Q1 2025 Vishay Precision Group Inc Earnings Call

May 6, 2025

Yeah.

Ezra: Music Hello, everyone, and welcome to the BPG's 2025 First Quarter Earnings Conference Call. My name is Ezra and I will be your coordinator today. If you would like to ask a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by two.

Thank you so much.

[inaudible]

Ezra: Hello everyone and welcome to the VP G's 2025 first quarter earnings conference school. My name is Ezra and I will be your coordinator today. If you would like to ask a question, please press star, put it by one on your telephone keypad. If you change your mind, please press star, put it by two. I will now hand you over to your host, Steve Cantor, Senior Director of Investor Relations to begin. Steve, please go ahead.

Steve Cantor: I will now hand you over to your host, Steve Cantor, Senior Director of Investor Relations, to begin. Steve, please go ahead. Thank you, Ezra. Good morning, everyone. Welcome to VPG's 2025 First Quarter Earnings Conference Call. Our Q1 press release and slides have been posted on our website, vpgcensors.com. An audio recording of today's call will be available on the internet for a limited time and can also be accessed on the VPG website.

Ezra: And audio recording of today's call will be available on the Internet for a limited time and can also be accessed on the VPG website.

Steve Cantor: Today's remarks are governed by the safe harbor provisions of the 1995 Private Security Litigation Reform Act. Our actual results may vary from forward-looking statements.

Speaker Change: Today's remarks are governed by the safe harbor provisions of the 1995 private security litigation reform act. Our actual results may vary from forward-looking statements.

Steve Cantor: For a discussion of the risks associated with BPG's operations, we encourage you to refer to our SEC filings, especially the Form 10-K for the year ended December 31, 2024, and our other recent SEC filings.

Speaker Change: For a discussion of the risks associated with BPPG's operations, we encourage you to refer to our FCC filing, especially the form 10K for the year ended December 31, 2024 and our other recent SEC filings.

Steve Cantor: On the call today are Ziv Shoshani, CEO and President, and Bill Clancy, CFO.

Speaker Change: On the call today are Ziv Shoshani, CEO and President, and Bill Clancy CFO . I'll now turn the call to Z for some prepared remarks. Please refer to slide three of the quarterly presentation.

Steve Cantor: I'll now turn the call to Ziv for some prepared remarks. Please refer to Slide 3 of the quarterly presentation. Ziv?

Ziv Shoshani: Thank you, Steve. I will begin with some commentary on our results and trends for the first quarter.

Ziv Shoshani: Thank you, Steve. I will begin with some commentary on our results and print for the first quarter. Bill will provide financial details about the quarter and our outlook for the second quarter of 2025.

Ziv Shoshani: Bill will provide financial details about the quarter and our outlook for the second quarter of 2025. Moving to slide 3. Beginning with revenue, first quarter revenue of 71.7 million declined modestly from the fourth quarter and was impacted by approximately 2 million of delayed shipments of our calc products. Our consolidated orders grew 2.7% sequentially and resulted in a book-to-bill of 1.04. This marked our second quarter of sequential order growth, with bookings increased in both the sensors and measurement system segments. Despite muted revenue level, we generated a solid cash flow in the quarter. Cash from operation was $5.3 million and adjusted free cash flow was $3.7 million.

Ziv Shoshani: Moving to slide three, beginning with revenue, first quarter revenue of 71.7 million decline modestly from the fourth quarter, and was impacted by approximately 2 million of the late shipments of our kelk products.

Ziv Shoshani: Our consolidated orders grew 2.7% sequentially and resulted in a book to be of 1.04.

Ziv Shoshani: This marked our second quarter of sequential order growth with bookings increased in both the sensuals and measurement system segments.

Ziv Shoshani: Despite muted revenue level, we generated a solid cash flow in the quarter. Cash form operation was 5.3 million and adjusted free cash flow was 3.7 million.

