existing location is too small in order to support future expansion. Therefore, we went to the new lease agreement in order to allow advance sensor to expand its capacity, which I would say would be or is expected to be the potential capacity based on the new location, is expected to support at least, I would say, 7 to 8x of the revenues. And from a capacity standpoint, it should support at least 5, 6x more capacity, which would enable the company to drive revenues and margin much more substantially and capitalize on this new technology.

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [13]

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That's super helpful, Ziv. And I think you mentioned in the prepared comments the advance sensors were up 37% in 4Q year-over-year and 59% for fiscal '18. I'm not sure if you have the annual maybe revenue in hand that you can kind of share with us. Just trying to gauge how large the advance sensors business could be for your top line.

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [14]

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I would say that we have never provided numbers, but this is already in the double-digit millions of dollars. And I would say that with the new lease in place, once we move in, the potential or I would say the capacity potential would be able to support, I would say, close or north of $100 million business.

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [15]

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Okay. So close to or north of $100 million. And can you just help us understand maybe the cost of production or just what does the margin profile look like for advance sensors relative to, call it, the corporate average that we see today?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [16]

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The advance sensor line from a contribution margin is, I would say, at least north of 5% of the average -- of the company's average.

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [17]

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And can you refresh us where you stand today on the incremental for the company average? I think before it was 50% pretax. Is that the right way to think about it?

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [18]

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Sarkis, are you talking about the -- our contribution margin in total or...?

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [19]

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Yes so, call it, contribution margin corporate average...

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [20]

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Yes. I think what we're seeing year-over-year, given all the -- somewhat increase in -- what we had in G&A, it's probably more like in the, I'd say, 40% to 45% at the moment down to the pretax.

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [21]

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Got it. And then if you add advance sensors and scale it up, it would be meaningfully above the 40% to 45% that you just stated?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [22]

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This is correct, yes.

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [23]

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Yes, yes.

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Sarkis Sherbetchyan, B. Riley FBR, Inc., Research Division - Associate Analyst [24]

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Okay. And just to kind of reiterate. So you could support at least 7 to 8x of the current revenue level, call it, a business that's about $100 million in top line. Can you maybe help us understand the pathway to that growth trajectory?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [25]

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Okay. In the advance sensors, we have 2 platforms. One is what we are defining as a -- this is more for the large OEM type of business, which we have been designing products at different OEMs, and ones -- and some of the OEMs are running on a high volume projection, while other OEMs are running on a lower volume projection. So during -- let's take the current snapshot. The current snapshot is that more than 50%, I would say -- more than 50% of the revenue -- revenues are generated from new designs. We have a fairly, I would say, good queue of new designs with different OEMs, and the expectation is that the momentum will continue. This is one path. The second path is that this platform in 2019 will develop new product line, which will go into the end user application, mostly for testing of structures. We have not been doing that so far. The average selling prices are way, way higher, while the volume is slightly lower. So we are going to -- once those products will be -- well, those has been developed and already samples has been provided to different beta sites. We do expect to see also a nice -- I would say a nice upturn regarding those end user business for testing of structures. And just give you an example, one of the potential end market could be PC board testing, which is considered as a fairly sizable market, which we are planning to offer products to.

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Operator [26]

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And next, we have a follow-up question from John Franzreb of Sidoti & Company.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [27]

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Sure. I guess, this kind of dovetails into the previous question. CapEx was up a lot last year. It sounds like you're going to be tooling the new facility in 2020. Given how much bigger it is, can you kind of walk us through what the CapEx budget down is going to be in 2019, but how much it's going to pass to go up maybe incrementally in 2020 to tool up the new facility?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [28]

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Well, in fact, the larger CapEx spending is expected to be in 2019 because we are planning already to spend money into the new facility, despite the fact that we are going only to move in at the mid of 2020. The expected capital spending for next year is roundabout as twice as much. For this year, while the incremental spending would be dedicated for 2 large projects, one is the Modi'in lease for advance sensors and the other one would be an expansion of our capacity in India to support further growth for Force Sensors.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [29]

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So you're talking about CapEx in the $25 million to $30 million range. Is that the right number?

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Ziv Shoshani, Vishay Precision Group, Inc. - CEO, President & Director [30]

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This is correct. It will -- it's close to $30 million. This is correct. 50% is related to those 2 projects, the Modi'in and India expansion.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [31]

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Got it. And okay. That's fine for now. It's a lot more than I was expecting. Okay. And just a couple other kind of housekeeping type questions. I think you said there was $800,000 in professional service fees year-over-year in the quarter. What were they for and we should expect them continue on going forward?

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [32]

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Yes, John, most of them were related to fees associated with internal control costs, some consulting costs. And the majority of that has been expensed already this year. So we should see a reduction going into 2019.

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John Edward Franzreb, Sidoti & Company, LLC - Senior Equity Analyst [33]

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Got it. And what should we be thinking about as far as a tax rate going forward? It's kind of been fluctuating over the past year. What are we thinking there, Bill?

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [34]

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Yes, Well, it's always tough, John. It's always based upon where the profitability is being generated. But I think, on an operational basis, I think, anywhere between take 28% to 30% would be a good use for a tax rate.

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Operator [35]

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And this concludes our question-and-answer session. I would like to turn the conference back over to Mr. Clancy for any closing remarks.

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William M. Clancy, Vishay Precision Group, Inc. - Executive VP & CFO [36]

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I appreciate it. Thank you, everyone, for joining on the call today and for the good questions. We will also be presenting at the Sidoti Conference in late March. So hope to see people there. I do appreciate everybody dialing in today. Thank you very much.

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Operator [37]

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The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.