Vicor Reports Broad-Based Financial Improvements

February 09, 2006 by Jeff Shepard

Vicor Corp. announced improvements in revenue, net income, gross margin, book-to-bill ratios and other areas in the just-ended fiscal period. Revenues for the fourth quarter ended December 31, 2005 increased 14% to $46,294,000 compared to $40,637,000 for the corresponding period a year ago. Net income for Q4 was $2,080,000, or $.05 per diluted share compared to a net loss of $2,022,000, or ($.05) per diluted share, in Q4 2004.

For the year ended December 31, 2005 revenues increased 4.5% to $179,351,000 from $171,580,000 for the same period of 2004. Vicor reported net income for the period of $3,916,000, or $.09 per diluted share compared to a net loss of $3,723,000 or ($.09) per diluted share in 2004.

Gross margin improved to 42.7% in Q4 from 36.1% in Q4 2004 and to 39.8% in 2005 from 36.9% in 2004. The book-to-bill ratio for Q4 was 0.95:1 as compared to 0.94:1 in Q4 2004. For 2005 the book-to-bill ratio was 1.01:1 as compared to 1.00:1 in 2004. Backlog at the end of 2005 was $38.6 million as compared to $36.3 million at the end of 2004.

Commenting on the quarter and 2005, Vicor's CEO Patrizio Vinciarelli noted: "As with 2004, 2005 productivity improvements yielded a pattern of expanding margins. While orders in Q4 were seasonally slow, the overall level of demand has been relatively strong. Subject to continuing demand and productivity improvements, we expect revenue growth and steady incremental quarterly expansion of margins to enable substantial profits in 2006."

"While revenues and profitability in our legacy brick business are improving, the V-I Chip and Picor business units are entering their next phase with product roadmaps that support significant penetration of new markets. V-I Chips have completed customer qualification and a production ramp is due to start in Q2," Vinciarelli stated. "We anticipate that the 2nd half of '06 will see tangible V-I Chip revenues from initial programs in volume production and that 2007 will see further expansion driven by additional, major programs."

"In an industry being commoditized by excessive reliance on antiquated power topologies and distribution architectures, our strategy -- leveraging innovative power components, proprietary conversion engines and a more efficient distribution architecture -- is sound. With a business model for profitable growth and heightened focus on operational excellence, we are poised to enable widespread adoption of V-I Chips and factorized power systems," concluded Vinciarelli.