Ziv Shoshani: Before discussing our performance by segment, I want to comment on tariff development as they relate to VTG. Given our manufacturing footprint and supply chains, we believe VPG is positioned to navigate the changing tariff. Based on current tariffs and expected volume, we anticipate the impact to our input costs to be minor based on our supply chain. With regard to the U.S. 10% tariffs, we expect to pass the majority of the tariffs impact on to our customers.

Ziv Shoshani: Before discussing our performance by segment, I want to comment on tariff development as

Ziv Shoshani: Given our manufacturing footprint and supply chains, we believe VPG is positioned to navigate the changing tariffs

Ziv Shoshani: Based on current tariffs and expected volume, we anticipate the impact to our input costs to be minor based on our supply chains.

Ziv Shoshani: With regard to the U.S. Census and tariffs, we expect to pass the majority of the tariffs on 12 customers.

Ziv Shoshani: I'll now review our business segment performance. Moving to slide four. Beginning with our sensor segment, first quarter revenue increased 5.1% sequentially, driven primarily higher sales of stringages and precision resistors in the test and measurement market. Sensors booking rose 6.7% sequentially, reaching the highest level in five quarters and resulting in a book-to-bill of 1.06. This growth reflected higher demand in the test and measurement applications, particularly from semiconductor equipment makers. In addition, our initiatives in humanoid robot applications continue to progress well. We received an additional order of more than $1 million from our initial humanoid robotics customers as they continue to ramp up the development of their robots.

Ziv Shoshani: I now review our business segment performance, Moving to Slide 4

Ziv Shoshani: Beginning with our sense of segment, first quarter revenue increased 5.1% sequentially, driven primarily higher sales of stringages and precision resistors in the test and measurement

Ziv Shoshani: Sensors booking rolls 6.7% sequentially, reaching the highest level in 5 quarters and resulting in the book to Bill of 1.06.

Ziv Shoshani: This growth reflected higher demand in the test and measurement applications, particularly from semi-conductor equipment makers.

Ziv Shoshani: In addition, our initiatives in humanoid robot applications continue to progress well. We receive the additional order of more than 1 million from our initial humanoid robotics

the development of their robots.

Ziv Shoshani: We also received an initial prototype order from the second potential robotic customer. Order for consumer applications in our other markets grew sequentially, although demand related to avionic military and space for sensors was soft due to the timing of defense and space projects in the U.S. and Europe. Moving to slide five. Turning to our weighing solution segment, first quarter sales increased 2.7% from the fourth quarter. The increase was driven primarily by higher revenue in the transportation market for specialized load cells for heavy-use trucks. Following strong bookings in Q4, weighing solutions order declined 9.3% sequentially to 26.2 million, resulting in a book-to-bill of 0.99.

Ziv Shoshani: We also received an initial prototype order from the second potential robotic customer.

Ziv Shoshani: Ordered for consumer applications in our other markets grew sequentially, although demand related to avionic military and space for sensors was soft due to the timing of defense and space projects in the U.S. and Europe .

Ziv Shoshani: Moving to slide 5, turning to our weighing solution segment, first quarter says it is 2.7% from the fourth quarter.

Ziv Shoshani: The increase was driven primarily by higher revenue in the transportation market for specialized locals for heavy-use trucks.

Ziv Shoshani: Following strong bookings in Q4, weighing solutions order declined 9.3% sequentially to 26.2 million, resulting in a book to bill of 0.99.

Ziv Shoshani: Higher orders in the transportation market for trucks applications were offset by weaker orders for four sensors OEM business segments related to precision agriculture, construction, and medical applications.

Ziv Shoshani: Moving to slide six. Turning to our measurement system segment, revenue in the first quarter of $18.2 million declined 13.8% sequentially. The decline reflected continued slow trends in the global steel market in part due to softness in the automotive sector, as well as a $2 million shipment delays of Kelk products. We expect to ship these products in the second half of this year. In contrast, first quarter measurement system orders of $19.5 million increased 17.3% sequentially and resulted in a book to bill of $1.07. Bookings reflected higher demand, primarily in the transportation for auto safety testing. Of note, we received an order from the University of Alabama for a prototype of DSI's UHTC system to test non-conductive materials such as ceramics.

