VISHAY INTERTECHNOLOGY INC 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations This Management's Discussion and Analysis ("MD&A") is intended to provide an understanding of Vishay's financial condition, results of operations and cash flows by focusing on changes in certain key measures from period to period. The MD&A should be read in conjunction with our Consolidated Condensed Financial Statements and accompanying Notes included in Item 1. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed in our Annual Report on Form 10-K, particularly in Item 1A. "Risk Factors," filed with the Securities and Exchange Commission on February 24, 2021. Overview Vishay Intertechnology, Inc. ("Vishay," "we," "us," or "our") manufactures one of the world’s largest portfolios of discrete semiconductors and passive electronic components that are essential to innovative designs in the automotive, industrial, computing, consumer, telecommunications, military, aerospace, and medical markets. We operate in six segments based on product functionality: MOSFETs, Diodes, Optoelectronic Components, Resistors, Inductors, and Capacitors. We are focused on enhancing stockholder value by growing our business and improving earnings per share. Since 1985, we have pursued a business strategy of growth through focused research and development and acquisitions. We plan to continue to grow our business through intensified internal growth supplemented by opportunistic acquisitions, while at the same time maintaining a prudent capital structure. To foster intensified internal growth, we have increased our worldwide R&D and engineering technical staff; we are expanding critical manufacturing capacities; we are increasing our technical field sales force in Asia to increase our market access to the industrial segment and increase the design-in of our products in local markets; and we are directing increased funding and focus on developing products to capitalize on the connectivity, mobility, and sustainability growth drivers of our business. In addition to our growth plan, we also have opportunistically repurchased our stock and, as further described below, reduced dilution risks by repurchasing all of our convertible senior debentures. Over the next few years, we expect to experience higher growth rates than over the last decade. This expectation is based upon accelerated electrification, such as factory automation, electrical vehicles, and 5G infrastructure. In 2014, our Board of Directors instituted a quarterly dividend payment program and declared the first cash dividend in the history of Vishay. We have paid dividends each quarter since the first fiscal quarter of 2014, and currently pay quarterly cash dividends of $0.095 per share. We expect to continue to pay quarterly dividends, although each dividend is subject to approval by our Board of Directors. On May 20, 2020, our Board of Directors authorized a program to repurchase up to $200 million of the outstanding convertible senior notes due 2025 in open market repurchases or through privately negotiated transactions. Such transactions provide us more flexibility to adjust our debt levels if necessary. We have repurchased $134.7 million principal amount of convertible senior notes pursuant to this program. On February 4, 2021, we redeemed the remaining convertible senior debentures. Our business and operating results have been and will continue to be impacted by worldwide economic conditions. Our revenues are dependent on end markets that are impacted by consumer and industrial demand, and our operating results can be adversely affected by reduced demand in those global markets. The worldwide economy and, specifically, our business were impacted by the outbreak of the coronavirus ("COVID-19"), particularly in 2020. The pandemic significantly impacted the global market, including our customers, suppliers, and shipping partners, which impacted our net revenues. In 2020, w e also incurred incremental costs separable from normal operations that are directly attributable to the pandemic and containment efforts, primarily salaries and wages for employees impacted by quarantines and additional safety measures, including masks and temperature scanners, which were partially offset by government subsidies. Directly attributable costs of the pandemic are no longer incremental and have become part of normal operations. Accordingly, in 2021, they are considered in our normal operating costs. We excluded indirect financial changes such as general macroeconomic effects and higher shipping costs due to reduced shipping capacity from the COVID-19 amounts reported. We believe the economic impact of the COVID-19 pandemic on Vishay will be temporary. We have significant liquidity to withstand the temporary disruptions in the economic environment. However, we continue to closely monitor our fixed costs, capital expenditure plans, inventory, and capital resources to respond to changing conditions and to ensure we have the management, business processes, and resources to meet our future needs. We will react quickly and professionally to changes in demand to minimize manufacturing inefficiencies and excess inventory build in periods of decline and maximize opportunities in periods of growth. The global cost reduction and management rejuvenation programs that we began as part of our continuous efforts to improve efficiency and operating performance in 2019 have been fully implemented. We utilize several financial metrics, including net revenues, gross profit margin, segment operating income, end-of-period backlog, book-to-bill ratio, inventory turnover, change in average selling prices, net cash and short-term investments (debt), and free cash generation to evaluate the performance and assess the future direction of our business. See further discussion in “Financial Metrics” and “Financial Condition, Liquidity, and Capital Resources” below. The COVID-19 pandemic impacted almost all key financial metrics in 2020. We experienced a broad recovery in orders and sales beginning in the third fiscal quarter of 2020 that continued to accelerate in the first fiscal quarter. The increases in orders and sales positively impacted almost all key financial metrics. Net revenues for the fiscal quarter ended April 3, 2021 were $764.6 million, compared to $667.2 million and $612.8 million for the fiscal quarters ended December 31, 2020 and April 4, 2020, respectively. The net earnings attributable to Vishay stockholders for the fiscal quarter ended April 3, 2021 were $71.4 million, or $0.49 per diluted share, compared to $37.6 million, or $0.26 per diluted share for the fiscal quarter ended December 31, 2020, and $27.2 million, or $0.19 per diluted share for the fiscal quarter ended April 4, 2020. 