What changed in this filing

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Item 1. Financial Statements

2023-11-07 compared with 2023-08-08 · 92 added, 78 removed, 516 unchanged (25% of the section changed)

3 unchanged sentences

(In thousands)

July 1, 2023 December 31, 2022

September 30, 2023 December 31, 2022

Current assets:

Cash and cash equivalents $ 94,632 $ 88,562

Short term investment 1,000 —

Accounts receivable, net 57,240 60,068

22 unchanged sentences

(In thousands)

July 1, 2023 December 31, 2022

September 30, 2023 December 31, 2022

Liabilities and equity (Unaudited)

28 unchanged sentences

Fiscal quarter ended

July 1, 2023 July 2, 2022

September 30, 2023 October 1, 2022

Net revenues $ 85,854 $ 90,057

7 unchanged sentences

Other 1,671 1,223

Other income (expense) ( 60 ) 2,916

Other income 552 587

Income before taxes 8,776 12,471

11 unchanged sentences

(Unaudited - In thousands, except per share amounts)

Six fiscal months ended

July 1, 2023 July 2, 2022

Nine fiscal months ended

September 30, 2023 October 1, 2022

Net revenues $ 265,520 $ 266,340

22 unchanged sentences

Fiscal quarter ended

July 1, 2023 July 2, 2022

September 30, 2023 October 1, 2022

Net earnings $ 6,357 $ 10,148

10 unchanged sentences

(Unaudited - In thousands)

Six fiscal months ended

July 1, 2023 July 2, 2022

Nine fiscal months ended

September 30, 2023 October 1, 2022

Net earnings $ 21,690 $ 27,712

Other comprehensive income (loss):

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustment ( 3,831 ) ( 18,214 )

Pension and other postretirement actuarial items, net of tax 2 162

Pension and other postretirement actuarial items 2 227

Other comprehensive loss ( 3,829 ) ( 17,987 )

6 unchanged sentences

(Unaudited - In thousands)

Six fiscal months ended

July 1, 2023 July 2, 2022

Nine fiscal months ended

September 30, 2023 October 1, 2022

Operating activities

20 unchanged sentences

Proceeds from sale of property and equipment 50 397

Purchase of short term investment ( 1,000 ) —

Net cash used in investing activities ( 10,798 ) ( 15,148 )

Financing activities

Payments on revolving facility ( 7,000 ) —

Purchase of treasury stock ( 1,196 ) ( 1,061 )

13 unchanged sentences

Fiscal quarter ended

September 30, 2023

Stock Class B

3 unchanged sentences

Comprehensive

Income (Loss) Total VPG Inc.

Loss Total VPG Inc.

Stockholders'

1 unchanged sentence

Interests Total

Balance at April 1, 2023 $ 1,328 $ 103 $ ( 11,504 ) $ 201,065 $ 163,323 $ ( 39,395 ) $ 314,920 $ ( 27 ) $ 314,893

Balance at July 1, 2023 $ 1,330 $ 103 $ ( 11,924 ) $ 201,611 $ 171,559 $ ( 41,076 ) $ 321,603 $ 62 $ 321,665

Net earnings — — — — 6,280 — 6,280 77 6,357

2 unchanged sentences

— — — 656 — — 656 — 656

Restricted stock issuances ( 17,386 shares)

2 — — ( 2 ) — — — — —

Purchase of treasury stock.

2 unchanged sentences

Distributions to noncontrolling interests — — — — — — — ( 92 ) ( 92 )

Balance at July 1, 2023 $ 1,330 $ 103 $ ( 11,924 ) $ 201,611 $ 171,559 $ ( 41,076 ) $ 321,603 $ 62 $ 321,665

Balance at September 30, 2023 $ 1,330 $ 103 $ ( 12,700 ) $ 202,267 $ 177,839 $ ( 44,729 ) $ 324,110 $ 47 $ 324,157

Fiscal quarter ended

October 1, 2022

Stock Class B

3 unchanged sentences

Comprehensive

Income (Loss) Total VPG Inc.

Loss Total VPG Inc.