Moving to Slide 6

Ziv Shoshani: Turning to our measurement system segment, revenue in the first quarter of 18.2 million declined 13.8% sequentially.

Ziv Shoshani: The decline reflected continued slow trends in the global steel market, in part due to softness in the automotive sector, as well as a $2 million shipments, delays of

Ziv Shoshani: We expect to ship these products in the second half of this year. In contrast, first-quarter measurement system orders of 19.5 million increased 17.3% sequentially and resulted in a book to Bill of 1.07.

Ziv Shoshani: Bookings reflected higher demand primarily in the transportation for auto safety testing.

Ziv Shoshani: Of note, we received an order from the University of Alabama for a prototype of DSI's UHDC system to test non-conductive materials such as ceramics.

Ziv Shoshani: This system will be used as part of a beta test at the University of Alabama we announced in February.

Ziv Shoshani: This system will be used as part of a better test at the University of Alabama, we announced in February .

Ziv Shoshani: Moving to slide 7. As I indicated, the positive order patterns for VPG in the fourth quarter of 2024 continue into the first quarter of 2025. While the short-term global economic outlook for 2025 has become more uncertain, we continue to be focused on driving the long-term potential for VPG, and we are optimistic about the potential.

Ziv Shoshani: Moving to Slide 7, as I indicated the positive order patterns for VPG in the fourth quarter of 2024, continue into the first quarter of 2025.

Ziv Shoshani: While the short-term global economic outlook for 2025 has become more uncertain, we continue to be focused on driving the long-term potential for VPG and we are optimistic about the potential.

Ziv Shoshani: In February, I outlined three top strategic priorities for 2024. First, driving business development with new customers and applications. Second, continuing to reduce costs and increase operational efficiencies. And third, pursuing high quality acquisitions to build scale and expand our cash. We are encouraged by the progress of our business development initiatives in the first quarter, as orders of approximately $8 million were broad-based and were on plan. To drive further growth, we plan to refine our internal processes and capabilities related to sales systems, marketing expertise, and digital marketing. In parallel, we have initiated steps to optimize our sales teams and processes.

In February , I outlined three top strategic priorities for 2025.

First, driving business development with new customers and applications.

Ziv Shoshani: Second, continuing to reduce costs and increase operational efficiencies, and third, pursuing high-quality acquisitions to build scale and expand our cash flow.

Ziv Shoshani: We are encouraged by the progress of our business development initiatives in the first quarter, as orders of approximately 8 million were broad-based and were unplanned.

Ziv Shoshani: To drive further growth, we plan to refine our internal processes and capabilities related to sales systems, marketing expertise and digital marketing.

Ziv Shoshani: In parallel, we have initiated steps to optimize our sales teams and processes.

Ziv Shoshani: On the cost side, we continue to focus on long-term strategic plans which include product relocations and efficiency improvements to reduce our cost. We are on track to achieve our targeted annual operational cost reductions of $5 million by year-end. Finally, regarding M&A, our strong balance sheet provides us with the means to acquire businesses with recognized brands and growth paths.

Ziv Shoshani: On the course side, we continue to focus on long-term strategic plans which include product relocations and efficiency improvements to reduce our cost.

Ziv Shoshani: We are on track to achieve our targeted annual operational cost reductions of 5 million by year end.

Ziv Shoshani: Finally, regarding M&A, our strong balance sheet provides us with the means to acquire businesses with recognized brands and growth paths.

Ziv Shoshani: We remain disciplined and patient in our search for the right opportunity.

Bill Clancy: I will now turn it over to Bill Clancy. Bill?

I will now turn it over to Bill Clancy. Bill?

Bill Clancy: Thank you, Zee. Referring to slide 8 and the reconciliation tables of the slide deck, our first quarter 2025 revenues were $71.7 million. The adjusted gross margin of 38.3% in the first quarter was the same with 38.3% in the fourth quarter.