26 We define adjusted net earnings as net earnings determined in accordance with GAAP adjusted for various items that management believes are not indicative of the intrinsic operating performance of our business. We define free cash as the cash flows generated from continuing operations less capital expenditures plus net proceeds from the sale of property and equipment. The reconciliations below include certain financial measures which are not recognized in accordance with GAAP, including adjusted net earnings, adjusted earnings per share, and free cash. These non-GAAP measures should not be viewed as alternatives to GAAP measures of performance or liquidity. Non-GAAP measures such as adjusted net earnings, adjusted earnings per share, and free cash do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Management believes that adjusted net earnings and adjusted earnings per share are meaningful because they provide insight with respect to our intrinsic operating results. Management believes that free cash is a meaningful measure of our ability to fund acquisitions, repay debt, and otherwise enhance stockholder value through stock repurchases or dividends. Net earnings attributable to Vishay stockholders for the fiscal quarters ended April 3, 2021, December 31, 2020, and April 4, 2020 include items affecting comparability. The items affecting comparability are ( in thousands, except per share amounts ): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 GAAP net earnings attributable to Vishay stockholders $ 71,435 $ 37,567 $ 27,219 Reconciling items affecting gross income: Impact of COVID-19 pandemic $ - $ 268 $ 3,130 Other reconciling items affecting operating income: Impact of COVID-19 pandemic $ - $ (580 ) $ 317 Reconciling items affecting other income (expense): Loss on early extinguishment of debt $ - $ 553 $ 2,920 Reconciling items affecting tax expense: Change in tax regulation $ (4,395 ) $ - $ - Change in deferred taxes due to early extinguishment of debt - (217 ) (1,346 ) Effects of changes in uncertain tax positions - 3,751 - Tax effects of pre-tax items above - (12 ) (1,482 ) Adjusted net earnings $ 67,040 $ 41,330 $ 30,758 Adjusted weighted average diluted shares outstanding 145,463 145,251 145,295 Adjusted earnings per diluted share $ 0.46 $ 0.28 $ 0.21 Although the term "free cash" is not defined in GAAP, each of the elements used to calculate free cash for the year-to-date period is presented as a line item on the face of our consolidated condensed statement of cash flows prepared in accordance with GAAP and the quarterly amounts are derived from the year-to-date GAAP statements as of the beginning and end of the respective quarter. Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net cash provided by continuing operating activities $ 57,322 $ 125,699 $ 34,478 Proceeds from sale of property and equipment 200 110 53 Less: Capital expenditures (28,527 ) (52,798 ) (24,328 ) Free cash $ 28,995 $ 73,011 $ 10,203 Our results for the fiscal quarters ended April 3, 2021 and December 31, 2020 represent the continuation of the sharp and broad recovery that we began to experience in the third fiscal quarter of 2020. Our results for the fiscal quarter ended April 4, 2020 represent the beginning of an expected recovery from the normalization of demand experienced in 2019, which was negatively impacted by the beginning of the COVID-19 pandemic. Our percentage of euro-based sales approximates our percentage of euro-based expenses so the foreign currency impact on revenues was substantially offset by the impact on expenses. Our pre-tax results were consistent with expectations based on our business model. 27 Financial Metrics We utilize several financial metrics to evaluate the performance and assess the future direction of our business. These key financial measures and metrics include net revenues, gross profit margin, operating margin, segment operating income, end-of-period backlog, and the book-to-bill ratio. We also monitor changes in inventory turnover and our or publicly available average selling prices (“ASP”). Gross profit margin is computed as gross profit as a percentage of net revenues. Gross profit is generally net revenues less costs of products sold, but also deducts certain other period costs, particularly losses on purchase commitments and inventory write-downs. Losses on purchase commitments and inventory write-downs have the impact of reducing gross profit margin in the period of the charge, but result in improved gross profit margins in subsequent periods by reducing costs of products sold as inventory is used. Gross profit margin is clearly a function of net revenues, but also reflects our cost management programs and our ability to contain fixed costs. Operating margin is computed as gross profit less operating expenses as a percentage of net revenues. We evaluate business segment performance on segment operating margin. Only dedicated, direct selling, general, and administrative expenses of the segments are included in the calculation of segment operating income. Segment operating margin is computed as operating income less items such as restructuring and severance costs, asset write-downs, goodwill and indefinite-lived intangible asset impairments, inventory write-downs, gains or losses on purchase commitments, global operations, sales and marketing, information systems, finance and administrative groups, and other items, expressed as a percentage of net revenues. We believe that evaluating segment performance excluding such items is meaningful because it provides insight with respect to intrinsic operating results of the segment. Operating margin is clearly a function of net revenues, but also reflects our cost management programs and our ability to contain fixed costs. End-of-period backlog is one indicator of future revenues. We include in our backlog only open orders that we expect to ship in the next twelve months. If demand falls below customers’ forecasts, or if customers do not control their inventory effectively, they may cancel or reschedule the shipments that are included in our backlog, in many instances without the payment of any penalty. Therefore, the backlog is not necessarily indicative of the results to be expected for future periods. An important indicator of demand in our industry is the book-to-bill ratio, which is the ratio of the amount of product ordered during a period as compared with the product that we ship during that period. A book-to-bill ratio that is greater than one indicates that our backlog is building and that we are likely to see increasing revenues in future periods. Conversely, a book-to-bill ratio that is less than one is an indicator of declining demand and may foretell declining revenues. We focus on our inventory turnover as a measure of how well we are managing our inventory. We define inventory turnover for a financial reporting period as our costs of products sold for the four fiscal quarters ending on the last day of the reporting period divided by our average inventory (computed using each fiscal quarter-end balance) for this same period. A higher level of inventory turnover reflects more efficient use of our capital. Pricing in our industry can be volatile. Using our and publicly available data, we analyze trends and changes in average selling prices to evaluate likely future pricing. We attempt to offset deterioration in the average selling prices of established products with ongoing cost reduction activities and new product introductions. Our specialty passive components are more resistant to average selling price erosion. All pricing is subject to governing market conditions and is independently set by us. 28 The quarter-to-quarter trends in these financial metrics can also be an important indicator of the likely direction of our business. The following table shows net revenues, gross profit