Stockholders'

1 unchanged sentence

Interests Total

Balance at April 2, 2022 $ 1,324 $ 103 $ ( 8,765 ) $ 199,223 $ 126,652 $ ( 36,719 ) $ 281,818 $ 25 $ 281,843

Balance at July 2, 2022 $ 1,325 $ 103 $ ( 8,765 ) $ 199,749 $ 137,407 $ ( 44,581 ) $ 285,238 $ 112 $ 285,350

— — — — 10,118 — 10,118 30 10,148

Other comprehensive income — — — — — ( 7,862 ) ( 7,862 ) — ( 7,862 )

Other comprehensive loss — — — — — ( 8,414 ) ( 8,414 ) — ( 8,414 )

Share-based compensation expense

— — — 559 — — 559 — 559

Restricted stock issuances ( 10,531 shares)

Purchase of treasury stock ( 32,601 shares)

— — ( 1,061 ) — — ( 1,061 ) — ( 1,061 )

Distribution to noncontrolling interests — — — — — — — ( 82 ) ( 82 )

Balance at July 2, 2022 $ 1,325 $ 103 $ ( 8,765 ) $ 199,749 $ 137,407 $ ( 44,581 ) $ 285,238 $ 112 $ 285,350

Balance at October 1, 2022 $ 1,325 $ 103 $ ( 9,826 ) $ 200,308 $ 147,525 $ ( 52,995 ) $ 286,440 $ 60 $ 286,500

See accompanying notes.

2 unchanged sentences

(Unaudited - In thousands, except share amounts)

Six Fiscal Months Ended July 1, 2023

Nine Fiscal Months Ended September 30, 2023

Stock Class B

3 unchanged sentences

Comprehensive

Income (Loss) Total VPG, Inc.

Loss Total VPG Inc.

Stockholders'

12 unchanged sentences

Distributions to noncontrolling interests — — — — — — — ( 138 ) ( 138 )

Balance at July 1, 2023 $ 1,330 $ 103 $ ( 11,924 ) $ 201,611 $ 171,559 $ ( 41,076 ) $ 321,603 $ 62 $ 321,665

Six Fiscal Months Ended July 2, 2022

Balance at September 30, 2023 $ 1,330 $ 103 $ ( 12,700 ) $ 202,267 $ 177,839 $ ( 44,729 ) $ 324,110 $ 47 $ 324,157

Nine Fiscal Months Ended October 1, 2022

Stock Class B

3 unchanged sentences

Comprehensive

Income (Loss) Total VPG, Inc.

Loss Total VPG Inc.

Stockholders'

8 unchanged sentences

3 — — ( 426 ) — — ( 423 ) — ( 423 )

Purchase of treasury stock ( 32,601 shares)

— — ( 1,061 ) — — — ( 1,061 ) — ( 1,061 )

Distribution to noncontrolling interests — — — — — — — ( 366 ) ( 366 )

Balance at July 2, 2022 $ 1,325 $ 103 $ ( 8,765 ) $ 199,749 $ 137,407 $ ( 44,581 ) $ 285,238 $ 112 $ 285,350

Balance at October 1, 2022 $ 1,325 $ 103 $ ( 9,826 ) $ 200,308 $ 147,525 $ ( 52,995 ) $ 286,440 $ 60 $ 286,500

See accompanying notes.

10 unchanged sentences

These financial statements should be read in conjunction with the consolidated financial statements and notes thereto as of December 31, 2022 and 2021 and for each of the three years in the period ended December 31, 2022, included in VPG’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 1, 2023.

The results of operations for the fiscal quarter ended July 1, 2023 are not necessarily indicative of the results to be expected for the full year.

The results of operations for the fiscal quarter ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year.

VPG reports interim financial information for 13-week periods beginning on a Sunday and ending on a Saturday, except for the first quarter, which always begins on January 1, and the fourth quarter, which always ends on December 31.

11 unchanged sentences

Fiscal quarter ended

July 1, 2023 Fiscal quarter ended

September 30, 2023 Fiscal quarter ended

October 1, 2022

Sensors Weighing Solutions Measurement Systems Total Sensors Weighing Solutions Measurement Systems Total

6 unchanged sentences

Total $ 32,532 $ 28,970 $ 24,352 $ 85,854 $ 37,879 $ 31,399 $ 20,779 $ 90,057

Six Fiscal Months Ended July 1, 2023 Six Fiscal Months Ended July 2, 2022

Nine Fiscal Months Ended September 30, 2023 Nine Fiscal Months Ended October 1, 2022

Sensors Weighing Solutions Measurement Systems Total Sensors Weighing Solutions Measurement Systems Total

7 unchanged sentences

The following table disaggregates net revenue from contracts with customers by market sector (in thousands) .