Bill Clancy: Thank you, Dean. Referring to slide 8 and the reconciliation tables of this slide deck, our first quarter 2025 revenue was 71.7 million.

Bill Clancy: Adjust the gross margin of 38.3% in the first quarter was the same with 38.3% in the fourth quarter

Bill Clancy: Sequentially by segment, adjusted gross margin for sensors of 30.8% decreased due to higher fixed cost and unfavorable foreign exchange rates, which was partially offset by higher volume. claimed to lose an adjusted gross margin of 37.8%. which was adjusted for $278,000 of manufacturing start-up costs increased from the fourth quarter primarily due to higher revenue and the effect of our cost reduction program.

Bill Clancy: sequentially by segment, but just a gross margin for sensors of 30.8% decreased due to higher fixed cause and unfavorable foreign exchange rates, which was partially upset by higher volume.

Wayne Solutions adjusted gross margin of 37.8%

Bill Clancy: which was adjusted for 278,000 manufacturing startup costs, increased from the fourth quarter, primarily due to higher revenue and the effect of our cost reduction program.

Bill Clancy: Gross margin for measurement systems of 50.3% declined from the fourth quarter due to lower revenue. Moving the slide now.

Bill Clancy: Gross margin for measurement systems of 50.3%, decline from the fourth quarter due to lower revenue.

Moving to slide nine.

Bill Clancy: Our adjusted operating margin of 1.1 percent, which excluded startup and restructuring costs amounting to $858,000, improved from 0.8 percent in the fourth quarter of 2024. Selling General Administrative Expenses The first quarter was $26.7 million, or 37.2% of revenue. declined from $27.3 million, or 37.5% of revenues, for the fourth quarter of 2024. The decrease in SG&A is mainly due to lower commissions and travel.

Bill Clancy: Our adjusted operating margin at 1.1%, which excluded start-up and restructuring costs, amounting to $858,000, and improved from 0.8% in the fourth quarter of 2024.

Bill Clancy: Selling General Administrative Expense for the first quarter was 26.7 million or 37.2% of revenues.

Bill Clancy: Declined from 27.3 million or 37.5% of revenues for the fourth quarter of 2024, the decrease in SGNA is mainly due to lower commissions and droughts.

Bill Clancy: The gap tax rate for the first quarter was not a meaningful number given the geographic mix and level of income. We are assuming an operational tax rate of approximately 27% for the full year of 2025.

Bill Clancy: The gap tax rate for the first quarter was not a meaningful number given the geographic mix and level of income.

Bill Clancy: We are assuming an operational tax rate of approximately 27% for the full year of 2025.

Bill Clancy: We've reported a net loss of $942,000 or $0.07 per diluted share. Adjusting for the manufacturing startup costs, restructuring, foreign currency exchange losses, adjusted net earnings for the first quarter was $468,000 or $0.04 per diluted share compared to $400,000 or $0.03 per diluted share in the fourth quarter of 2024. Moving to slide 10. Adjusted EBITDA was $5.1 million or 7.2% of revenue compared to $5.1 million or 7% of revenue in the fourth quarter.

Bill Clancy: We've reported a net loss of $942,000 or 7 cents per diluted share.

Adjusting for the manufacturer's starter cost

restructuring

Bill Clancy: Foreign currency exchange law that adjusted net earnings for the first quarter was $468,000 or $4,000 in per diluted share, compared to $400,000 or $3 in per diluted share in the fourth quarter of 2024.

Moving to slide 10

Bill Clancy: Adjected divida of 5.1 million or 7.2% of revenue compared to 5.1 million or 7% of revenue in the fourth quarter.

Bill Clancy: CapEx in the first quarter was 1.5 million dollars. By the end of 2025, we are forecasting $10-12 million for capital expenditures. He generated a just-to-free cash flow of $3.7 million in the first quarter, which compared to $4.6 million in the fourth quarter. increased our cash position from the 731st 2024 by $4.6 million to $83.9 million in the first quarter.

Capac in the first quarter was $1.5 million.

Bill Clancy: For 2025, we are forecasting 10 to 12 million for capital expenditures.

Bill Clancy: We generated just a free cash flow of $3.7 million to the first quarter, which compared to $4.6 million in the fourth quarter.

Bill Clancy: We increase our acquisition from the 731st 2024 by $4.6 million to $8.9 million in the first quarter. Total outstanding long-term debt was $31.5 million.

Bill Clancy: Total outstanding long-term debt was $31.5 million. We believe that we have a strong balance sheet and ample liquidity to support our business requirements and to fund M&A. With a second fiscal quarter of 2025 at constant first fiscal quarter of 2025 exchange rates, we expect net revenues to be in the range of $70 million to $76 million.

Bill Clancy: We believe that we have a strong boundary and ample liquidity to support our business requirements and to fund the M&A.

regarding the outlook.

Bill Clancy: For the second physical quarter of 2025, at constant first physical quarter of 2025 exchange rates, we expect net revenues to be the range of $70 million to $76 million.

Bill Clancy: In summary. Bookings of $74.4 million grew sequentially to the second straight quarter, resulting in a book-to-bill ratio of 1.04. Our business development initiatives continue to advance. and we continue to generate solid cash flow in a challenging business environment.

in summary.

Bill Clancy: Bookings of 74.4 million grew sequentially to the second straight quarter, resulting in a book to build ratio of 1.04.

Our Business Development Initiative continues to advance.

Bill Clancy: and we continue to generate solid cash flow in a challenging business environment.

Steve Cantor: With that, let's open the lines for questions. Thank you very much. If you would like to ask a question, please press star, pull it by one on your telephone keypad. Now, please ensure your line is unmuted locally. And if you change your mind, or your question has already been answered, then please press star, pull it by two.

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

Speaker Change: Thank you very much. If you would like to ask a question, please press star, pull it by one on your telephone keypad now. Please ensure your line is unmuted locally. If you change your mind or your question has already been answered, then please press star, pull it by two.

John Franzreb: Our first question comes from John Franzreb with Sudoti. John, your line is now open, please go ahead. Good morning, everyone, and thanks for taking the questions. Ziv, I'd like to get your opinion on the incoming order book. How does May compare to March, and what are your customers saying about inventory trends and what they're thinking on a go-ahead basis?

Speaker Change: Our first question comes from John Franzreb with Sudoti. John your line is now open. Please go ahead

Good morning everyone and thanks for taking the questions.

John Franzreb: Ziv, I'd like to get your opinion on the incoming order book. How does it make, compared to March? What are your customers saying about inventory trends and what they're thinking to go ahead basis?

Ziv Shoshani: Good morning, John. In regards to the older intake, I would say that we do see a modest recovery. already in Q1 mainly in test and measurement from semiconductor customers and also related to our humanoid robots and to an extent on the transportation market. We do expect the demand to continue. Initially, we don't see, I would say, a significant upside from real demand, which is coming from new orders, given our customers' new demand in respect to the market recovery. Much of the demand today is coming from replenishing of the supply chain, while generating new demand from our business development initiatives.

Good morning, John .

John Franzreb: In regards to the order intake, I would say that we do see a modest recovery.

John Franzreb: already in Q1 mainly in test and measurement from semi-conductor customers and also related to our humanoid robots and to an extent on the transportation markets.

Those, we do expect...

The Dement to continue.

Initially, we don't see.

I would say significant upside

John Franzreb: from Real Demand, which is coming from New Order, given our customers new demand.

John Franzreb: In respect to the market recovery, much of the demand today is coming from replenishing of the current supply chain while generating new demand from our business development initiatives.

Thank you.

Ziv Shoshani: So prepare to assume that. that the revenue profile has somewhat dropped and we're at a gradual upslope. to leave you there. John, I'm sorry. Yeah, John, your assumption is absolutely correct that I believe we have hit this problem. And there is a continuation of what Ziv talked about, a modest recovery going forward. Got it.

so that they are resuming.