margin, operating margin, end-of-period backlog, book-to-bill ratio, inventory turnover, and changes in ASP for our business as a whole during the five fiscal quarters beginning with the first fiscal quarter of 2020 through the first fiscal quarter of 2021 (dollars in thousands) : 1st Quarter 2020 2nd Quarter 2020 3rd Quarter 2020 4th Quarter 2020 1st Quarter 2021 Net revenues $ 612,841 $ 581,717 $ 640,160 $ 667,180 $ 764,632 Gross profit margin (1) 24.0 % 22.5 % 23.7 % 22.8 % 26.5 % Operating margin (2) 7.7 % 7.0 % 9.6 % 9.0 % 12.7 % End-of-period backlog $ 1,005,200 $ 914,300 $ 927,900 $ 1,239,800 $ 1,731,200 Book-to-bill ratio 1.17 0.82 0.99 1.44 1.67 Inventory turnover 4.2 3.9 4.4 4.6 4.8 Change in ASP vs. prior quarter (1.1 )% 0.1 % (1.1 )% (0.3 )% (0.5 )% _________________________________________ (1) Gross margin for the first, second, third, and fourth fiscal quarters of 2020 includes $3.1 million, $0.9 million, $0.2 million, and $0.3 million, respectively, of expenses directly related to the COVID-19 pandemic. (2) Operating margin for the second fiscal quarter of 2020 includes $0.7 million of restructuring and severance expenses (see Note 3 to our consolidated condensed financial statements). Operating margin for the first, second, third, and fourth fiscal quarters of 2020 also includes in total $3.4 million, $0.2 million, $(0.2) million, and $(0.3) million, respectively, of expenses (benefits) directly related to the COVID-19 pandemic. See “Financial Metrics by Segment” below for net revenues, book-to-bill ratio, and gross profit margin broken out by segment. Revenues increased versus the prior fiscal quarter and the first fiscal quarter of 2020. The recovery in demand that began in the third fiscal quarter of 2020 accelerated further in the first fiscal quarter of 2021. Quarterly orders and backlog reached all-time highs. The high order level and rapid increase in our manufacturing capacities substantially increased revenues. The increased orders significantly increased the book-to-bill ratio and the backlog. Distributor inventory levels continued to decrease in the first fiscal quarter of 2021. Pressure on average selling prices has decreased during the broad recovery and is currently continuing to decrease. Gross profit margin increased versus the prior fiscal quarter and the first fiscal quarter of 2020. The increases are primarily due to increased volume and manufacturing efficiencies. The book-to-bill ratio in the first fiscal quarter of 2021 increased to 1.67 versus 1.44 in the fourth fiscal quarter of 2020. The book-to-bill ratios in the first fiscal quarter of 2021 for distributors and original equipment manufacturers ("OEM") were 1.89 and 1.41, respectively, versus ratios of 1.89 and 0.96, respectively, during the fourth fiscal quarter of 2020. For the second fiscal quarter of 2021, we anticipate revenues between $790 million and $830 million at a gross margin of 27.3% plus/minus 60 basis points. 29 Financial Metrics by Segment The following table shows net revenues, book-to-bill ratio, gross profit margin, and segment operating margin broken out by segment for the five fiscal quarters beginning with the first fiscal quarter of 2020 through the first fiscal quarter of 2021 (dollars in thousands) : 1st Quarter 2020 2nd Quarter 2020 3rd Quarter 2020 4th Quarter 2020 1st Quarter 2021 MOSFETs Net revenues $ 116,893 $ 118,944 $ 133,976 $ 131,567 $ 153,223 Book-to-bill ratio 1.12 0.97 0.93 1.64 1.97 Gross profit margin 24.1 % 22.7 % 22.1 % 22.4 % 24.2 % Segment operating margin 16.0 % 14.8 % 15.0 % 15.3 % 17.8 % Diodes Net revenues $ 115,343 $ 124,187 $ 123,744 $ 139,274 $ 157,178 Book-to-bill ratio 1.36 0.61 1.05 1.65 1.85 Gross profit margin 16.9 % 20.1 % 16.8 % 17.8 % 21.9 % Segment operating margin 12.5 % 16.0 % 12.8 % 14.1 % 18.3 % Optoelectronic Components Net revenues $ 54,179 $ 49,130 $ 64,955 $ 68,352 $ 77,771 Book-to-bill ratio 1.40 0.96 0.97 1.46 1.66 Gross profit margin 26.9 % 23.9 % 32.8 % 27.7 % 33.0 % Segment operating margin 19.7 % 16.2 % 26.5 % 21.3 % 27.3 % Resistors Net revenues $ 159,208 $ 140,412 $ 145,362 $ 161,201 $ 186,602 Book-to-bill ratio 1.05 0.73 1.06 1.24 1.50 Gross profit margin 28.1 % 23.2 % 24.2 % 25.3 % 28.9 % Segment operating margin 24.4 % 19.9 % 20.7 % 21.0 % 25.4 % Inductors Net revenues $ 73,785 $ 65,185 $ 79,399 $ 75,260 $ 83,458 Book-to-bill ratio 0.98 0.96 0.96 1.03 1.13 Gross profit margin 31.2 % 31.1 % 33.5 % 30.1 % 33.3 % Segment operating margin 27.5 % 27.2 % 30.4 % 27.0 % 30.3 % Capacitors Net revenues $ 93,433 $ 83,859 $ 92,724 $ 91,526 $ 106,400 Book-to-bill ratio 1.20 0.90 0.95 1.54 1.73 Gross profit margin 21.8 % 18.1 % 19.8 % 17.5 % 22.6 % Segment operating margin 16.1 % 12.5 % 14.8 % 12.5 % 17.7 % 30 Cost Management We place a strong emphasis on controlling our costs, and use various measures and metrics to evaluate our cost structure. We define variable costs as expenses that vary with respect to quantity produced. Fixed costs do not vary with respect to quantity produced over the relevant time period. Contributive margin is calculated as net revenue less variable costs. It may be expressed in dollars or as a percentage of net revenue. Management uses this measure to determine the amount of profit to be expected for any change in revenues. While these measures are typical cost accounting measures, none of these measures are recognized in accordance with GAAP. The classification of expenses as either variable or fixed is judgmental and other companies might classify such expenses differently. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. We closely monitor variable costs and seek to achieve the contributive margin in our business model. Over a period of many years, we have generally maintained a contributive margin of between 45% - 47% of revenues. The erosion of average selling prices, particularly of our semiconductor products, that is typical of our industry and inflation negatively impact contributive margin and drive us to continually seek ways to reduce our variable costs. Our variable cost reduction efforts include increasing the efficiency in our production facilities by expending capital for automation, reducing materials costs, materials substitution, increasing wafer size and shrinking dies to maximize efficiency in our semiconductor production processes, and other yield improvement activities. Our cost management strategy also includes a focus on controlling fixed costs recorded as costs of products sold or selling, general, and administrative expenses and maintaining our break-even point (adjusted for acquisitions). We seek to limit increases in selling, general, and administrative expenses to the rate of inflation, excluding foreign currency exchange effects and substantially independent of sales volume changes. At constant fixed costs, we would expect each $1 million increase in revenues to increase our operating income by approximately $450,000 to $470,000. Sudden changes in the business conditions, however, may not allow us to quickly adapt our manufacturing capacity and cost structure. Occasionally, our ongoing cost containment activities are not adequate and we must take actions to maintain our cost competitiveness. We incurred significant restructuring expenses in our past to reduce our cost structure. Historically, our primary cost reduction technique was through the transfer of production to the extent possible from high-labor-cost countries to lower-labor-cost countries. We believe that our manufacturing footprint is suitable to serve our customers and end markets, while maintaining lower manufacturing costs. Since 2013, our cost reduction programs have primarily focused on reducing fixed costs, including selling, general, and administrative expenses. We continue to monitor the economic environment and its potential effects on our customers and the end markets that we serve. We do not anticipate any material restructuring activities in 2021. However, a worsening business environment for the electronics industry, a prolonged impact of the COVID-19 pandemic, or a significant economic downturn may require us to implement additional restructuring initiatives. In uncertain times, we focus on managing our production capacities in accordance with customer requirements, and maintain discipline in terms of our fixed costs and capital expenditures. Even as we seek to manage our costs, we remain cognizant of the future requirements of our demanding markets. We continue to pursue our growth plans through investing in capacities for strategic product lines, and through increasing our resources for R&D, technical marketing, and field application engineering; supplemented by opportunistic acquisitions of specialty businesses. Our long-term strategy includes growth through the integration of acquired businesses, and GAAP requires plant closure and employee termination costs that we incur in connection with our acquisition activities to be recorded as expenses in our consolidated statement of operations, as such expenses are incurred. We have not incurred any material plant closure or employee termination costs related to any of the businesses acquired since 2011, but we expect to have some level of future restructuring expenses due to acquisitions. 31 Foreign Currency Translation We are exposed to foreign currency exchange rate risks, particularly due to transactions in currencies other than the functional currencies of certain subsidiaries. We occasionally use forward exchange contracts to economically hedge a portion of these exposures. GAAP requires that we identify the “functional currency” of each of our subsidiaries and measure all elements of the financial statements in that functional currency. A subsidiary’s functional currency is the currency of the primary economic environment in which it operates. In cases where a subsidiary is relatively self-contained within a particular country, the local currency is generally deemed to be the functional currency. However, a foreign subsidiary that is a direct and integral component or extension of the parent company’s operations generally would have the parent company’s currency as its functional currency. We have both situations among our subsidiaries. Foreign Subsidiaries which use the Local Currency as the Functional Currency We finance our operations in Europe and certain locations in Asia in local currencies, and accordingly, these subsidiaries utilize the local currency as their functional currency. For those subsidiaries where the local currency is the functional currency, assets and liabilities in the consolidated condensed balance sheets have been translated at the rate of exchange as of the balance sheet date. Translation adjustments do not impact the results of operations and are reported as a separate component of stockholders’ equity. For those subsidiaries where the local currency is the functional currency, revenues and expenses incurred in the local currency are translated at the average exchange rate for the year. While the translation of revenues and expenses incurred in the local currency into U.S. dollars does not directly impact the statements of operations, the translation effectively increases or decreases the U.S. dollar equivalent of revenues generated and expenses incurred in those foreign currencies. The dollar generally was weaker during the first fiscal quarter of 2020 compared to the prior fiscal quarter and prior year quarter, with the translation of foreign currency revenues and expenses into U.S. dollars increasing reported revenues and expenses versus the prior fiscal quarter and prior year quarter. Foreign Subsidiaries which use the U.S. Dollar as the Functional Currency Our operations in Israel and most significant locations in Asia are largely financed in U.S. dollars, and accordingly, these subsidiaries utilize the U.S. dollar as their functional currency. For those foreign subsidiaries where the U.S. dollar is the functional currency, all foreign currency financial statement amounts are remeasured into U.S. dollars. Exchange gains and losses arising from remeasurement of foreign currency-denominated monetary assets and liabilities are included in the results of operations. While these subsidiaries transact most business in U.S. dollars, they may have significant costs, particularly payroll-related, which are incurred in the local currency. The cost of products sold for the first fiscal quarter of 2021 have been unfavorably impacted compared to the prior fiscal quarter and prior year quarter by local currency transactions of subsidiaries which use the U.S. dollar as their functional currency. 32 Results of Operations Statements of operations’ captions as a percentage of net revenues and the effective tax rates were as follows: Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Cost of products sold 73.5 % 77.2 % 76.0 % Gross profit 26.5 % 22.8 % 24.0 % Selling, general & administrative expenses 13.8 % 13.8 % 16.3 % Operating income 12.7 % 9.0 % 7.7 % Income before taxes and noncontrolling interest 11.4 % 7.0 % 5.9 % Net earnings attributable to Vishay stockholders 9.3 % 5.6 % 4.4 % ________ Effective tax rate 17.8 % 19.0 % 24.2 % Net Revenues Net revenues were as follows (dollars in thousands) : Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 764,632 $ 667,180 $ 612,841 The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 97,452 14.6 % April 4, 2020 $ 151,791 24.8 % Changes in net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 14.7 % 21.8 % Decrease in average selling prices -0.5 % -1.4 % Foreign currency effects 0.5 % 3.4 % Acquisition 0.0 % 1.0 % Other -0.1 % 0.0 % Net change 14.6 % 24.8 % Demand for our products began to be negatively impacted by the COVID-19 pandemic in the first fiscal quarter of 2020. We experienced a significant decrease in demand in the second fiscal quarter of 2020 followed by a broad recovery beginning in the third fiscal quarter of 2020 that accelerated through the first fiscal quarter of 2021. The increasing demand resulted in increased net revenues compared to the prior fiscal quarter and prior year quarter. Gross Profit Margins Gross profit margins for the fiscal quarter ended April 3, 2021 were 26.5%, versus 22.8% and 24.0% for the comparable prior fiscal quarter and prior year period, respectively. The increases versus the prior fiscal quarter and the prior year quarter are primarily due to increased volume. We were able to offset the negative impacts of inflation and average selling price decline and maintain our contributive margin. 