Fiscal quarter ended Six fiscal months ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine fiscal months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Test & Measurement $ 17,080 $ 20,659 $ 54,449 $ 60,115

17 unchanged sentences

Balance at December 31, 2022 $ 3,990 $ 7,983

Balance at July 1, 2023 4,170 8,633

Increase $ 180 $ 650

The amount of revenue recognized during the six fiscal months ended July 1, 2023 that was included in the contract liability balance at December 31, 2022 was $ 6.2 million

Balance at September 30, 2023 3,449 8,766

(Decrease) increase $ ( 541 ) $ 783

The amount of revenue recognized during the nine fiscal months ended September 30, 2023 that was included in the contract liability balance at December 31, 2022 was $ 7.3 million.

Note 3 – Goodwill

5 unchanged sentences

Foreign currency translation adjustment 35 39 ( 4 ) — —

Balance at July 1, 2023 $ 45,703 $ 6,464 $ 16,895 $ 16,033 $ 6,311

Balance at September 30, 2023 $ 45,579 $ 6,352 $ 16,883 $ 16,033 $ 6,311

Note 4 – Leases

2 unchanged sentences

Leases recorded on the balance sheet consist of the following (in thousands) :

Leases July 1, 2023 December 31, 2022

Leases September 30, 2023 December 31, 2022

Operating lease right of use asset $ 27,440 $ 24,342

2 unchanged sentences

Other information related to lease term and discount rate is as follows:

September 30, 2023

Operating leases weighted average remaining lease term (in years) 8.11 years

2 unchanged sentences

Note 4 - Leases (continued)

Fiscal quarter ended Six Fiscal Months Ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine Fiscal Months Ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Operating lease cost $ 1,331 $ 1,267 $ 3,822 $ 3,876

2 unchanged sentences

Total net lease cost $ 1,260 $ 1,193 $ 3,644 $ 3,627

Right of use assets obtained in exchange for new operating lease liability during the six fiscal months ended July 1, 2023 were $ 1.5 million.

The Company paid $ 2.5 million and $ 2.6 million for its operating leases for each of the six fiscal months ended July 1, 2023 and July 2, 2022, which are included in operating cash flows on the consolidated condensed statements of cash flows.

Undiscounted maturities of operating lease payments as of July 1, 2023 are summarized as follows (in thousands) :

2023 (excluding the six months ended July 1, 2023) $ 2,370

Right of use assets obtained in exchange for new operating lease liability during the nine fiscal months ended September 30, 2023 were $ 6.4 million.

The Company paid $ 3.8 million and $ 3.9 million for its operating leases for each of the nine fiscal months ended September 30, 2023 and October 1, 2022, which are included in operating cash flows on the consolidated condensed statements of cash flows.

Undiscounted maturities of operating lease payments as of September 30, 2023 are summarized as follows (in thousands) :

2023 (excluding the nine months ended September 30, 2023) $ 1,259

Thereafter 14,926

4 unchanged sentences

VPG calculates the tax provision for interim periods using an estimated annual effective tax rate methodology based on projected full-year pre-tax earnings among the taxing jurisdictions in which we operate with adjustments for discrete items.

The effective tax rate was 28.8 % and 19.2 % for the fiscal quarter ended July 1, 2023, and July 2, 2022, respectively.

The effective tax rate for the fiscal quarter ended July 1, 2023 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.

The effective tax rate for the fiscal quarter ended July 2, 2022 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.

The effective tax rate was 27.6 % and 18.6 % for the fiscal quarter ended September 30, 2023, and October 1, 2022, respectively.

The effective tax rate for the fiscal quarter ended September 30, 2023 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.

The effective tax rate for the fiscal quarter ended October 1, 2022 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.

The Company and its subsidiaries are subject to income taxes imposed by the U.S., various states, and the foreign jurisdictions in which we operate.

8 unchanged sentences

Long-term debt consists of the following (in thousands) :

July 1, 2023 December 31, 2022

September 30, 2023 December 31, 2022

2020 Credit Agreement - Revolving Facility $ 54,000 $ 61,000

8 unchanged sentences

dollar denominated loans as well as update the other applicable reference borrowing rates for foreign currency loans which took effect on June 15, 2023 .

There is no material impact in interest expense or the loan balance as a result of the rate change.

There was no material impact in interest expense or the loan balance as a result of the rate change.

Note 7 – Accumulated Other Comprehensive Income (Loss)

4 unchanged sentences

Balance at January 1, 2023 $ ( 41,489 ) $ 589 $ ( 40,900 )

Other comprehensive income before reclassifications ( 178 ) — ( 178 )

Other comprehensive loss before reclassifications ( 3,831 ) — ( 3,831 )

Amounts reclassified from accumulated other comprehensive income — 2 2

Balance at July 1, 2023 $ ( 41,667 ) $ 591 $ ( 41,076 )

Balance at September 30, 2023 $ ( 45,320 ) $ 591 $ ( 44,729 )

Foreign Currency Translation Adjustment Pension

4 unchanged sentences

Amounts reclassified from accumulated other comprehensive income 191 227 418

Balance at July 2, 2022 $ ( 40,011 ) $ ( 4,570 ) $ ( 44,581 )

Balance at October 1, 2022 $ ( 48,490 ) $ ( 4,505 ) $ ( 52,995 )

Reclassification of foreign currency translation adjustment for the loss on liquidation of subsidiaries is included in other income and expense other (see Note 12).