John Franzreb: that the revenue profile is somewhat trough and we're at a gradual upslope.

John Franz, John Franz, Steven Cantor, Ziv Shoshani, Vishay Precision Group

Ziv Shoshani, Ziv Shoshani, Steven Cantor

I'll leave you there.

John Franzreb: John , John , you're something that's absolutely correct that I think believe we have had this problem and there is a continuation of what Ziv talked about, a modest recovery going forward.

Ziv Shoshani: And just a question on the delay in the calc order into the second half, that's a pretty sizable delay. Can you give any color to that? And is there any cancellation risk in that $2 million order?

Speaker Change: Product. And just a question on the delay in the kelp order into the second half. That's a pre-sizable delay. Can you give any color to that and is there any cancellation risk in that $2 million order?

Ziv Shoshani: Yes, absolutely. As you said, this is a significant amount, but given the fact that... Kerk is selling high-ticket items at around $400,000 to $500,000 per order.

Ziv Shoshani, Ziv Shoshani, Steven Cantor

Speaker Change: Yes, absolutely. As you said, this is a significant amount, but given the fact that

Kirk is selling high-ticket items at around 4 to 500

Speaker Change: $1,000 per order, we had some operational issues which we have been resolved given the cycle time.

Ziv Shoshani: We had some operational issues which we have been resolved, given the cycle time, those orders are expected to be shipped in the second half of the year. Regarding your comment regarding cancellation, all in all, since we are supplying across the company a custom product, we have not seen in the past and we do not see any cancellations from customers. Got it.

Speaker Change: Those orders are expected to be shipped in the second half of the year.

Speaker Change: Regarding your comments, regarding cancellation, all in all, since we are supplying across the company, a custom product, we have not seen in the past and we do not see any cancellations from customers.

Ziv Shoshani: I guess one last question, I'll get back into the queue. And the $5 million cost savings, what's the timing of realizing that? And is it all in cost of goods sold or SG&A, or is there a mix that we should kind of be thinking about? The $5 million savings we are looking at year over year, 2025 in respect to 2024, most I would say by far most of the savings are in the cost of goods sold, resulting from material cost reduction, product relocation, and process improvement. Got it.

Speaker Change: Got it. I guess one last question or the back into Q. And the $5 million cost savings. What's the timing of realizing that and is it all in cost of goods old or SG&A or is there a mix that we should be kind of thinking about?

Speaker Change: The $5 million savings we are looking at year over year, 2025 in respect to 2024, most I would say

Speaker Change: By far, most of the savings are in the cost of goods sold, resulting from material cost reduction, product relocation and process improvements.

Ziv Shoshani: Thank you, Ziv. I'll get back in to you.

Speaker Change: Got it, thank you, Ziv, I'll get back into fuel [inaudible]

Ziv Shoshani: Thank you very much.

Speaker Change: Thank you very much. Our next question comes from Griffin Boss with B. Riley Securities. Griffin, your line is no open, please go ahead.

Griffin Boss: Our next question comes from Griffin Boss with B. Reilly Securities. Griffin, your line is now open. Please go ahead. Hi, good morning, and thanks for taking the questions.

Griffin Boss: Hi, good morning and thanks for picking the questions. Just to start out as a follow-up.

Ziv Shoshani: Just to start off as a follow-up to the CalPERS question, is this $2 million delayed shipment, is that incremental to the $5 million that you mentioned on the fourth quarter earnings call? You mentioned the $5 million of shipments were delayed, and you expected $2 million to be recognized in the next quarter. Is that related to that same push?

to the KELP question.

Is this?

$2 million dollar delay shipment. Is that incremental to the...

Griffin Boss: The $5 million that you mentioned on the fourth quarter, earnings call, you mentioned $5 million as we're delayed and you expected $2 million to be recognized in the first quarter, is that related to that same push?

Ziv Shoshani: So, this is a very good question. So, Joe, the $2 million are related to KELC products? which, as I indicated, the deliveries will be pushed up to the second half of the year. The $5 million that I indicated in Q4 was related to DTS and DSI products, given the fact that customers were expecting to get those orders. And those orders have been placed in Q1. But those are different product lines. The 5 million DTS-DSI, while the 2 million is KELP still. Okay, okay, understood. Thanks for that.

Griffin Boss: So, this is a very good question. So, George, the two million dollars are related to

Griffin Boss: which, as indicated, will be pushed up to the second half of the year, the $5 million that I've indicated in Q4 was related to DTS and DSI products.

Griffin Boss: given the fact that customers were, we were expecting to get those orders.

Griffin Boss: and those orders have been placed in Q1, but those are different order lines. The 5 million DTSDSI,

Ziv Shoshani: And then I wanted to touch on the humanoid robots opportunity. Obviously, it looks like you guys are continuing to make good progress there. Is there any more color you can give now that you're starting to see, you know, more order flow from those two initial customers on, you know, how many sensors we should expect are being used in, you know, a single robot? And to the extent maybe you could discuss certain ASPs for those sensors as well.

Speaker Change: Okay. Okay. Understood. Thanks for that. And then I wanted to touch on the humanoid robots opportunity. Obviously looks like you guys are continuing to make good progress there. Is there any more color you can give now that you're starting to see, you know, more order flow from those two initial customers on, you know, how many sensors. Okay. Okay. Okay. [inaudible]

Speaker Change: We should expect are being used in, you know, single robot and to the extent maybe you could address certain ASPs for those sensors as well.

Ziv Shoshani: I am not sure how much color I can provide, but I could say that we are working with our customers in the second development phase. There was a very large order, over a million dollars, that has been placed in Q1. We are working on a larger order for the future. for, I would say, the second half of the year. We are looking at the... complete, or I would say our value would be between $500 to $1,200 per robot. This is what I can provide at this point, and we are speaking about tens of sensors. within each box.

Speaker Change: I'm not sure how much color I can provide, but I could say that we are working with our customers in the second development phase.

Speaker Change: There was a very large order over a million dollars that has been placed in Q1. We are working on a larger order for the...

Speaker Change: for I would say the second half of the year we are looking at

Complete, or I would say, our value...

Speaker Change: would be between $500 to $1200 per robot. This is what I can provide at this point and we are speaking about tenths of sensors.

within each boat.

Ziv Shoshani: But unfortunately, I don't think I would be able to share more information at this point in time.

Speaker Change: But unfortunately, I don't think I would be able to share more information at this point in time.

Griffin Boss: Ziv, that was helpful. Thanks. Thanks for that. And then fully understood.

Speaker Change: No, Ziv, that was helpful. Thanks for that. And then I'm fully interested. And then just a lesson for me, curious about the CAPEX ramp. I know you said in the past, you should think about that as a V-04.

Bill Clancy: And then just last one for me curious about the CapEx ramp. I know you said in the past, we should think about that as maybe, you know, 4%, 4.5% of sales going forward. It was pretty light in the first quarter. So curious, Bill, if you can just touch on kind of how you're looking at the cadence throughout the year. Should we be back to kind of a gradual ramp up or maybe a little bit more CapEx investment in the back half of the year? Since most of the CAPEX are related to sensors equipment, and some of the equipment are semiconductor type of equipment with a longer lead time, we always see a much larger CAPEX in the second half of the year in respect to the first half of the year.

Speaker Change: 4.5% of sales going forward. It was pretty light in the first quarter so curious if you can just touch on kind of how you're looking at the cadence throughout the year. Should be back kind of a gradual ramp up or maybe a little bit more capitalist investment in the back half of the year.

Ziv Shoshani, Ziv Shoshani, Steven Cantor

Bill Clancy: Since most of the capex are related to sensors equipment and some of the equipment are semi-conductual type of equipment with a longer lead time we always see a much larger capex in the second half of the year in respect to the first half of the year.

Bill Clancy: So we still believe that we are going to spend between 10 to 12, but we will see most of the spending coming in the second half of the year.

Griffin Boss: Okay, great.

Griffin Boss: Thanks for taking my questions. Appreciate it.

Okay, great. Thanks for taking my questions. I appreciate it.

Steve Cantor: Thank you very much.

Steve Cantor: If you would like to ask a question, please press star by one on your telephone keypad now. We currently have no further questions.

Bill Clancy: Thank you very much. If you would like to ask a question, please press star, first by one on your telephone keypad now.

Steve Cantor: We currently have no further questions. I will now turn back to Steve for any closing remarks.

Steve Cantor: I will now turn back to Steve for any closing remarks. I think we may have another question. Could you could you recheck? Apologies for that.

[inaudible]

Speaker Change: That's what I think we may have another question. Could you could you recheck?

John Franzreb: We have a question from John with Sudoti. John, your line is now open. Please go ahead. Yeah, thanks for squeezing me back in. I'm actually curious about share repurchases. You were somewhat aggressive in early 2024 at higher thresholds than we're trading today and certainly what you're open at today. It doesn't seem that, you know, I don't know where your cash is domiciled, but it doesn't seem that cash is an issue. What are your thoughts about repurchasing the stock at this level? So, John, at this point in time, our cash is to the effect where just approximately 4% of our cash is in the U.S., or conversely, 96% outside.

[inaudible]

Speaker Change: Apologies for that. We have a question from John with Sudoti. John your line is now open. Please go ahead.

John: Yeah, thanks for squeezing me back in. I'm actually curious about shared repurchases. You were somewhat aggressive in early 2024 at higher thresholds than retreating today and certainly your open app today.

John: It doesn't seem that, you know, I don't know where your cash is domicile, but it doesn't seem that your cash is an issue. What are your thoughts about repurchasing the stock at those levels?

Thank you. Thank you.

John: So John , at this point in time, our cash is to the effect we're just approximately 4% of our cash within the US or...

Conversely, 96% outside.

Ziv Shoshani: And to bring a lot of that cash back into the U.S., we would have to pay significant cash tax on that, on those repatriations.

John: and to bring a lot of that cash back into the U.S. would...

We would have to pay significant cash tax

on that, on those repatriation.

Bill Clancy: So at this point in time, you know, we have not purchased any shares during the first quarter. Okay, thanks. And Mike, I got your bill. Did you just did you say that the tax rate you should be using for the full year is 25%? Twenty-seven percent. 27. Thanks for the clarification. Thank you guys. Thank you very much, John.

John: So at this point in time, we have not purchased any shares during the first quarter.

Speaker Change: Okay, thanks. And Mike, I got you a bill. Did you say that the tax rate you should be using for the four years is 25%?

27%.

27th. Thanks for the clarification. Thank you guys.

You're welcome.

Steve Cantor: That concludes our question and answer session. I will now hand back over to Steve for any closing remarks. Before closing our call, I do want to remind investors and those listening that we will be presenting at the upcoming Be Riley Conference on May 22nd and the Three-Part Advisor Conference in June. We look forward to updating you on BPG next quarter and thank you and have a great day. Thank you very much, Steve, and thank you to Bill and Ziv for being our speakers on today's call.

Speaker Change: Thank you very much, John . That concludes our question and answer session. I will now hand back over to Steve for any closing remarks.

Speaker Change: Before closing our call, I do want to remind investors and listening that we will be presenting at the upcoming B. Riley conference on May 22nd and the three-part advisor conference

Speaker Change: We look forward to updating you on VPG next quarter and thank you and have a great day.

Speaker Change: Thank you very much, Steve, and thank you to Bill and Ziv for being our speakers on today's call. That concludes the conference call for today. We appreciate everyone for joining. You may now disconnect your lines.

Steve Cantor: That concludes the conference call for today. We appreciate everyone for joining. You may now disconnect your lines.

William Clancy, Steven Cantor, Ziv Shoshani

Q1 2025 Vishay Precision Group Inc Earnings Call

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