33 Segments Analysis of revenues and gross profit margins for our segments is provided below. MOSFETs Net revenues and gross profit margin of the MOSFETs segment were as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 153,223 $ 131,567 $ 116,893 Gross profit margin 24.2 % 22.4 % 24.1 % The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 21,656 16.5 % April 4, 2020 $ 36,330 31.1 % Changes in MOSFETs segment net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 18.7 % 37.0 % Decrease in average selling prices -1.4 % -4.5 % Foreign currency effects 0.2 % 1.8 % Other -1.0 % -3.2 % Net change 16.5 % 31.1 % The MOSFET segment net revenues increased significantly versus the prior fiscal quarter and prior year quarter. Net revenues increased for customers in all regions. The increase versus the prior year quarter was partially due to increased sales to distributor customers and the temporary closure of our main manufacturing facility in China during the first fiscal quarter of 2020 due to the COVID-19 pandemic that impacted prior year results. Gross profit margin increased versus the prior fiscal quarter and the prior year quarter. The increase versus the prior fiscal quarter is primarily due to higher sales volume and cost reduction measures, partially offset by lower average selling prices, cost inflation, and the negative impact of an inventory reduction. The increase versus the prior year quarter is primarily due to higher sales volume, almost completely offset by lower average selling prices, higher metals prices, cost inflation, and the negative impact of an inventory reduction. Average selling prices decreased slightly versus the prior fiscal quarter and moderately versus the prior year quarter. We continue to invest to expand mid- and long-term manufacturing capacity for strategic product lines. 34 Diodes Net revenues and gross profit margins of the Diodes segment were as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 157,178 $ 139,274 $ 115,343 Gross profit margin 21.9 % 17.8 % 16.9 % The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 17,904 12.9 % April 4, 2020 $ 41,835 36.3 % Changes in Diodes segment net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 13.0 % 33.2 % Decrease in average selling prices -0.4 % -0.7 % Foreign currency effects 0.4 % 3.3 % Other -0.1 % 0.5 % Net change 12.9 % 36.3 % Net revenues of the Diodes segment increased significantly versus the prior fiscal quarter and prior year quarter. Net revenues increased for customers in all regions. The increase versus the prior fiscal quarter was primarily due to increased sales to distributor customers in the Europe and Americas regions. The increase versus the prior year quarter was partially due to increased sales to distributor customers compared to the prior year quarter when distributor customers decreased inventory due to the COVID-19 pandemic. Gross profit margin increased versus the prior fiscal quarter and the prior year quarter. The increase versus the prior fiscal quarter was primarily due to increased sales volume, cost reduction measures, and the positive impact of an inventory increase, partially offset by cost inflation and lower average selling prices. The increase versus the prior year quarter is primarily due to increased sales volume, cost reduction measures, and the positive impact of an inventory increase, partially offset by cost inflation, higher metals prices, and lower average selling prices. Average selling prices decreased slightly versus the prior fiscal quarter and prior year quarter. 35 O ptoelectronic Components Net revenues and gross profit margins of the Optoelectronic Components segment were as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 77,771 $ 68,352 $ 54,179 Gross profit margin 33.0 % 27.7 % 26.9 % The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 9,419 13.8 % April 4, 2020 $ 23,592 43.5 % Changes in Optoelectronic Components segment net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 14.6 % 38.4 % Decrease in average selling prices -1.3 % -0.2 % Foreign currency effects 0.4 % 4.6 % Other 0.1 % 0.7 % Net change 13.8 % 43.5 % Net revenues of our Optoelectronic Components segment increased significantly versus the prior fiscal quarter and prior year quarter. Net revenues increased for customers in all regions. Sales to distributor customers continues to increase. Gross profit margin increased versus the prior fiscal quarter and prior year quarter. The increase versus the prior fiscal quarter is primarily due to increased sales volume, greater efficiencies, and the positive impact of an inventory increase. The increase versus the prior year quarter is primarily due to increased sales volume and cost reduction measures, partially offset by cost inflation and higher metals prices. Average selling prices decreased slightly versus the prior fiscal quarter and prior year quarter. 36 Resistors Net revenues and gross profit margins of the Resistors segment were as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 186,602 $ 161,201 $ 159,208 Gross profit margin 28.9 % 25.3 % 28.1 % The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 25,401 15.8 % April 4, 2020 $ 27,394 17.2 % Changes in Resistors segment net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 15.4 % 9.9 % Decrease in average selling prices -0.4 % -1.3 % Foreign currency effects 0.8 % 4.6 % Acquisition 0.0 % 3.7 % Other 0.0 % 0.3 % Net change 15.8 % 17.2 % Net revenues of the Resistors segment increased significantly versus the prior fiscal quarter and prior year quarter. The increase versus the prior fiscal quarter is primarily due to increased sales to distributor customers and industrial end market customers in all regions, particularly Europe and Asia. The increase versus the prior year period is primarily due to increased sales to distributor customers and automotive end market customers, particularly in Asia. The gross profit margin increased versus the prior fiscal quarter and prior year quarter. The increase versus the prior fiscal quarter is primarily due to increased sales volume, greater efficiencies, and the positive impact of an inventory increase, partially offset by higher metals prices. The increase versus the prior year quarter is due to increased sales volume, greater efficiencies, and positive exchange rate impact, partially offset by decreased average selling prices and higher fixed costs. Average selling prices decreased slightly versus the prior fiscal quarter and prior year quarter. We are increasing critical manufacturing capacities for certain product lines. 37 Inductors Net revenues and gross profit margins of the Inductors segment were as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 83,458 $ 75,260 $ 73,785 Gross profit margin 33.3 % 30.1 % 31.2 % The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 8,198 10.9 % April 4, 2020 $ 9,673 13.1 % Changes in Inductors segment net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 9.9 % 14.6 % Change in average selling prices 0.7 % -2.4 % Foreign currency effects 0.1 % 1.5 % Other 0.2 % -0.6 % Net change 10.9 % 13.1 % Net revenues of the Inductors segment increased significantly versus the prior fiscal quarter and prior year quarter. The increase versus the prior fiscal quarter is primarily due to increased sales to distributor customers and medical and automotive end market customers, particularly in the Americas region. The increase versus the prior year quarter is primarily due to increased sales to distributor customers and automotive and industrial end market customers, particularly in Asia. The gross profit margin increased versus the prior fiscal quarter and the prior year quarter. The increases versus the prior fiscal quarter and prior year quarter are primarily due to higher sales volume, improved efficiencies, and variable cost reductions. Lower average selling prices and higher metals prices partially offset the increase versus the prior year quarter. Average selling prices increased versus the prior fiscal quarter, but decreased versus the prior year quarter. We expect long-term growth in this segment, and are accelerating capacity expansion to capitalize on future market upturns. 38 Capacitors Net revenues and gross profit margins of the Capacitors segment were as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Net revenues $ 106,400 $ 91,526 $ 93,433 Gross profit margin 22.6 % 17.5 % 21.8 % The change in net revenues versus the comparable prior periods was as follows (dollars in thousands) : Fiscal quarter ended April 3, 2021 Change in net revenues % change December 31, 2020 $ 14,874 16.3 % April 4, 2020 $ 12,967 13.9 % Changes in Capacitors segment net revenues were attributable to the following: vs. Prior Quarter vs. Prior Year Quarter Change attributable to: Increase in volume 14.7 % 6.8 % Change in average selling prices 0.0 % 1.7 % Foreign currency effects 0.8 % 4.4 % Other 0.8 % 1.0 % Net change 16.3 % 13.9 % Net revenues of the Capacitors segment increased significantly versus the prior fiscal quarter and prior year quarter. Net revenues increased versus the prior fiscal quarter primarily due to increased sales to distributor customers and industrial end market customers, particularly in Europe. Net revenues increased versus the prior year quarter primarily due to increased sales to distributor customers in Europe and Asia. The gross profit margin increased versus the prior fiscal quarter and the prior year quarter. The increase versus the prior fiscal quarter is primarily due to higher sales volume, manufacturing efficiencies, and the positive impact of an inventory increase. The increase versus the prior year quarter is primarily due to higher sales volume, manufacturing efficiencies, and increased average selling prices, partially offset by the negative impact of product mix and increased metals prices. Average selling prices were consistent with the prior fiscal quarter and increased slightly versus the prior year quarter primarily due to increased prices for certain materials that were passed through to our customers. 39 Selling, General, and Administrative Expenses Selling, general, and administrative (“SG&A”) expenses are summarized as follows (dollars in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 April 4, 2020 Total SG&A expenses $ 105,685 $ 92,272 $ 99,832 as a percentage of revenues 13.8 % 13.8 % 16.3 % The sequential increase in SG&A expenses is primarily attributable to uneven attribution of stock compensation expense and increased incentive compensation accruals. SG&A expenses increased versus the prior year quarter due to increased incentive compensation accruals and foreign exchange rates. SG&A expenses for the fiscal quarters ended December 31, 2020 and April 4, 2020 include $(0.6) million and $0.3 million, respectively, of incremental costs (benefits) separable from normal operations directly attributable to the COVID-19 pandemic. Other Income (Expense) Interest expense for the fiscal quarter ended April 3, 2021 decreased $2.8 million versus the fiscal quarter ended December 31, 2020 and decreased by $4.2 million versus the fiscal quarter ended April 4, 2020. The decreases are primarily due to the elimination of non-cash debt discount amortization upon the adoption of ASU No. 2020-06 effective January 1, 2021 and repurchases of convertible notes in the second and third fiscal quarters of 2020. See Note 1 to the consolidated condensed financial statements. The following tables analyze the components of the line “Other” on the consolidated condensed statements of operations (in thousands): Fiscal quarters ended April 3, 2021 December 31, 2020 Change Foreign exchange gain (loss) $ (611 ) $ (2,437 ) $ 1,826 Interest income 287 385 (98 ) Other components of other periodic pension cost (3,302 ) (4,215 ) 913 Investment income (expense) (2,121 ) 701 (2,822 ) Other 16 (4 ) 20 $ (5,731 ) $ (5,570 ) $ (161 ) Fiscal quarters ended April 3, 2021 April 4, 2020 Change Foreign exchange gain (loss) $ (611 ) $ 1,864 $ (2,475 ) Interest income 287 1,854 (1,567 ) Other components of other periodic pension cost (3,302 ) (3,068 ) (234 ) Investment income (expense) (2,121 ) (437 ) (1,684 ) Other 16 (15 ) 31 $ (5,731 ) $ 198 $ (5,929 ) 40 Income Taxes For the fiscal quarter ended April 3, 2021, our effective tax rate was 17.8%, as compared to 19.0% and 24.2% for the fiscal quarters ended December 31, 2020 and April 4, 2020, respectively. With the reduction in the U.S. statutory rate to 21% beginning January 1, 2018, we expect that our effective tax rate will now be higher than the U.S. statutory rate, excluding unusual transactions. Historically, the effective tax rates were generally less than the U.S. statutory rate primarily because of earnings in foreign jurisdictions. Discrete tax items impacted our effective tax rate for each fiscal quarter presented. These items were $(4.4) million (tax benefit) in the fiscal quarter ended April 3, 2021, $3.5 million in the fiscal quarter ended December 31, 2020, and $(1.3) million (tax benefit) in the fiscal quarter ended April 4, 2020. The effective tax rate for the fiscal quarter ended April 3, 2021 was impacted by $4.4 million tax benefit recognized due to a change in tax regulations. The effective tax rates for the fiscal quarters ended December 31, 2020 and April 4, 2020 were impacted by the effect of the repurchase of convertible senior debentures. We recognized tax benefits of $0.2 million and $1.3 million in the fiscal quarters ended December 31, 2020, and April 4, 2020, respectively, resulting from the extinguishments, reflecting the reduction in deferred tax liabilities related to the special tax attributes of the debentures. The effective tax rate for the fiscal quarter ended December 31, 2020 was also impacted by $3.8 million of net tax expense for changes in uncertain tax positions. During the three fiscal months ended April 3, 2021 , the liabilities for unrecognized tax benefits decreased by $1.5 million on a net basis, primarily due to a payment and currency translation adjustments, partially offset by accruals for current year tax positions and interest. We operate in a global environment with significant operations in various locations outside the United States. Accordingly, the consolidated income tax rate is a composite rate reflecting our earnings and the applicable tax rates in the various locations where we operate. Part of our historical strategy has been to achieve cost savings through the transfer and expansion of manufacturing operations to countries where we can take advantage of lower labor costs and available tax and other government-sponsored incentives. Additional information about income taxes is included in Note 4 to our consolidated condensed financial statements. 41 Financial Condition, Liquidity, and Capital Resources We focus on our ability to generate cash flows from operations. The cash generated from operations is used to fund our capital expenditure plans, and cash in excess of our capital expenditure needs is available to fund our acquisition strategy, to reduce debt levels, and to pay dividends and repurchase stock. We have generated cash flows from operations in excess of $200 million in each of the last 19 years, and cash flows from operations in excess of $100 million in each of the last 26 years. Management uses a non-GAAP measure, "free cash," to evaluate our ability to fund acquisitions, repay debt, and otherwise enhance stockholder value through stock repurchases or dividends. See "Overview" above for "free cash" definition and reconciliation to GAAP. Vishay has generated positive "free cash" in each of the past 24 years, and "free cash" in excess of $80 million in each of the last 19 years. In this volatile economic environment, we continue to focus on the generation of free cash, including an emphasis on cost controls. We expect our business to continue to be a reliable generator of free cash. There is no assurance, however, that we will be able to continue to generate cash flows from operations and free cash at the same levels, or at all, going forward if the economic environment worsens. We generated cash flows from operations of $57.3 million and "free cash" of $29.0 million in the fiscal quarter ended April 3, 2021. The COVID-19 pandemic and the mitigation efforts by governments to control its spread has not had a significant impact on our financial condition, liquidity, or capital resources. We completed our cash repatriation program that we initiated in response to the U.S. Tax Cuts and Jobs Act ("TCJA") in 2020. We continue to evaluate the TCJA's provisions and may further adjust our financial and capital structure and business practices accordingly. We maintain a revolving credit facility, which provides an aggregate commitment of $750 million of revolving loans available until June 5, 2024. The maximum amount available on the revolving credit facility is restricted by the financial covenants described below. The credit facility also provides us the ability to request up to $300 million of incremental facilities, subject to the satisfaction of certain conditions, which could take the form of additional revolving commitments, incremental “term loan A” or “term loan B” facilities, or incremental equivalent debt. At December 31, 2020, we had no amounts outstanding on our revolving credit facility. We had no amounts outstanding at April 3, 2021. We borrowed $191 million and repaid $191 million on the revolving credit facility during the three fiscal months ended April 3, 2021. The average outstanding balance on our revolving credit facility calculated at fiscal month-ends was $87.3 million and the highest amount outstanding on our revolving credit facility at a fiscal month end was $135 million during the three fiscal months ended April 3, 2021. The revolving credit facility limits or restricts us from, among other things, incurring indebtedness, incurring liens on its respective assets, making investments and acquisitions (assuming our pro forma leverage ratio is greater than 2.75 to 1.00), making asset sales, and paying cash dividends and making other restricted payments (assuming our pro forma leverage ratio is greater than 2.50 to 1.00), and requires us to comply with other covenants, including the maintenance of specific financial ratios. The financial maintenance covenants include (a) an interest coverage ratio of not less than 2.00 to 1; and (b) a leverage ratio of not more than 3.25 to 1 (and a pro forma ratio of 3.00 to 1 on the date of incurrence of additional debt). The computation of these ratios is prescribed in Article VI of the Credit Agreement between Vishay Intertechnology, Inc. and JPMorgan Chase Bank, N.A., which has been filed with the SEC as Exhibit 10.1 to our current report on Form 8-K filed June 5, 2019. We were in compliance with all financial covenants under the credit facility at April 3, 2021. Our interest coverage ratio and leverage ratio were 19.51 to 1 and 1.12 to 1, respectively. We expect to continue to be in compliance with these covenants based on current projections. Based on our current EBITDA and outstanding revolver balance, the full amount of the revolving credit facility is useable. If we are not in compliance with all of the required financial covenants, the credit facility could be terminated by the lenders, and any amounts then outstanding pursuant to the credit facility could become immediately payable. Additionally, our convertible senior notes due 2025 have cross-default provisions that could accelerate repayment in the event the indebtedness under the credit facility is accelerated. 42 The credit facility allows an unlimited amount of defined “Investments,” which include certain intercompany transactions and acquisitions, provided our pro forma leverage ratio is equal to or less than 2.75 to 1.00. If our pro forma leverage ratio is greater than 2.75 to 1.00, such Investments are subject to certain limitations. The credit facility also allows an unlimited amount of defined "Restricted Payments," which include cash dividends and share repurchases, provided our pro forma leverage ratio is equal to or less than 2.50 to 1.00. If our pro forma leverage ratio is greater than 2.50 to 1.00, the credit facility allows such payments up to $100 million per annum (subject to a cap of $300 million for the term of the facility, with up to $25 million of any unused amount of the $100 million per annum base available for use in the next succeeding calendar year). Borrowings under the credit facility bear interest at LIBOR plus an interest margin. The applicable interest margin is based on our leverage ratio. Based on our current leverage ratio, any new borrowings will bear interest at LIBOR plus 1.50%. The interest rate on any borrowings increases to LIBOR plus 1.75% if our leverage ratio is between 1.50 to 1 and 2.50 to 1 and further increases to 2.00% if our leverage ratio equals or exceeds 2.50 to 1. We also pay a commitment fee, also based on our leverage ratio, on undrawn amounts. The undrawn commitment fee, based on our current leverage ratio, is 0.25% per annum. Such undrawn commitment fee increases to 0.30% per annum if our leverage ratio is between 1.50 to 1 and 2.50 to 1 and further increases to 0.35% per annum if our leverage ratio equals or exceeds 2.50 to 1. The borrowings under the credit facility are secured by a lien on substantially all assets, including accounts receivable, inventory, machinery and equipment, and general intangibles (but excluding real estate, intellectual property registered or licensed solely for use in, or arising solely under the laws of, any country other than the United States, assets located solely outside of the United States and deposit and securities accounts), of Vishay and certain significant subsidiaries located in the United States, and pledges of stock in certain significant domestic and foreign subsidiaries; and are guaranteed by certain significant subsidiaries. During the first fiscal quarter of 2021, we redeemed the remaining $0.3 million principal amount of convertible senior debentures due 2041 for $0.3 million. We have no remaining convertible senior debentures. As of April 3, 2021, substantially all of our cash and cash equivalents and short-term investment were held in countries outside of the United States. Our substantially undrawn credit facility provides us with significant operating liquidity in the United States. We expect, at least initially, to fund any future repurchases of convertible debt instruments, as well as other obligations required to be paid by the U.S. parent company, Vishay Intertechnology, Inc., including cash dividends to stockholders, share repurchases, and principal and interest payments on our debt instruments by borrowing under our revolving credit facility. Our U.S. subsidiaries also have operating cash needs. Management expects to use the credit facility from time-to-time to meet certain short-term financing needs. We expect that cash on-hand and cash flows from operations will be sufficient to meet our longer-term financing needs related to normal operating requirements, regular dividend payments, and our research and development and capital expenditure plans. Additional acquisition activity, share repurchases, convertible debt repurchases, or conversion of our convertible debt may require additional borrowing under our credit facility or may otherwise require us to incur additional debt. No principal payments on our debt are due before 2025 and our revolving credit facility expires in June 2024. The convertible senior notes due 2025 are not currently convertible. Pursuant to the indenture governing the convertible senior notes due 2025 and the amendments thereto incorporated in the Supplemental Indenture dated December 23, 2020, we will cash-settle the principal amount of $1,000 per note and settle any additional amounts in shares of our common stock. We intend to finance the principal amount of any converted notes using borrowings under our credit facility. No conversions have occurred to date. 43 We invest a portion of our excess cash in highly liquid, high-quality instruments with maturities greater than 90 days, but less than 1 year, which we classify as short-term investments on our consolidated balance sheets. As these investments were funded using a portion of excess cash and represent a significant aspect of our cash management strategy, we include the investments in the calculation of net cash and short-term investments (debt). The interest rates on our short-term investments vary by location. The average interest rate on our short-term investments was 0.1% due to the negative interest rate environment in Europe and the low interest rate environment in the U.S. Transactions related to these investments are classified as investing activities on our consolidated condensed statements of cash flows. The amount of short-term investments at April 3, 2021 is lower than normal due to the recently completed cash repatriation activity. The following table summarizes the components of net cash and short-term investments (debt) at April 3, 2021 and December 31, 2020 (in thousands) : April 3, 2021 December 31, 2020 Credit facility $ - $ - Convertible senior notes, due 2025* 465,344 406,268 Convertible senior debentures, due 2040* - 130 Deferred financing costs (12,131 ) (11,512 ) Total debt 453,213 394,886 Cash and cash equivalents 643,847 619,874 Short-term investments 137,348 158,476 Net cash and short-term investments (debt) $ 327,982 $ 383,464 *Represents the carrying amount of the convertible instruments, which was significantly impacted by the adoption of ASU No. 2020-06. See Notes 1 and 5 to the consolidated condensed financial statements. "Net cash and short-term investments (debt)" does not have a uniform definition and is not recognized in accordance with GAAP. This measure should not be viewed as an alternative to GAAP measures of performance or liquidity. However, management believes that an analysis of "net cash and short-term investments (debt)" assists investors in understanding aspects of our cash and debt management. The measure, as calculated by us, may not be comparable to similarly titled measures used by other companies. Our financial condition as of April 3, 2021 continued to be strong, with no change to the current ratio (current assets to current liabilities) of 3.0 to 1 from December 31, 2020. The increases in accounts receivable and inventory were offset by increases in trade accounts payable and accrued expenses. Our ratio of total debt to Vishay stockholders' equity was 0.29 to 1 at April 3, 2021, as compared to 0.25 to 1 at December 31, 2020. The increase in the ratio is primarily due to the increase in the carrying value of our long-term debt upon the adoption of ASU No. 2020-06. See Notes 1 and 5 to the consolidated condensed financial statements. Cash flows provided by operating activities were $57.3 million for the three fiscal months ended April 3, 2021, as compared to cash flows provided by operations of $34.5 million for the three fiscal months ended April 4, 2020. Cash paid for property and equipment for the three fiscal months ended April 3, 2021 was $ 28.5 million, as compared to $ 24.3 million for the three fiscal months ended April 4, 2020 . To be well positioned to service our customers and to fully participate in growing markets, we intend to increase our capital expenditures for expansion in the mid-term. For the year 2021, we expect to invest approximately $225 million in capital expenditures. Cash paid for dividends to our common and Class B common stockholders totalled $13.8 million and $13.7 million for the three fiscal months ended April 3, 2021 and April 4, 2020, respectively. We expect dividend payments in 2021 to total approximately $55.0 million. However, any future dividend declaration and payment remains subject to authorization by our Board of Directors. 44 Safe Harbor Statement From time to time, information provided by us, including but not limited to statements in this report, or other statements made by or on our behalf, may contain “forward-looking” information within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “estimate,” “will be,” “will,” “would,” “expect,” “anticipate,” “plan,” “project,” “intend,” “could,” “should,” or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties, and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated, or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; manufacturing or supply chain interruptions or changes in customer demand because of COVID-19; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in applicable domestic and foreign tax regulations and uncertainty regarding the same; changes in U.S. and foreign trade regulations and tariffs and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations, markets, capacity to meet demand, products, services, and prices that are set forth in our filings with the SEC, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Our 2020 Annual Report on Form 10-K listed various important factors that could cause actual results to differ materially from projected and historic results. We note these factors for investors as permitted by the Private Securities Litigation Reform Act of 1995. Readers can find them in Part I, Item 1A, of that filing under the heading “Risk Factors.” You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.