2 unchanged sentences

Employees of VPG participate in various defined benefit pension and other postretirement benefit ("OPEB") plans.

T he following table sets forth the components of the net periodic benefit cost for the Company's defined benefit pension and OPEB plans (in thousands) :

The following table sets forth the components of the net periodic benefit cost for the Company's defined benefit pension and OPEB plans (in thousands) :

Note 8 - Pension and Other Postretirement Benefits ( continued)

Fiscal quarter ended

July 1, 2023 Fiscal quarter ended

September 30, 2023 Fiscal quarter ended

October 1, 2022

Plans Pension

4 unchanged sentences

Net periodic benefit cost $ 51 $ 26 $ 149 $ 25

Six Fiscal Months Ended

July 1, 2023 Six Fiscal Months Ended

Nine Fiscal Months Ended

September 30, 2023 Nine Fiscal Months Ended

October 1, 2022

Plans Pension

7 unchanged sentences

2022 Stock Incentive Plan (the "2022 plan") permits issuance of up to 608,000 shares of common stock.

At July 1, 2023, the Company had reserved 525,239 shares of common stock for future grants of equity awards (restricted stock, unrestricted stock, restricted stock units ("RSUs"), or stock options) pursuant to the 2022 plan.

At September 30, 2023, the Company had reserved 525,239 shares of common stock for future grants of equity awards (restricted stock, unrestricted stock, restricted stock units ("RSUs"), or stock options) pursuant to the 2022 plan.

If any outstanding awards are forfeited by the holder or canceled by the Company, the underlying shares would be available for re-grant to others.

17 unchanged sentences

The following table summarizes share-based compensation expense recognized (in thousands) :

Fiscal quarter ended Six fiscal months ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine fiscal months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Share-based compensation expense $ 656 $ 559 $ 1,885 $ 1,583

1 unchanged sentence

It was determined that certain objectives were not likely to be fully met necessitating a reversal of certain compensation expenses associated with those awards.

The result of the evaluation of performance objectives as of the end of the third quarter of 2023 was consistent with the prior quarter's evaluation and therefore there was no further adjustment required during the third quarter of 2023.

Note 10 – Segment Information

10 unchanged sentences

Note 10 - Segment Information (continued)

Fiscal quarter ended Six fiscal months ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine fiscal months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Net revenues:

23 unchanged sentences

The table below summarizes intersegment sales (in thousands) :

Fiscal quarter ended Six fiscal months ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine fiscal months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Sensors to Weighing Solutions $ 417 $ 542 $ 1,178 $ 1,364

2 unchanged sentences

The following table sets forth the computation of basic and diluted earnings per share attributable to VPG stockholders (in thousands, except earnings per share) :

Fiscal quarter ended Six fiscal months ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine fiscal months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Numerator for basic earnings per share:

14 unchanged sentences

The caption “Other” on the consolidated condensed statements of operations consists of the following (in thousands) :

Fiscal quarter ended Six fiscal months ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Fiscal quarter ended Nine fiscal months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Foreign currency exchange gain $ 1,283 $ 1,261 $ 2,138 $ 5,195

4 unchanged sentences

Foreign currency exchange gains represent the impact of changes in foreign currency exchange rates.

For the fiscal quarter and six fiscal months ended July 1, 2023, the change in foreign currency exchange gains and losses during the periods, as compared to the prior year periods, is largely due to exposure to currency fluctuations with the Israeli shekel, the Canadian dollar, and the British pound.

For the fiscal quarter and nine fiscal months ended September 30, 2023, the change in foreign currency exchange gains and losses during the periods, as compared to the prior year periods, was largely due to exposure to currency fluctuations with the Israeli shekel, the Canadian dollar, the EURO and the British pound.

Note 12 – Additional Financial Statement Information ( continued)

For the fiscal quarter and six fiscal months ended July 2, 2022, the change in foreign exchange gains and losses during the periods, as compared to the prior year periods, is largely due to exposure to currency fluctuations with the Israeli shekel, the Japanese yen and the British pound.

For the fiscal quarter and nine fiscal months ended October 1, 2022, the change in foreign exchange gains and losses during the periods, as compared to the prior year periods, was largely due to exposure to currency fluctuations with the Israeli shekel, the Japanese yen, the Canadian dollar, and the British pound.

The change in the dollar-shekel exchange rate resulted in a favorable foreign exchange impact primarily related to the shekel-denominated lease liability for the Sensors facility in Israel.

Included in Other for the six fiscal months ended July 2, 2022 is a $ 0.2 million loss on the liquidation of two of the Company's European subsidiaries.

Included in Other for the nine fiscal months ended October 1, 2022 is a $ 0.2 million loss on the liquidation of two of the Company's European subsidiaries.

Other Accrued Expenses

Other accrued expenses consist of the following (in thousands) :

July 1, 2023 December 31, 2022

September 30, 2023 December 31, 2022

Customer advance payments $ 8,766 $ 7,983

22 unchanged sentences

Inputs Level 3

September 30, 2023

Assets held in rabbi trusts $ 5,571 $ 85 $ 5,486 $ —

3 unchanged sentences

The Company maintains non-qualified trusts, referred to as “rabbi” trusts, to fund payments under deferred compensation and non-qualified pension plans.

Rabbi trust assets consist primarily of marketable securities, classified as available-for-sale money market funds at July 1, 2023 and December 31, 2022, and company-owned life insurance assets.

Rabbi trust assets consist primarily of marketable securities, classified as available-for-sale money market funds at September 30, 2023 and December 31, 2022, and company-owned life insurance assets.

The marketable securities held in the rabbi trusts are valued using quoted market prices on the last business day of the period.

1 unchanged sentence

The fair value measurement of the cash equivalents held in the rabbi trust are considered a Level 1 measurement and the measurement of the company-owned life insurance assets is considered a Level 2 measurement within the fair value hierarchy.

The fair value of the long-term debt, excluding capitalized deferred financing costs, at July 1, 2023 and December 31, 2022 approximates its carrying value as the revolving debt is reset on a monthly basis based on current market rates, plus a base rate as specified in the debt agreement.

The fair value of the long-term debt, excluding capitalized deferred financing costs, at September 30, 2023 and December 31, 2022 approximates its carrying value as the revolving debt is reset on a monthly basis based on current market rates, plus a base rate as specified in the debt agreement.

The fair value of long-term debt is considered a Level 2 measurement within the fair value hierarchy.

6 unchanged sentences

If the initial estimates are too low or too high, the Company could be required either to record additional expense in future periods or to reverse part of the previously recorded charges.

The Company recorded $ 0.2 million and $ 0.9 million of restructuring costs during the fiscal quarter ended July 1, 2023 and July 2, 2022, respectively and $ 0.3 million and $ 1.2 million of restructuring costs during the six fiscal months ended July 1, 2023 and July 2, 2022, respectively.

The Company recorded $ 1.2 million and $ 0.2 million of restructuring costs during the fiscal quarter ended September 30, 2023 and October 1, 2022, respectively and $ 1.4 million and $ 1.3 million of restructuring costs during the nine fiscal months ended September 30, 2023 and October 1, 2022, respectively.

Restructuring costs were comprised primarily of employee termination costs, including severance and statutory retirement allowances, and were incurred in connection with various cost reduction programs.

The following table summarizes recent activity related to all restructuring programs.

The accrued restructuring liability balance as of July 1, 2023 and December 31, 2022, respectively, is included in Other accrued expenses in the accompanying consolidated condensed balance sheets (in thousands) :

The accrued restructuring liability balance as of September 30, 2023 and December 31, 2022, respectively, is included in Other accrued expenses in the accompanying consolidated condensed balance sheets (in thousands) :

Balance at December 31, 2022 $ 183

2 unchanged sentences

Foreign currency translation 2

Balance at July 1, 2023 $ 61

Note 15 – Subsequent Event

Balance at September 30, 2023 $ 911

Note 15 – Stockholder's Equity

On August 8, 2022, the Board of Directors (the “Board”) of the Company authorized the repurchase of up to 600,000 shares of the Company’s outstanding common stock (the “Stock Repurchase Plan”).

The Stock Repurchase Plan was originally set to expire on August 11, 2023.

On August 8, 2023, the Company announced that its Board of Directors extended the term of the previously approved stock repurchase plan to August 9, 2024.

From August 8, 2022 to September 30, 2023 , the Company had repurchased an aggregate of 120,419 shares of its common stock under the stock repurchase plan for consideration of $ 3.9 million.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements