10-Q 1 vishayintertech_10q.htm QUARTERLY REPORT
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 4, 2015

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______
Commission File Number 1-7416
VISHAY INTERTECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)

Delaware |  | 38-1686453
(State or Other Jurisdiction of Incorporation) |  | (I.R.S. Employer Identification Number)
63 Lancaster Avenue Malvern, PA 19355-2143 |  | 610-644-1300
(Address of Principal Executive Offices) |  | (Registrant's Area Code and Telephone Number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ý Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.
ýYes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

| Large accelerated filer ý | Accelerated filer ☐
| Non-accelerated filer ☐ (Do not check if smaller reporting company) | Smaller reporting company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
☐ Yes ý No
As of May 1, 2015, the registrant had 135,440,811 shares of its common stock and 12,129,227 shares of its Class B common stock outstanding.
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VISHAY INTERTECHNOLOGY, INC.
FORM 10-Q
April 4, 2015
CONTENTS

|  |  |  | Page Number
PART I. | FINANCIAL INFORMATION |  |
| Item 1. | Financial Statements |  |
|  | Consolidated Condensed Balance Sheets – April 4, 2015 (Unaudited) and December 31, 2014 |  | 4
|  | Consolidated Condensed Statements of Operations (Unaudited) – Fiscal Quarters Ended April 4, 2015 and March 29, 2014 |  | 6
|  | Consolidated Condensed Statements of Comprehensive Income (Unaudited) – Fiscal Quarters Ended April 4, 2015 and March 29, 2014 |  | 7
|  | Consolidated Condensed Statements of Cash Flows (Unaudited) – Fiscal Quarters Ended April 4, 2015 and March 29, 2014 |  | 8
|  | Consolidated Condensed Statement of Equity (Unaudited) |  | 9
|  | Notes to Consolidated Condensed Financial Statements (Unaudited) |  | 10
| Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations |  | 27
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk |  | 48
| Item 4. | Controls and Procedures |  | 48
PART II. | OTHER INFORMATION |  |
| Item 1. | Legal Proceedings |  | 49
| Item 1A. | Risk Factors |  | 49
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |  | 49
| Item 3. | Defaults Upon Senior Securities |  | 49
| Item 4. | Mine Safety Disclosures |  | 49
| Item 5. | Other Information |  | 49
| Item 6. | Exhibits |  | 50
|  | SIGNATURES |  | 51

3

PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)

|  | April 4, 2015 |  |  | December 31, 2014 |
|  | (Unaudited) |  |  |  |
Assets |  |  |  |  |  |
Current assets: |  |  |  |  |  |
Cash and cash equivalents |  | $ | 517,002 |  |  | $ | 592,172 |
Short-term investments |  |  | 539,046 |  |  |  | 514,776 |
Accounts receivable, net |  |  | 288,273 |  |  |  | 271,554 |
Inventories: |  |  |  |  |  |  |  |
Finished goods |  |  | 115,547 |  |  |  | 113,361 |
Work in process |  |  | 186,758 |  |  |  | 185,769 |
Raw materials |  |  | 124,799 |  |  |  | 125,464 |
Total inventories |  |  | 427,104 |  |  |  | 424,594 |
Deferred income taxes |  |  | 20,415 |  |  |  | 17,815 |
Prepaid expenses and other current assets |  |  | 103,149 |  |  |  | 105,539 |
Total current assets |  |  | 1,894,989 |  |  |  | 1,926,450 |
Property and equipment, at cost: |  |  |  |  |  |  |  |
Land |  |  | 89,594 |  |  |  | 91,844 |
Buildings and improvements |  |  | 547,523 |  |  |  | 560,926 |
Machinery and equipment |  |  | 2,330,646 |  |  |  | 2,368,046 |
Construction in progress |  |  | 65,321 |  |  |  | 82,684 |
Allowance for depreciation |  |  | (2,180,926 | ) |  |  | (2,205,405 | )
|  |  | 852,158 |  |  |  | 898,095 |
Goodwill |  |  | 143,617 |  |  |  | 144,359 |
Other intangible assets, net |  |  | 177,979 |  |  |  | 186,613 |
Other assets |  |  | 143,023 |  |  |  | 143,256 |
Total assets |  | $ | 3,211,766 |  |  | $ | 3,298,773 |

Continues on following page.
4

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)

|  | April 4, 2015 |  |  | December 31, 2014 |
|  | (Unaudited) |  |  |  |
Liabilities and equity |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |
Notes payable to banks |  | $ | 12 |  |  | $ | 18 |
Trade accounts payable |  |  | 156,114 |  |  |  | 174,451 |
Payroll and related expenses |  |  | 115,346 |  |  |  | 120,023 |
Other accrued expenses |  |  | 139,821 |  |  |  | 137,576 |
Income taxes |  |  | 29,927 |  |  |  | 24,671 |
Total current liabilities |  |  | 441,220 |  |  |  | 456,739 |
Long-term debt less current portion |  |  | 470,905 |  |  |  | 454,922 |
Deferred income taxes |  |  | 177,903 |  |  |  | 178,900 |
Other liabilities |  |  | 66,086 |  |  |  | 76,811 |
Accrued pension and other postretirement costs |  |  | 276,626 |  |  |  | 300,524 |
Total liabilities |  |  | 1,432,740 |  |  |  | 1,467,896 |
Stockholders' equity: |  |  |  |  |  |  |  |
Vishay stockholders' equity |  |  |  |  |  |  |  |
Common stock |  |  | 13,544 |  |  |  | 13,532 |
Class B convertible common stock |  |  | 1,213 |  |  |  | 1,213 |
Capital in excess of par value |  |  | 2,055,679 |  |  |  | 2,055,246 |
(Accumulated deficit) retained earnings |  |  | (153,648 | ) |  |  | (175,485 | )
Accumulated other comprehensive income (loss) |  |  | (143,499 | ) |  |  | (69,140 | )
Total Vishay stockholders' equity |  |  | 1,773,289 |  |  |  | 1,825,366 |
Noncontrolling interests |  |  | 5,737 |  |  |  | 5,511 |
Total equity |  |  | 1,779,026 |  |  |  | 1,830,877 |
Total liabilities and equity |  | $ | 3,211,766 |  |  | $ | 3,298,773 |

See accompanying notes.
5

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Operations
(Unaudited - In thousands, except per share amounts)

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Net revenues |  | $ | 593,436 |  |  | $ | 602,378 |
Costs of products sold |  |  | 448,398 |  |  |  | 457,095 |
Gross profit |  |  | 145,038 |  |  |  | 145,283 |
Selling, general, and administrative expenses |  |  | 96,070 |  |  |  | 96,307 |
Restructuring and severance costs |  |  | 1,410 |  |  |  | 6,404 |
Operating income |  |  | 47,558 |  |  |  | 42,572 |
Other income (expense): |  |  |  |  |  |  |  |
Interest expense |  |  | (6,361 | ) |  |  | (5,980 | )
Other |  |  | 3,460 |  |  |  | 1,312 |
|  |  | (2,901 | ) |  |  | (4,668 | )
Income before taxes |  |  | 44,657 |  |  |  | 37,904 |
Income tax expense |  |  | 13,732 |  |  |  | 11,940 |
Net earnings |  |  | 30,925 |  |  |  | 25,964 |
Less: net earnings attributable to noncontrolling interests |  |  | 226 |  |  |  | 154 |
Net earnings attributable to Vishay stockholders |  | $ | 30,699 |  |  | $ | 25,810 |
Basic earnings per share attributable to Vishay stockholders |  | $ | 0.21 |  |  | $ | 0.17 |
Diluted earnings per share attributable to Vishay stockholders |  | $ | 0.20 |  |  | $ | 0.17 |
Weighted average shares outstanding - basic |  |  | 147,698 |  |  |  | 147,557 |
Weighted average shares outstanding - diluted |  |  | 152,666 |  |  |  | 152,556 |
Cash dividends per share |  | $ | 0.06 |  |  | $ | 0.06 |

See accompanying notes.
6

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Comprehensive Income
(Unaudited - In thousands)

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Net earnings |  | $ | 30,925 |  |  | $ | 25,964 |
Other comprehensive income (loss), net of tax |  |  |  |  |  |  |  |
Foreign currency translation adjustment |  |  | (76,318 | ) |  |  | (960 | )
Pension and other post-retirement actuarial items |  |  | 2,113 |  |  |  | 1,503 |
Unrealized gain (loss) on available-for-sale securities |  |  | (154 | ) |  |  | 528 |
Other comprehensive income (loss) |  |  | (74,359 | ) |  |  | 1,071 |
Comprehensive income (loss) |  |  | (43,434 | ) |  |  | 27,035 |
Less: comprehensive income attributable to noncontrolling interests |  |  | 226 |  |  |  | 154 |
Comprehensive income (loss) attributable to Vishay stockholders |  | $ | (43,660 | ) |  | $ | 26,881 |

See accompanying notes.
7

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(Unaudited - In thousands)

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Operating activities |  |  |  |  |  |
Net earnings |  | $ | 30,925 |  |  | $ | 25,964 |
Adjustments to reconcile net earnings to net cash provided by operating activities: |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | 45,410 |  |  |  | 43,355 |
(Gain) loss on disposal of property and equipment |  |  | (83 | ) |  |  | (60 | )
Accretion of interest on convertible debentures |  |  | 1,036 |  |  |  | 958 |
Inventory write-offs for obsolescence |  |  | 4,854 |  |  |  | 4,516 |
Other |  |  | (7,080 | ) |  |  | 1,804 |
Net change in operating assets and liabilities, net of effects of businesses acquired |  |  | (61,564 | ) |  |  | (46,583 | )
Net cash provided by operating activities |  |  | 13,498 |  |  |  | 29,954 |
Investing activities |  |  |  |  |  |  |  |
Capital expenditures |  |  | (19,782 | ) |  |  | (19,347 | )
Proceeds from sale of property and equipment |  |  | 719 |  |  |  | 1,197 |
Purchase of short-term investments |  |  | (78,905 | ) |  |  | (28,423 | )
Maturity of short-term investments |  |  | 17,414 |  |  |  | 50,400 |
Sale of short-term investments |  |  | 503 |  |  |  | - |
Sale of other investments |  |  | 400 |  |  |  | - |
Other investing activities |  |  | 977 |  |  |  | 459 |
Net cash provided by (used in) investing activities |  |  | (78,674 | ) |  |  | 4,286 |
Financing activities |  |  |  |  |  |  |  |
Principal payments on long-term debt and capital leases |  |  | - |  |  |  | (7 | )
Net proceeds on revolving credit lines |  |  | 15,000 |  |  |  | (4,000 | )
Net changes in short-term borrowings |  |  | (6 | ) |  |  | 20 |
Dividends paid to common stockholders |  |  | (8,126 | ) |  |  | (8,119 | )
Dividends paid to Class B common stockholders |  |  | (728 | ) |  |  | (728 | )
Excess tax benefit from RSUs vested |  |  | 21 |  |  |  | - |
Distributions to noncontrolling interests |  |  | - |  |  |  | (300 | )
Net cash provided by (used in) financing activities |  |  | 6,161 |  |  |  | (13,134 | )
Effect of exchange rate changes on cash and cash equivalents |  |  | (16,155 | ) |  |  | 3 |
Net increase (decrease) in cash and cash equivalents |  |  | (75,170 | ) |  |  | 21,109 |
Cash and cash equivalents at beginning of period |  |  | 592,172 |  |  |  | 640,348 |
Cash and cash equivalents at end of period |  | $ | 517,002 |  |  | $ | 661,457 |

See accompanying notes.
8

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statement of Equity
(Unaudited - In thousands, except share amounts)

|  | Common Stock |  |  | Class B Convertible Common Stock |  |  | Capital in Excess of Par Value |  |  | Retained Earnings (Accumulated Deficit) |  |  | Accumulated Other Comprehensive Income (Loss) |  |  | Total Vishay Stockholders' Equity |  |  | Noncontrolling Interests |  |  | Total Equity |
Balance at January 1, 2015 |  | $ | 13,532 |  |  | $ | 1,213 |  |  | $ | 2,055,246 |  |  | $ | (175,485 | ) |  | $ | (69,140 | ) |  | $ | 1,825,366 |  |  | $ | 5,511 |  |  | $ | 1,830,877 |
Net earnings |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 30,699 |  |  |  | - |  |  |  | 30,699 |  |  |  | 226 |  |  |  | 30,925 |
Other comprehensive loss |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (74,359 | ) |  |  | (74,359 | ) |  |  | - |  |  |  | (74,359 | )
Restricted stock issuances (116,498 shares) |  |  | 12 |  |  |  | - |  |  |  | (651 | ) |  |  | - |  |  |  | - |  |  |  | (639 | ) |  |  | - |  |  |  | (639 | )
Dividends declared ($ 0.06 per share) |  |  | - |  |  |  | - |  |  |  | 8 |  |  |  | (8,862 | ) |  |  | - |  |  |  | (8,854 | ) |  |  | - |  |  |  | (8,854 | )
Stock compensation expense |  |  | - |  |  |  | - |  |  |  | 1,055 |  |  |  | - |  |  |  | - |  |  |  | 1,055 |  |  |  | - |  |  |  | 1,055 |
Tax effects of stock plan |  |  | - |  |  |  | - |  |  |  | 21 |  |  |  | - |  |  |  | - |  |  |  | 21 |  |  |  | - |  |  |  | 21 |
Balance at April 4, 2015 |  | $ | 13,544 |  |  | $ | 1,213 |  |  | $ | 2,055,679 |  |  | $ | (153,648 | ) |  | $ | (143,499 | ) |  | $ | 1,773,289 |  |  | $ | 5,737 |  |  | $ | 1,779,026 |

See accompanying notes.
9

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 1 – Basis of Presentation
The accompanying unaudited consolidated condensed financial statements of Vishay Intertechnology, Inc. ("Vishay" or the "Company") have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for presentation of financial position, results of operations, and cash flows required by accounting principles generally accepted in the United States ("GAAP") for complete financial statements. The information furnished reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair summary of the financial position, results of operations, and cash flows for the interim periods presented. The financial statements should be read in conjunction with the consolidated financial statements filed with the Company's Annual Report on Form 10-K for the year ended December 31, 2014. The results of operations for the fiscal quarter ended April 4, 2015 are not necessarily indicative of the results to be expected for the full year.
The Company reports interim financial information for 13-week periods beginning on a Sunday and ending on a Saturday, except for the first fiscal quarter, which always begins on January 1, and the fourth fiscal quarter, which always ends on December 31. The four fiscal quarters in 2015 end on April 4, 2015, July 4, 2015, October 3, 2015, and December 31, 2015, respectively. The four fiscal quarters in 2014 ended on March 29, 2014, June 28, 2014, September 27, 2014, and December 31, 2014, respectively.
Recently Issued Accounting Guidance
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606). The ASU is the result of a convergence project between the FASB and the International Accounting Standards Board to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and International Financial Reporting Standards. The ASU removes inconsistencies and weaknesses in revenue requirements; provides a more robust framework for addressing revenue issues; improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets; provides more useful information to users of financial statements through expanded disclosure requirements; and simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The ASU is effective for the Company for interim and annual periods beginning after January 1, 2017, although a deferral has been recommended by the FASB Staff. Vishay is currently evaluating the effect of the ASU on its revenue contracts and its adoption alternatives.
In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU is the result of the FASB's simplification initiative intended to improve U.S. GAAP by reducing costs and complexity while maintaining or enhancing the usefulness of related financial statement information. The ASU specifies that debt issuance costs related to a note shall be reported in the balance sheet as a direct reduction from the face amount of the note. The ASU is effective for the Company for interim and annual periods beginning after January 1, 2016. The ASU will require the Company to reclassify its capitalized debt issuance costs currently recorded as assets on the consolidated condensed balance sheets. The ASU will have no effect on the Company's results of operations or liquidity.
10

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 2 – Restructuring and Related Activities
The Company places a strong emphasis on controlling its costs.
Historically, the Company's primary cost reduction technique was through the transfer of production to the extent possible from high-labor-cost countries, such as the United States and Western Europe, to lower-labor-cost countries, such as the Czech Republic, Hungary, Israel, India, Malaysia, Mexico, the People's Republic of China, and the Philippines. Between 2001 and 2009, the Company recorded, in the consolidated statements of operations, restructuring and severance costs and related asset write-downs in order to reduce its cost structure going forward.
The Company also incurred significant costs to restructure and integrate acquired businesses, which were included in the cost of the acquisitions under then-applicable GAAP.
The Company did not initiate any new restructuring projects in the years ended December 31, 2012, 2011, or 2010.
On October 28, 2013, the Company announced various cost reduction programs as part of its continuous efforts to improve efficiency and operating performance. The cash costs of these programs, primarily severance, are expected to be approximately $32,000. Complete implementation of all of the programs is expected to occur before the end of the first fiscal quarter of 2016. Many of the severance costs will be recognized ratably over the required stay periods.
The following table summarizes restructuring and related expenses which were recognized and reported on a separate line in the accompanying consolidated statements of operations:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
MOSFETs Enhanced Competitiveness Program |  | $ | 1,353 |  |  | $ | 1,727 |
Voluntary Separation / Retirement Program |  |  | 57 |  |  |  | 4,677 |
Modules Production Transfer Program |  |  | - |  |  |  | - |
Total |  | $ | 1,410 |  |  | $ | 6,404 |

MOSFETs Enhanced Competitiveness Program
Over a period of approximately 2 years and in a series of discrete steps, the manufacture of wafers for a substantial share of products will be transferred into a more cost-efficient fab. As a consequence, certain other manufacturing currently occurring in-house will be transferred to third-party foundries.
The total severance costs associated with these initiatives are expected to be approximately $16,000. Employees generally must remain with the Company during the production transfer period. Accordingly, the Company will accrue these severance costs ratably over the respective employees' remaining service periods.
The following table summarizes the activity to date related to this program:

Expense recorded in 2013 |  | $ | 2,328 |
Cash paid |  |  | (267 | )
Balance at December 31, 2013 |  | $ | 2,061 |
Expense recorded in 2014 |  |  | 6,025 |
Cash paid |  |  | (856 | )
Balance at December 31, 2014 |  | $ | 7,230 |
Expense recorded in 2015 |  |  | 1,353 |
Cash paid |  |  | (388 | )
Balance at April 4, 2015 |  | $ | 8,195 |

Severance benefits are generally paid in a lump sum at cessation of employment. The entire amount of the liability is considered current and is included in other accrued expenses in the accompanying consolidated condensed balance sheets.
11

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Voluntary Separation / Retirement Program
The voluntary separation / early retirement program was offered to employees worldwide who were eligible because they met job classification, age, and years-of-service criteria as of October 31, 2013. The program benefits vary by country and job classification, but generally include a cash loyalty bonus based on years of service. All employees eligible for the program have been identified, and have left or will leave the Company after the expiration of their respective transition periods.
These employees generally were not aligned with any particular segment. The effective separation / retirement date for most employees who accepted the offer was June 30, 2014 or earlier, with a few exceptions to allow for a transition period.
The following table summarizes the activity to date related to this program:

Expense recorded in 2013 |  | $ | 486 |
Cash paid |  |  | (98 | )
Foreign currency translation |  |  | 3 |
Balance at December 31, 2013 |  | $ | 391 |
Expense recorded in 2014 |  |  | 12,792 |
Cash paid |  |  | (8,054 | )
Foreign currency translation |  |  | (455 | )
Balance at December 31, 2014 |  | $ | 4,674 |
Expense recorded in 2015 |  |  | 57 |
Cash paid |  |  | (1,216 | )
Foreign currency translation |  |  | (286 | )
Balance at April 4, 2015 |  | $ | 3,229 |

The payment terms vary by country, but generally are paid in a lump sum at cessation of employment. Certain participants are being paid in installments. The entire amount of the liability is considered current and is included in other accrued expenses in the accompanying consolidated balance sheets.
Modules Production Transfer
In an effort to reduce costs and streamline production of its module products within its Diodes segment, the Company committed to two smaller cost reduction programs related to the transferring of production of certain of its products.
The following table summarizes the activity to date related to this program:

Expense recorded in 2014 |  | $ | 2,080 |
Cash paid |  |  | (464 | )
Foreign currency translation |  |  | (121 | )
Balance at December 31, 2014 |  | $ | 1,495 |
Cash paid |  |  | (525 | )
Foreign currency translation |  |  | (128 | )
Balance at April 4, 2015 |  | $ | 842 |

Severance benefits are generally paid in a lump sum at cessation of employment. The entire amount of the liability is considered current and is included in other accrued expenses in the accompanying consolidated condensed balance sheets.
12

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 3 – Income Taxes
The provision for income taxes consists of provisions for federal, state, and foreign income taxes. The effective tax rates for the periods ended April 4, 2015 and March 29, 2014 reflect the Company's expected tax rate on reported income from continuing operations before income tax and tax adjustments. The Company operates in a global environment with significant operations in various jurisdictions outside the United States. Accordingly, the consolidated income tax rate is a composite rate reflecting the Company's earnings and the applicable tax rates in the various jurisdictions where the Company operates.
During the three fiscal months ended April 4, 2015, the liabilities for unrecognized tax benefits decreased by $754 on a net basis, principally due to currency effects.
During 2014, the Company borrowed $53,000 on its revolving credit facility to achieve future flexibility given the legal entity and the financial structure utilized for the Capella Microsystems Inc. ("Capella") acquisition. Subsequent to the acquisition of the noncontrolling interests in Capella on December 31, 2014, the Company expects to repatriate cash from the 2014 earnings of non-U.S. subsidiaries to the United States primarily to repay those borrowings on the revolving credit facility, and also to realign the acquired entity structure to have Capella's U.S. subsidiary directly owned by Vishay Intertechnology, Inc. The tax provision for the year ended December 31, 2014 included all U.S. federal and state income taxes, incremental foreign income taxes, and withholding taxes payable related to that anticipated repatriation transaction. The repatriation is anticipated in the second fiscal quarter of 2015, pending completion of statutory audits of certain subsidiaries required to distribute earnings.
13

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 4 – Long-Term Debt
Long-term debt consists of the following:

|  | April 4, 2015 |  |  | December 31, 2014 |
Credit facility |  | $ | 215,000 |  |  | $ | 200,000 |
Exchangeable unsecured notes, due 2102 |  |  | 38,642 |  |  |  | 38,642 |
Convertible senior debentures, due 2040 |  |  | 104,297 |  |  |  | 103,841 |
Convertible senior debentures, due 2041 |  |  | 53,523 |  |  |  | 53,249 |
Convertible senior debentures, due 2042 |  |  | 59,443 |  |  |  | 59,190 |
|  |  | 470,905 |  |  |  | 454,922 |
Less current portion |  |  | - |  |  |  | - |
|  | $ | 470,905 |  |  | $ | 454,922 |

Convertible Senior Debentures
Vishay currently has three issuances of convertible senior debentures outstanding with generally congruent terms. The quarterly cash dividend program of the Company results in adjustments to the conversion rate and effective conversion price for each issuance of the Company's convertible senior debentures effective as of the ex-dividend date of each cash dividend.
The following table summarizes some key facts and terms regarding the three series of outstanding convertible senior debentures following the adjustment made to the conversion rate of the debentures on the ex-dividend date of the March 25, 2015 dividend payment:

|  | Due 2040 |  |  | Due 2041 |  |  | Due 2042 |
Issuance date |  | November 9, 2010 |  |  | May 13, 2011 |  |  | May 31, 2012 |
Maturity date |  | November 15, 2040 |  |  | May 15, 2041 |  |  | June 1, 2042 |
Principal amount |  | $ | 275,000 |  |  | $ | 150,000 |  |  | $ | 150,000 |
Cash coupon rate (per annum) |  |  | 2.25 | % |  |  | 2.25 | % |  |  | 2.25 | %
Nonconvertible debt borrowing rate at issuance (per annum) |  |  | 8.00 | % |  |  | 8.375 | % |  |  | 7.50 | %
Conversion rate effective March 10, 2015 (per $1 principal amount) |  |  | 73.5289 |  |  |  | 53.6575 |  |  |  | 86.4524 |
Effective conversion price effective March 10, 2015 (per share) |  | $ | 13.60 |  |  | $ | 18.64 |  |  | $ | 11.57 |
130% of the conversion price (per share) |  | $ | 17.68 |  |  | $ | 24.23 |  |  | $ | 15.04 |
Call date |  | November 20, 2020 |  |  | May 20, 2021 |  |  | June 7, 2022 |

Prior to three months before the maturity date, the holders may only convert their debentures under the following circumstances: (1) during any fiscal quarter after the first full quarter subsequent to issuance, if the sale price of Vishay common stock reaches 130% of the conversion price for a specified period; (2) the trading price of the debentures falls below 98% of the product of the sale price of Vishay's common stock and the conversion rate for a specified period; (3) Vishay calls any or all of the debentures for redemption, at any time prior to the close of business on the third scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events.
Based on an evaluation of the conversion criteria at April 4, 2015 and December 31, 2014, none of the convertible senior debentures due 2040, due 2041, or due 2042 were convertible. The conversion criteria of the debentures will continue to be evaluated and the debentures may become convertible in the future. At the direction of the Company's Board of Directors, the Company intends, upon conversion, to repay the principal amount of the convertible debentures in cash and settle any additional amounts in shares of the Company's common stock. The Company intends to finance the principal amount of any converted debentures using borrowings under its credit facility.
14

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
GAAP requires an issuer to separately account for the liability and equity components of the instrument in a manner that reflects the issuer's nonconvertible debt borrowing rate when interest costs are recognized in subsequent periods. The resulting discount on the debt is amortized as non-cash interest expense in future periods.
The carrying values of the liability and equity components of the convertible debentures are reflected in the Company's consolidated condensed balance sheets as follows:

|  | Principal amount of the debentures |  |  | Unamortized discount |  |  | Embedded derivative |  |  | Carrying value of liability component |  |  | Equity component - net carrying value |
April 4, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Due 2040 |  | $ | 275,000 |  |  |  | (171,170 | ) |  |  | 467 |  |  | $ | 104,297 |  |  | $ | 110,094 |
Due 2041 |  | $ | 150,000 |  |  |  | (96,831 | ) |  |  | 354 |  |  | $ | 53,523 |  |  | $ | 62,246 |
Due 2042 |  | $ | 150,000 |  |  |  | (90,788 | ) |  |  | 231 |  |  | $ | 59,443 |  |  | $ | 57,874 |
Total |  | $ | 575,000 |  |  | $ | (358,789 | ) |  | $ | 1,052 |  |  | $ | 217,263 |  |  | $ | 230,214 |
December 31, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Due 2040 |  | $ | 275,000 |  |  |  | (171,685 | ) |  |  | 526 |  |  | $ | 103,841 |  |  | $ | 110,094 |
Due 2041 |  | $ | 150,000 |  |  |  | (97,092 | ) |  |  | 341 |  |  | $ | 53,249 |  |  | $ | 62,246 |
Due 2042 |  | $ | 150,000 |  |  |  | (91,048 | ) |  |  | 238 |  |  | $ | 59,190 |  |  | $ | 57,874 |
Total |  | $ | 575,000 |  |  | $ | (359,825 | ) |  | $ | 1,105 |  |  | $ | 216,280 |  |  | $ | 230,214 |

Interest is payable on the debentures semi-annually at the cash coupon rate; however, the remaining debt discount is being amortized as additional non-cash interest expense using an effective annual interest rate equal to the Company's estimated nonconvertible debt borrowing rate at the time of issuance. In addition to ordinary interest, contingent interest will accrue in certain circumstances relating to the trading price of the debentures and under certain other circumstances beginning ten years subsequent to issuance.
Interest expense related to the debentures is reflected on the consolidated condensed statements of operations for the fiscal quarters ended:

|  | Contractual coupon interest |  |  | Non-cash amortization of debt discount |  |  | Non-cash amortization of deferred financing costs |  |  | Non-cash change in value of derivative liability |  |  | Total interest expense related to the debentures |
April 4, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Due 2040 |  | $ | 1,547 |  |  |  | 515 |  |  |  | 22 |  |  |  | (59 | ) |  | $ | 2,025 |
Due 2041 |  | $ | 844 |  |  |  | 261 |  |  |  | 12 |  |  |  | 13 |  |  | $ | 1,130 |
Due 2042 |  | $ | 844 |  |  |  | 260 |  |  |  | 13 |  |  |  | (7 | ) |  | $ | 1,110 |
Total |  | $ | 3,235 |  |  | $ | 1,036 |  |  | $ | 47 |  |  | $ | (53 | ) |  | $ | 4,265 |
March 29, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Due 2040 |  | $ | 1,547 |  |  |  | 476 |  |  |  | 22 |  |  |  | 45 |  |  | $ | 2,090 |
Due 2041 |  | $ | 844 |  |  |  | 241 |  |  |  | 11 |  |  |  | 14 |  |  | $ | 1,110 |
Due 2042 |  | $ | 844 |  |  |  | 241 |  |  |  | 13 |  |  |  | 20 |  |  | $ | 1,118 |
Total |  | $ | 3,235 |  |  | $ | 958 |  |  | $ | 46 |  |  | $ | 79 |  |  | $ | 4,318 |

15

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 5 – Accumulated Other Comprehensive Income (Loss)
The cumulative balance of each component of other comprehensive income (loss) and the income tax effects allocated to each component are as follows:

|  | Pension and other post-retirement actuarial items |  |  | Currency translation adjustment |  |  | Unrealized gain (loss) on available-for-sale securities |  |  | Total |
Balance at January 1, 2015 |  | $ | (155,760 | ) |  | $ | 84,703 |  |  | $ | 1,917 |  |  | $ | (69,140 | )
Other comprehensive income (loss) before reclassifications |  |  | - |  |  |  | (76,318 | ) |  |  | 443 |  |  | $ | (75,875 | )
Tax effect |  |  | - |  |  |  | - |  |  |  | (155 | ) |  | $ | (155 | )
Other comprehensive income (loss) before reclassifications, net of tax |  |  | - |  |  |  | (76,318 | ) |  |  | 288 |  |  | $ | (76,030 | )
Amounts reclassified out of AOCI |  |  | 3,169 |  |  |  | - |  |  |  | (680 | ) |  | $ | 2,489 |
Tax effect |  |  | (1,056 | ) |  |  | - |  |  |  | 238 |  |  | $ | (818 | )
Amounts reclassified out of AOCI, net of tax |  |  | 2,113 |  |  |  | - |  |  |  | (442 | ) |  | $ | 1,671 |
Net other comprehensive income (loss) |  | $ | 2,113 |  |  | $ | (76,318 | ) |  | $ | (154 | ) |  | $ | (74,359 | )
Balance at April 4, 2015 |  | $ | (153,647 | ) |  | $ | 8,385 |  |  | $ | 1,763 |  |  | $ | (143,499 | )

Reclassifications of pension and other post-retirement actuarial items out of AOCI are included in the computation of net periodic benefit cost. (See Note 6 for further information). The amount of unrealized gains (losses) on available-for-sale securities reclassified out of AOCI as a result of sales of securities held by the Company's rabbi trust used to fund a deferred compensation plan was $680 for the fiscal quarter ended April 4, 2015. These reclassifications are recorded as a component of compensation expense within Selling, General, and Administrative expenses on our consolidated condensed statements of operations.
Other comprehensive income (loss) includes Vishay's proportionate share of other comprehensive income (loss) of nonconsolidated subsidiaries accounted for under the equity method.
16

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 6 – Pensions and Other Postretirement Benefits
The Company maintains various retirement benefit plans.
The following table shows the components of the net periodic pension cost for the first fiscal quarters of 2015 and 2014 for the Company's defined benefit pension plans:

|  | Fiscal quarter ended April 4, 2015 |  |  | Fiscal quarter ended March 29, 2014 |
|  | U.S. Plans |  |  | Non-U.S. Plans |  |  | U.S. Plans |  |  | Non-U.S. Plans |
Net service cost |  | $ | - |  |  | $ | 829 |  |  | $ | - |  |  | $ | 824 |
Interest cost |  |  | 2,943 |  |  |  | 1,432 |  |  |  | 3,834 |  |  |  | 2,181 |
Expected return on plan assets |  |  | (3,385 | ) |  |  | (454 | ) |  |  | (4,058 | ) |  |  | (525 | )
Amortization of prior service cost (credit) |  |  | 16 |  |  |  | - |  |  |  | (23 | ) |  |  | 1 |
Amortization of losses |  |  | 2,022 |  |  |  | 1,299 |  |  |  | 1,810 |  |  |  | 687 |
Net periodic benefit cost |  | $ | 1,596 |  |  | $ | 3,106 |  |  | $ | 1,563 |  |  | $ | 3,168 |

The following table shows the components of the net periodic benefit cost for the first fiscal quarters of 2015 and 2014 for the Company's other postretirement benefit plans:

|  | Fiscal quarter ended April 4, 2015 |  |  | Fiscal quarter ended March 29, 2014 |
|  | U.S. Plans |  |  | Non-U.S. Plans |  |  | U.S. Plans |  |  | Non-U.S. Plans |
Service cost |  | $ | 30 |  |  | $ | 69 |  |  | $ | 29 |  |  | $ | 79 |
Interest cost |  |  | 83 |  |  |  | 37 |  |  |  | 88 |  |  |  | 63 |
Amortization of prior service (credit) |  |  | (209 | ) |  |  | - |  |  |  | (206 | ) |  |  | - |
Amortization of losses (gains) |  |  | 22 |  |  |  | 19 |  |  |  | (35 | ) |  |  | 10 |
Net periodic benefit cost |  | $ | (74 | ) |  | $ | 125 |  |  | $ | (124 | ) |  | $ | 152 |

17

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 7 – Stock-Based Compensation
The Company has various stockholder-approved programs which allow for the grant of stock-based compensation to officers, employees, and non-employee directors of the Company.
The amount of compensation cost related to stock-based payment transactions is measured based on the grant-date fair value of the equity instruments issued. The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model. The Company determines compensation cost for restricted stock units ("RSUs"), phantom stock units, and restricted stock based on the grant-date fair value of the underlying common stock adjusted for expected dividends paid over the required vesting period for non-participating awards. Compensation cost is recognized over the period that an officer, employee, or non-employee director provides service in exchange for the award.
The following table summarizes stock-based compensation expense recognized:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Restricted stock units |  | $ | 914 |  |  | $ | 810 |
Phantom stock units |  |  | 141 |  |  |  | 131 |
Stock options |  |  | - |  |  |  | - |
Total |  | $ | 1,055 |  |  | $ | 941 |

The Company recognizes compensation cost for RSUs that are expected to vest and records cumulative adjustments in the period that the expectation changes.
The following table summarizes unrecognized compensation cost and the weighted average remaining amortization periods at April 4, 2015 (amortization periods in years):

|  | Unrecognized Compensation Cost |  |  | Weighted Average Remaining Amortization Periods |
Stock options |  | $ | - |  |  |  | 0.0 |
Restricted stock units |  |  | 10,404 |  |  |  | 1.7 |
Phantom stock units |  |  | - |  |  |  | 0.0 |
Total |  | $ | 10,404 |  |  |  |  |

Unrecognized compensation cost presented in the table above includes $2,935 of unrecognized compensation cost for performance-based RSUs that are not currently expected to vest and for which no compensation cost is currently being recognized.
18

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
2007 Stock Incentive Plan
The Company's 2007 Stock Incentive Program (the "2007 Program"), as amended and restated, permits the grant of up to 6,500,000 shares of restricted stock, unrestricted stock, RSUs, stock options, and phantom stock units, to officers, employees, and non-employee directors of the Company. Such instruments are available for grant until May 20, 2024.
Restricted Stock Units
RSU activity under the 2007 Program as of April 4, 2015 and changes during the three fiscal months then ended are presented below (number of RSUs in thousands):

|  | Number of RSUs |  |  | Weighted Average Grant-date Fair Value per Unit |
Outstanding: |  |  |  |  |  |
January 1, 2015 |  |  | 1,147 |  |  | $ | 12.75 |
Granted |  |  | 349 |  |  |  | 13.60 |
Vested* |  |  | (162 | ) |  |  | 11.34 |
Cancelled or forfeited |  |  | (276 | ) |  |  | 12.88 |
Outstanding at April 4, 2015 |  |  | 1,058 |  |  | $ | 13.21 |
Expected to vest at April 4, 2015 |  |  | 836 |  |  |  |  |

* The number of RSUs vested includes shares that the Company withheld on behalf of employees to satisfy the statutory tax withholding requirements.
The number of performance-based RSUs that are scheduled to vest increases ratably based on the achievement of defined performance criteria between the established target and maximum levels. RSUs with performance-based vesting criteria are expected to vest as follows (number of RSUs in thousands):

Vesting Date |  | Expected to Vest |  |  | Not Expected to Vest |  |  | Total |
January 1, 2016 |  |  | - |  |  |  | 222 |  |  |  | 222 |
January 1, 2017 |  |  | 192 |  |  |  | - |  |  |  | 192 |
January 1, 2018 |  |  | 202 |  |  |  | - |  |  |  | 202 |

Phantom Stock Units
The 2007 Program authorizes the grant of phantom stock units to the extent provided for in the Company's employment agreements with certain executives. Each phantom stock unit entitles the recipient to receive a share of common stock at the individual's termination of employment or any other future date specified in the applicable employment agreement. Phantom stock units participate in dividend distribution on the same basis as the Company's common stock and Class B common stock. Dividend equivalents are issued in the form of additional units of phantom stock. The phantom stock units are fully vested at all times.
Phantom stock unit activity under the phantom stock plan as of April 4, 2015 and changes during the three fiscal months then ended are presented below (number of phantom stock units in thousands):

|  | Number of Units |  |  | Grant-date Fair Value per Unit |
Outstanding: |  |  |  |  |  |
January 1, 2015 |  |  | 119 |  |  |  |
Granted |  |  | 10 |  |  | $ | 14.09 |
Dividend equivalents issued |  |  | 1 |  |  |  |  |
Redeemed for common stock |  |  | - |  |  |  |  |
Outstanding at April 4, 2015 |  |  | 130 |  |  |  |  |

19

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Stock Options
In addition to stock options outstanding pursuant to the 2007 Program, during the periods presented, the Company had stock options outstanding under previous stockholder-approved stock option programs. These programs are more fully described in Note 12 to the Company's consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2014. No additional options may be granted pursuant to these programs.
At December 31, 2014 and April 4, 2015, there were 105 options outstanding with a weighted average exercise price of $15.38. At April 4, 2015, the weighted average remaining contractual life of all outstanding options was 2.08 years.
At April 4, 2015, there were no unvested options outstanding.
The pretax aggregate intrinsic value (the difference between the closing stock price on the last trading day of the first fiscal quarter of 2015 of $13.87 per share and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on April 4, 2015 was $27. This amount changes based on changes in the market value of the Company's common stock. During the three fiscal months ended April 4, 2015, no options were exercised.
20

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 8 – Segment Information
Vishay operates, and its chief operating decision maker makes strategic and operating decisions with regards to assessing performance and allocating resources based on, five reporting segments: MOSFETs, Diodes, Optoelectronic Components, Resistors & Inductors, and Capacitors.
The Company evaluates business segment performance on operating income, exclusive of certain items ("segment operating income"). Only dedicated, direct selling, general, and administrative expenses of the segments are included in the calculation of segment operating income. The Company's calculation of segment operating income excludes such selling, general, and administrative costs as global operations, sales and marketing, information systems, finance and administration groups, as well as restructuring and severance costs, executive compensation charges (credits), material gains and losses on sales of property, and other items. Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to intrinsic operating results of the Company. These items represent reconciling items between segment operating income and consolidated operating income. Business segment assets are the owned or allocated assets used by each business.
The following tables set forth business segment information:

|  | MOSFETs |  |  | Diodes |  |  | Optoelectronic Components |  |  | Resistors & Inductors |  |  | Capacitors |  |  | Total |
Fiscal quarter ended April 4, 2015: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Product Sales |  | $ | 106,759 |  |  | $ | 136,511 |  |  | $ | 68,625 |  |  | $ | 186,392 |  |  | $ | 94,036 |  |  | $ | 592,323 |
Royalty Revenues |  |  | 11 |  |  |  | - |  |  |  | - |  |  |  | 1,102 |  |  |  | - |  |  | $ | 1,113 |
Total Revenue |  | $ | 106,770 |  |  | $ | 136,511 |  |  | $ | 68,625 |  |  | $ | 187,494 |  |  | $ | 94,036 |  |  | $ | 593,436 |
Gross Margin |  | $ | 13,758 |  |  | $ | 29,890 |  |  | $ | 22,183 |  |  | $ | 58,849 |  |  | $ | 20,358 |  |  | $ | 145,038 |
Fiscal quarter ended March 29, 2014: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Product Sales |  | $ | 113,113 |  |  | $ | 136,929 |  |  | $ | 57,498 |  |  | $ | 187,989 |  |  | $ | 105,511 |  |  | $ | 601,040 |
Royalty Revenues |  |  | 28 |  |  |  | - |  |  |  | - |  |  |  | 1,310 |  |  |  | - |  |  | $ | 1,338 |
Total Revenue |  | $ | 113,141 |  |  | $ | 136,929 |  |  | $ | 57,498 |  |  | $ | 189,299 |  |  | $ | 105,511 |  |  | $ | 602,378 |
Gross Margin |  | $ | 12,617 |  |  | $ | 29,765 |  |  | $ | 21,237 |  |  | $ | 60,120 |  |  | $ | 21,544 |  |  | $ | 145,283 |

21

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Operating margin reconciliation: |  |  |  |  |  |
MOSFETs |  | $ | 4,527 |  |  | $ | 2,487 |
Diodes |  |  | 23,485 |  |  |  | 23,058 |
Optoelectronic Components |  |  | 17,087 |  |  |  | 17,404 |
Resistors & Inductors |  |  | 49,525 |  |  |  | 50,336 |
Capacitors |  |  | 14,564 |  |  |  | 15,341 |
Restructuring and Severance Costs |  |  | (1,410 | ) |  |  | (6,404 | )
Unallocated Selling, General, and Administrative Expenses |  |  | (60,220 | ) |  |  | (59,650 | )
Consolidated Operating Income |  | $ | 47,558 |  |  | $ | 42,572 |

22

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 9 – Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share attributable to Vishay stockholders (shares in thousands):

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Numerator: |  |  |  |  |  |
Numerator for basic earnings per share: |  |  |  |  |  |
Net earnings |  | $ | 30,699 |  |  | $ | 25,810 |
Adjustment to the numerator for continuing operations and net earnings: |  |  |  |  |  |  |  |
Interest savings assuming conversion of dilutive convertible and exchangeable notes, net of tax |  |  | 16 |  |  |  | 16 |
Numerator for diluted earnings per share: |  |  |  |  |  |  |  |
Net earnings |  | $ | 30,715 |  |  | $ | 25,826 |
Denominator: |  |  |  |  |  |  |  |
Denominator for basic earnings per share: |  |  |  |  |  |  |  |
Weighted average shares |  |  | 147,569 |  |  |  | 147,440 |
Outstanding phantom stock units |  |  | 129 |  |  |  | 117 |
Adjusted weighted average shares |  |  | 147,698 |  |  |  | 147,557 |
Effect of dilutive securities: |  |  |  |  |  |  |  |
Convertible and exchangeable debt instruments |  |  | 4,778 |  |  |  | 4,782 |
Restricted stock units |  |  | 184 |  |  |  | 210 |
Other |  |  | 6 |  |  |  | 7 |
Dilutive potential common shares |  |  | 4,968 |  |  |  | 4,999 |
Denominator for diluted earnings per share: |  |  |  |  |  |  |  |
Adjusted weighted average shares |  |  | 152,666 |  |  |  | 152,556 |
Basic earnings per share attributable to Vishay stockholders |  | $ | 0.21 |  |  | $ | 0.17 |
Diluted earnings per share attributable to Vishay stockholders |  | $ | 0.20 |  |  | $ | 0.17 |

23

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Diluted earnings per share for the periods presented do not reflect the following weighted average potential common shares that would have an antidilutive effect or have unsatisfied performance conditions (in thousands):

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Convertible and exchangeable notes: |  |  |  |  |  |
Convertible Senior Debentures, due 2041 |  |  | 8,024 |  |  |  | 7,897 |
Weighted average employee stock options |  |  | 77 |  |  |  | 77 |
Weighted average other |  |  | 620 |  |  |  | 710 |

In periods in which they are dilutive, if the potential common shares related to the exchangeable notes are included in the computation, the related interest savings, net of tax, assuming conversion/exchange is added to the net earnings used to compute earnings per share.
The Company's convertible debt instruments are only convertible for specified periods upon the occurrence of certain events. None of the conversion criteria were met for the periods presented. In periods that the debentures are not convertible, the certain conditions which could trigger conversion of the remaining debentures have been deemed to be non-substantive, and accordingly, the Company has always assumed the conversion of these instruments in its diluted earnings per share computation during periods in which they are dilutive.
At the direction of its Board of Directors, the Company intends, upon conversion, to repay the principal amounts of the convertible senior debentures, due 2040, due 2041, and due 2042, in cash and settle any additional amounts in shares of Vishay common stock. Accordingly, the debentures are included in the diluted earnings per share computation using the "treasury stock method" (similar to options and warrants) rather than the "if converted method" otherwise required for convertible debt. Under the "treasury stock method," Vishay calculates the number of shares issuable under the terms of the debentures based on the average market price of Vishay common stock during the period, and that number is included in the total diluted shares figure for the period. If the average market price is less than $13.60, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2040, if the average market price is less than $18.64, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2041, and if the average market price is less than $11.57, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2042.
24

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
Note 10 – Fair Value Measurements
The fair value measurement accounting guidance establishes a valuation hierarchy of the inputs used to measure fair value. This hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:
Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3: Unobservable inputs that reflect the Company's own assumptions.
An asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. There have been no changes in the classification of any financial instruments within the fair value hierarchy in the periods presented.
The following table provides the financial assets and liabilities carried at fair value measured on a recurring basis:

|  | Total Fair Value |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
April 4, 2015: |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Assets held in rabbi trusts |  | $ | 40,411 |  |  | $ | 26,737 |  |  | $ | 13,674 |  |  | $ | - |
Available for sale securities |  | $ | 5,680 |  |  |  | 4,003 |  |  |  | 1,677 |  |  |  | - |
|  | $ | 46,091 |  |  | $ | 30,740 |  |  | $ | 15,351 |  |  | $ | - |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Embedded derivative - convertible debentures due 2040 |  | $ | (467 | ) |  | $ | - |  |  | $ | - |  |  | $ | (467 | )
Embedded derivative - convertible debentures due 2041 |  | $ | (354 | ) |  |  | - |  |  |  | - |  |  |  | (354 | )
Embedded derivative - convertible debentures due 2042 |  | $ | (231 | ) |  |  | - |  |  |  | - |  |  |  | (231 | )
|  | $ | (1,052 | ) |  | $ | - |  |  | $ | - |  |  | $ | (1,052 | )
December 31, 2014: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets held in rabbi trusts |  | $ | 40,270 |  |  | $ | 26,853 |  |  | $ | 13,417 |  |  | $ | - |
Available for sale securities |  | $ | 15,432 |  |  |  | 4,439 |  |  |  | 10,993 |  |  |  | - |
|  | $ | 55,702 |  |  | $ | 31,292 |  |  | $ | 24,410 |  |  | $ | - |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Embedded derivative - convertible debentures due 2040 |  | $ | (526 | ) |  | $ | - |  |  | $ | - |  |  | $ | (526 | )
Embedded derivative - convertible debentures due 2041 |  | $ | (341 | ) |  |  | - |  |  |  | - |  |  |  | (341 | )
Embedded derivative - convertible debentures due 2042 |  | $ | (238 | ) |  |  | - |  |  |  | - |  |  |  | (238 | )
|  | $ | (1,105 | ) |  | $ | - |  |  | $ | - |  |  | $ | (1,105 | )

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 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. The company-owned life insurance assets are valued in consultation with the Company's insurance brokers using the value of underlying assets of the insurance contracts. The fair value measurement of the marketable securities held in the rabbi trust is 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.
25

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)
The Company holds available for sale investments in debt securities that are intended to fund a portion of its pension and other postretirement benefit obligations outside of the United States. The investments are valued based on quoted market prices on the last business day of the year. The fair value measurement of the investments is considered a Level 1 measurement within the fair value hierarchy.
The convertible senior debentures, due 2040, due 2041, and due 2042, issued by the Company on November 9, 2010, May 13, 2011, and May 31, 2012, respectively, contain embedded derivative features that GAAP requires to be bifurcated and remeasured each reporting period. Each quarter, the change in the fair value of the embedded derivative features, if any, is recorded in the consolidated condensed statements of operations. The Company uses a derivative valuation model to derive the value of the embedded derivative features. Key inputs into this valuation model are the Company's current stock price, risk-free interest rates, the stock dividend yield, the stock volatility, and the debentures' credit spread over LIBOR. The first three aforementioned inputs are based on observable market data and are considered Level 2 inputs while the last two aforementioned inputs are unobservable and thus require management's judgment and are considered Level 3 inputs. The fair value measurement is considered a Level 3 measurement within the fair value hierarchy.
In the third fiscal quarter of 2014, the Company entered into forward contracts with a highly-rated financial institution to mitigate the foreign currency risk associated with an intercompany loan denominated in a currency other than the legal entity's functional currency. The notional amount of the forward contract was $14,000 as of April 4, 2015. The intercompany loan was used to finance a portion of the purchase price for Capella. The forward contracts settle monthly and are expected to be renewed at the Company's discretion on a monthly basis until the intercompany loan is repaid. The forward contract was renewed on the last day of the first fiscal quarter. We have not designated the forward contract as a hedge for accounting purposes, and as such the change in the fair value of the contract is recognized in the consolidated condensed statements of operations as a component of other income (expense). The Company estimates the fair value of the forward contract based on applicable and commonly used pricing models using current market information and is considered a Level 2 measurement within the fair value hierachy. Due to the timing of the renewal of the forward contract, the value of the forward contract was immaterial as of April 4, 2015. The Company does not utilize derivatives or other financial instruments for trading or other speculative purposes.
The fair value of the long-term debt, excluding the derivative liabilities, at April 4, 2015 and December 31, 2014 is approximately $860,400 and $853,500, respectively, compared to its carrying value, excluding the derivative liabilities, of $469,853, and $453,817, respectively. The Company estimates the fair value of its long-term debt using a combination of quoted market prices for similar financing arrangements and expected future payments discounted at risk-adjusted rates, which are considered Level 2 inputs.
At April 4, 2015 and December 31, 2014, the Company's short-term investments were comprised of time deposits with financial institutions that have maturities that exceed 90 days from the date of acquisition; however they all mature within one year from the respective balance sheet dates. The short-term investments acquired in the 2014 Capella acquisition are accounted for as available for sale instruments, at fair value. The Company's remaining short-term investments are accounted for as held-to-maturity debt instruments, at amortized cost, which approximates their fair value. The investments are funded with excess cash not expected to be needed for operations prior to maturity; therefore, the Company believes it has the intent and ability to hold the short-term investments until maturity. At each reporting date, the Company performs an evaluation to determine if any unrealized losses are other-than-temporary. No other-than-temporary impairments have been recognized on these securities, and there are no unrecognized holding gains or losses for these securities during the periods presented. There have been no transfers to or from the held-to-maturity classification. All decreases in the account balance are due to returns of principal at the securities' maturity dates. Interest on the securities is recognized as interest income when earned.
At April 4, 2015 and December 31, 2014, the Company's cash and cash equivalents were comprised of demand deposits, time deposits with maturities of three months or less when purchased, and money market funds. The Company estimates the fair value of its cash, cash equivalents, and short-term investments using level 2 inputs. Based on the current interest rates for similar investments with comparable credit risk and time to maturity, the fair value of the Company's cash, cash equivalents, and held-to-maturity short-term investments approximate the carrying amounts reported in the consolidated condensed balance sheets.
The Company's financial instruments also include accounts receivable, short-term notes payable, and accounts payable. The carrying amounts for these financial instruments reported in the consolidated condensed balance sheets approximate their fair values.
26

Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview
Vishay Intertechnology, Inc. ("Vishay," "we," "us," or "our") is a global manufacturer and supplier of discrete semiconductors and passive components, including power MOSFETs, power integrated circuits, transistors, diodes, optoelectronic components, resistors, capacitors, and inductors. Discrete semiconductors and passive components manufactured by Vishay are used in virtually all types of electronic products, including those in the industrial, computing, automotive, consumer electronic products, telecommunications, power supplies, military/aerospace, and medical industries.
We operate in five product segments: MOSFETs; Diodes; Optoelectronic Components; Resistors & Inductors; and Capacitors.
Since 1985, we have pursued a business strategy of growth through focused research and development and acquisitions. Through this strategy, we have grown to become one of the world's largest manufacturers of discrete semiconductors and passive components. We expect to continue our strategy of acquisitions while also maintaining a prudent capital structure.
We are focused on enhancing stockholder value and improving earnings per share. We plan 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 R&D and engineering technical staff and plan to further increase it; 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 2014, our Board of Directors instituted a quarterly dividend payment program. We also have opportunistically repurchased our stock. The permitted capacity to repurchase shares of stock or pay dividends under our credit facility increases each quarter by an amount equal to 20% of net income. At April 4, 2015, our total permitted capacity to repurchase shares of stock or pay dividends under our credit facility is $190.0 million. Although we have no current plans, we will continue to evaluate attractive stock repurchase opportunities.
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. For several years, we implemented aggressive cost reduction programs. We continue to monitor the current economic environment and its potential effects on our customers and the end markets that we serve. Additionally, we continue to closely monitor our costs, 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. In response to the economic environment, we began implementing a targeted cost reduction program in the fourth fiscal quarter of 2013 to support our profitability without jeopardizing our growth plan. Complete implementation of the targeted cost reduction programs is expected to occur before the end of the first fiscal quarter of 2016. See additional information regarding our competitive strengths and key challenges as disclosed in Part 1 of our Annual Report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission (the "SEC") on February 19, 2015.
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.") Revenues were negatively impacted by foreign currency exchange rates in the first fiscal quarter of 2015. Excluding the foreign currency exchange rate impact, revenues in the first fiscal quarter of 2015 increased slightly versus the prior fiscal quarter and the first fiscal quarter of 2014. Operating results met our expectations at this relatively low revenue level. An increase in orders resulted in an increase in key financial metrics compared to the prior fiscal quarter and the first fiscal quarter of 2014.
27

Net revenues for the fiscal quarter ended April 4, 2015 were $593.4 million, compared to $602.4 million for the fiscal quarter ended March 29, 2014. The net earnings attributable to Vishay stockholders for the fiscal quarter ended April 4, 2015 were $30.7 million, or $0.20 per diluted share, compared to $25.8 million, or $0.17 per diluted share for the fiscal quarter ended March 29, 2014.
Net earnings attributable to Vishay stockholders for the fiscal quarters ended April 4, 2015 and March 29, 2014 include items affecting comparability. The reconciliation below includes certain financial measures which are not recognized in accordance with GAAP, including adjusted net earnings and adjusted earnings per share. These non-GAAP measures should not be viewed as an alternative to GAAP measures of performance. Non-GAAP measures such as adjusted net earnings and adjusted earnings per share 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 these measures are meaningful because they provide insight with respect to our intrinsic operating results. Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to understanding our intrinsic operations.
The items affecting comparability are (in thousands, except per share amounts):

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
GAAP net earnings attributable to Vishay stockholders |  | $ | 30,699 |  |  | $ | 25,810 |
Reconciling items affecting operating margin: |  |  |  |  |  |  |  |
Restructuring and severance costs |  | $ | 1,410 |  |  | $ | 6,404 |
Reconciling items affecting tax expense: |  |  |  |  |  |  |  |
Tax effects of items above and other one-time tax expense (benefit) |  | $ | (508 | ) |  | $ | (2,097 | )
Adjusted net earnings |  | $ | 31,601 |  |  | $ | 30,117 |
Adjusted weighted average diluted shares outstanding |  |  | 152,666 |  |  |  | 152,556 |
Adjusted earnings per diluted share * |  | $ | 0.21 |  |  | $ | 0.20 |

* Includes add-back of interest on exchangeable notes in periods where the notes are dilutive.
Our results for the fiscal quarters ended April 4, 2015 and March 29, 2014 represent the effects of an improving business environment, increasing order activity, our cost reduction programs, and our organic growth initiatives. Our revenue results for the fiscal quarter ended ended April 4, 2015 were negatively affected by foreign currency effects, especially from the euro. Despite the negative foreign currency effect on revenues, we were able to maintain our profitability. Our percentage of euro-based sales approximates our percentage of euro-based expenses so the negative foreign currency impact on revenues was substantially offset by the positive impact on expenses. Despite revenues below our expected run-rate, our pre-tax results were as we would expect based on our business model.
28

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 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. We analyze trends and changes in average selling prices to evaluate likely future pricing. The erosion of average selling prices of established products is typical for semiconductor products. We attempt to offset this deterioration with ongoing cost reduction activities and new product introductions. Our specialty passive components are more resistant to average selling price erosion.
29

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 2014 through the first fiscal quarter of 2015 (dollars in thousands):

|  | 1st Quarter 2014 |  |  | 2nd Quarter 2014 |  |  | 3rd Quarter 2014 |  |  | 4th Quarter 2014 |  |  | 1st Quarter 2015 |
Net revenues |  | $ | 602,378 |  |  | $ | 641,929 |  |  | $ | 638,211 |  |  | $ | 610,764 |  |  | $ | 593,436 |
Gross profit margin |  |  | 24.1 | % |  |  | 25.6 | % |  |  | 24.8 | % |  |  | 23.5 | % |  |  | 24.4 | %
Operating margin (1) |  |  | 7.1 | % |  |  | 9.0 | % |  |  | 7.1 | % |  |  | 7.1 | % |  |  | 8.0 | %
End-of-period backlog (2) |  | $ | 664,200 |  |  | $ | 663,800 |  |  | $ | 598,000 |  |  | $ | 554,700 |  |  | $ | 559,600 |
Book-to-bill ratio |  |  | 1.09 |  |  |  | 1.00 |  |  |  | 0.91 |  |  |  | 0.95 |  |  |  | 1.05 |
Inventory turnover |  |  | 4.12 |  |  |  | 4.19 |  |  |  | 4.18 |  |  |  | 4.21 |  |  |  | 4.20 |
Change in ASP vs. prior quarter |  |  | -1.0 | % |  |  | -0.6 | % |  |  | -0.9 | % |  |  | -0.9 | % |  |  | -0.9 | %

(1) Operating margin for the first, second, third, and fourth fiscal quarters of 2014 and the first fiscal quarter of 2015 includes $6.4 million, $9.0 million, $3.5 million, $2.0 million, and $1.4 million, respectively, of restructuring and severance expenses (see Note 2 to our consolidated condensed financial statements). Operating margin for the third fiscal quarter of 2014 includes $15.6 million of U.S. pension settlement charges.
(2) End of period backlog for the second fiscal quarter of 2014 reflects a total of $1.3 million related to the backlog of Holy Stone Polytech Co., Ltd. as of the date of acquisition. End of period backlog for the third fiscal quarter of 2014 reflects a total of $8.2 million related to the backlog of Capella as of the date of acquisition.
See "Financial Metrics by Segment" below for net revenues, book-to-bill ratio, and gross profit margin broken out by segment.
Revenues were within our expected range, but decreased slightly versus the prior fiscal quarters. Foreign currency exchange rates negatively impacted revenues. Excluding the foreign currency exchange rate impact, revenues increased slightly versus the prior fiscal quarter and the first fiscal quarter of 2014. We experienced a broad increase in order level in the first fiscal quarter of 2015. Average selling prices continue to decline primarily due to our commodity semiconductor products and the effects of growing our Resistors & Inductors business in Asia.
Gross margins increased versus the prior fiscal quarter and first fiscal quarter of 2014. The increases are primarily due to volume increases and fixed cost savings. Gross margins have been negatively impacted by additional depreciation associated with our cost reduction programs beginning with the fourth fiscal quarter of 2013 and will continue to be negatively impacted until the complete implementation of our cost reduction programs.
The book-to-bill ratio in the first fiscal quarter of 2015 increased to 1.05 from 0.95 in the fourth fiscal quarter of 2014. The book-to-bill ratios for distributors and original equipment manufacturers ("OEM") were 1.04 and 1.06, respectively, versus ratios of 0.93 and 0.96, respectively, during the fourth fiscal quarter of 2014.
For the second fiscal quarter of 2015, we anticipate revenues between $600 million and $640 million (assuming a 1.10 U.S. dollar to euro exchange rate) and gross margins between 24% and 26%.
30

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 2014 through the first fiscal quarter of 2015 (dollars in thousands):

|  | 1st Quarter 2014 |  |  | 2nd Quarter 2014 |  |  | 3rd Quarter 2014 |  |  | 4th Quarter 2014 |  |  | 1st Quarter 2015 |
MOSFETs |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net revenues |  | $ | 113,141 |  |  | $ | 124,042 |  |  | $ | 121,659 |  |  | $ | 111,695 |  |  | $ | 106,770 |
Book-to-bill ratio |  |  | 1.13 |  |  |  | 1.05 |  |  |  | 0.83 |  |  |  | 0.95 |  |  |  | 0.99 |
Gross profit margin |  |  | 11.2 | % |  |  | 15.2 | % |  |  | 14.3 | % |  |  | 9.6 | % |  |  | 12.9 | %
Segment operating margin |  |  | 2.2 | % |  |  | 7.7 | % |  |  | 6.4 | % |  |  | 1.2 | % |  |  | 4.2 | %
Diodes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net revenues |  | $ | 136,929 |  |  | $ | 149,571 |  |  | $ | 151,444 |  |  | $ | 141,344 |  |  | $ | 136,511 |
Book-to-bill ratio |  |  | 1.09 |  |  |  | 1.07 |  |  |  | 0.89 |  |  |  | 0.83 |  |  |  | 1.01 |
Gross profit margin |  |  | 21.7 | % |  |  | 23.2 | % |  |  | 23.9 | % |  |  | 22.2 | % |  |  | 21.9 | %
Segment operating margin |  |  | 16.8 | % |  |  | 18.8 | % |  |  | 19.6 | % |  |  | 17.8 | % |  |  | 17.2 | %
Optoelectronic Components |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net revenues |  | $ | 57,498 |  |  | $ | 63,258 |  |  | $ | 67,549 |  |  | $ | 69,943 |  |  | $ | 68,625 |
Book-to-bill ratio |  |  | 1.16 |  |  |  | 1.04 |  |  |  | 0.96 |  |  |  | 0.99 |  |  |  | 1.09 |
Gross profit margin |  |  | 36.9 | % |  |  | 36.0 | % |  |  | 36.4 | % |  |  | 32.2 | % |  |  | 32.3 | %
Segment operating margin |  |  | 30.3 | % |  |  | 29.9 | % |  |  | 30.5 | % |  |  | 23.7 | % |  |  | 24.9 | %
Resistors & Inductors |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net revenues |  | $ | 189,299 |  |  | $ | 193,314 |  |  | $ | 190,454 |  |  | $ | 186,549 |  |  | $ | 187,494 |
Book-to-bill ratio |  |  | 1.04 |  |  |  | 0.98 |  |  |  | 0.98 |  |  |  | 1.02 |  |  |  | 1.05 |
Gross profit margin |  |  | 31.8 | % |  |  | 31.8 | % |  |  | 31.3 | % |  |  | 32.2 | % |  |  | 31.4 | %
Segment operating margin |  |  | 26.6 | % |  |  | 26.9 | % |  |  | 26.4 | % |  |  | 27.3 | % |  |  | 26.4 | %
Capacitors |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net revenues |  | $ | 105,511 |  |  | $ | 111,744 |  |  | $ | 107,105 |  |  | $ | 101,233 |  |  | $ | 94,036 |
Book-to-bill ratio |  |  | 1.09 |  |  |  | 0.88 |  |  |  | 0.90 |  |  |  | 0.94 |  |  |  | 1.15 |
Gross profit margin |  |  | 20.4 | % |  |  | 23.6 | % |  |  | 19.3 | % |  |  | 18.9 | % |  |  | 21.6 | %
Segment operating margin |  |  | 14.5 | % |  |  | 18.0 | % |  |  | 13.5 | % |  |  | 12.7 | % |  |  | 15.5 | %

31

Acquisition Activity
As part of our growth strategy, we seek to expand through targeted acquisitions of other manufacturers of electronic components that have established positions in major markets, reputations for product quality and reliability, and product lines with which we have substantial marketing and technical expertise. This includes exploring opportunities to acquire targets to gain market share, penetrate different geographic markets, enhance new product development, round out our existing product lines, or grow our high margin niche market businesses. Acquisitions of passive components businesses would likely be made to strengthen and broaden our position as a specialty product supplier; acquisitions of discrete semiconductor businesses would be made to increase market share and to generate synergies. To limit our financial exposure, we have implemented a policy not to pursue acquisitions if our post-acquisition debt would exceed 2.5x our pro forma earnings before interest, taxes, depreciation, and amortization ("EBITDA"). For these purposes, we calculate pro forma EBITDA as the adjusted EBITDA of Vishay and the target for Vishay's four preceding fiscal quarters, with a pro forma adjustment for savings which management estimates would have been achieved had the target been acquired by Vishay at the beginning of the four fiscal quarter period.
Our growth plan targets adding, through acquisitions, an average of approximately $100 million of revenues per year. Depending on the opportunities available, we might make several smaller acquisitions or a few larger acquisitions. We intend to make such acquisitions using mainly cash, rather than debt or equity, although we do have capacity on our revolving credit facility if necessary. We are not currently targeting acquisitions with a purchase price larger than $500 million.
Since 2011, we have acquired the specialty product businesses of Huntington Electric, HiRel Systems, LLC, and MCB Industrie. In 2014, we made strategic acquisitions of Holy Stone Polytech and Capella and plan to use the technology and engineering capabilities acquired to further grow our business. We continue to explore additional acquisition opportunities despite the current economic volatility.
There is no assurance that we will be able to identify and acquire suitable acquisition candidates at price levels and on terms and conditions we consider acceptable.
32

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 46% - 48% 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 margin by approximately $460,000 to $480,000. Sudden changes in the business conditions, however, may not allow us to quickly adapt our manufacturing capacity and cost structure.
Historically, our primary cost reduction technique was through the transfer of production to the extent possible from high-labor-cost countries, such as the United States and Western Europe, to lower-labor-cost countries, such as the Czech Republic, Hungary, Israel, India, Malaysia, Mexico, the People's Republic of China, and the Philippines. Between 2001 and 2009, we recorded, in the consolidated condensed statements of operations, restructuring and severance costs totaling $320 million and related asset write-downs totaling $89 million in order to reduce our cost structure going forward. We also incurred significant costs to restructure and integrate acquired businesses, which was included in the cost of the acquisitions under then-applicable GAAP.
We did not initiate any new restructuring projects in 2010, 2011, or 2012 and thus did not record any restructuring and severance expenses during such periods. Occasionally, our ongoing cost containment activities are not adequate and we must take actions to maintain our cost competitiveness. On October 28, 2013, we announced various cost reduction programs as part of our continuous efforts to improve efficiency and operating performance. We recorded $1.4 million of restructuring and severance expenses in the first fiscal quarter of 2015 for expenses that were recognizable under GAAP during the period and $25.1 million of restructuring and severance expenses since the cost reduction programs were implemented. The remaining expenses associated with the programs will be recorded as they become recognizable under GAAP.
The programs primarily focus on a plan to enhance the competitiveness of our MOSFETs segment and a voluntary separation / early retirement offer to certain employees Company-wide. We also implemented two other smaller cost reduction programs concerning the manufacturing of products within our Diodes segment. The programs in total are expected to lower costs by approximately $36 million per year when fully implemented at expected cash costs of approximately $32 million.
The project for the MOSFETs segment will extend over a period of approximately two years. The manufacture of wafers for a substantial share of products will be transferred into a more cost-efficient fab. As a consequence, certain other wafer manufacturing currently occurring in-house will be transferred to third-party foundries.
The total cash costs associated with the MOSFETs initiatives, principally severance, are expected to be approximately $16 million. Once fully implemented, we anticipate that the MOSFETs programs will result in an annual reduction in variable and fixed manufacturing costs of approximately $23 million at current volumes.
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The voluntary separation / early retirement offer was made to employees worldwide who were eligible because they met job classification, age, and/or years-of-service criteria as of October 31, 2013. The program benefits vary by country and job classification, but generally offer a cash loyalty bonus. All eligible employees have been identified. The voluntary separation / early retirement program will not impact manufacturing operations or our growth plan. Our named executive officers (as defined in our proxy statement) and certain other key employees, generally research, development, and engineering personnel, were not eligible for the voluntary separation / early retirement program. The effective separation / retirement date for most eligible employees who accepted the offer was June 30, 2014 or earlier, with a few exceptions to allow for a transition period.
The total costs associated with the voluntary separation / early retirement program are approximately $13.3 million. The Company anticipates that the program will result in an annual reduction in fixed costs of approximately $10 million, split approximately 35% in manufacturing and 65% in selling, general, and administrative expenses.
Two other smaller cost reduction programs relate to the transfer of production of certain products within our Diodes segment, which were initiated in the third fiscal quarter of 2014. Both programs are connected to production moves, in order to take advantage of lower labor costs in one program and from the consolidation of manufacturing locations in the other. The total cash costs associated with these production transfers are expected to be approximately $3 million, and will result in annual cost savings of approximately $3 million when fully implemented.
We believe that our manufacturing footprint is suitable to serve our customers and end markets, while maintaining lower manufacturing costs. Except for the distinct and targeted programs noted above, we do not anticipate any other material restructuring activities in 2015. As we have demonstrated the past three years, we believe that we can substantially maintain our trained workforce, even at lower manufacturing activity levels, by reducing hours and limiting the use of subcontractors and foundries. However, a continued sluggish business environment for the electronics industry or the recurrence of a significant economic downturn may require us to implement additional restructuring initiatives.
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 our acquisitions of Huntington Electric, HiRel Systems, LLC, MCB Industrie, Holy Stone Polytech, or Capella, but we expect to have some level of future restructuring expenses due to acquisitions.
Even as we seek to manage our costs, 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.
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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 significantly stronger during the first fiscal quarter of 2015 compared to the prior fiscal quarter and prior year period, with the translation of foreign currency revenues and expenses into U.S. dollars decreasing reported revenues and expenses versus the prior year periods.
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 and selling, general, and administrative expense for the first fiscal quarter of 2015 have been favorably impacted (compared to the prior fiscal quarter and prior year period) by local currency transactions of subsidiaries which use the U.S. dollar as their functional currency.
Beginning in the third fiscal quarter of 2014, we entered into a forward contract with a highly-rated financial institution to mitigate the foreign currency risk associated with an intercompany loan denominated in a currency other than the legal entity's functional currency. The notional amount of the forward contract was $14 million as of April 4, 2015. The intercompany loan was used to finance a portion of the purchase price for Capella. The forward contracts settle monthly and are expected to be renewed at our discretion on a monthly basis until the intercompany loan is repaid. The forward contract was renewed on the last day of the first fiscal quarter. The forward contracts are carried at fair value in our consolidated condensed balance sheets. We have not designated the forward contract as a hedge for accounting purposes, and as such the change in the fair value of contract is recognized in our consolidated condensed statements of operations as a component of other income (expense). We do not utilize derivatives or other financial instruments for trading or other speculative purposes.
35

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 4, 2015 |  |  | March 29, 2014 |
Cost of products sold |  |  | 75.6 | % |  |  | 75.9 | %
Gross profit |  |  | 24.4 | % |  |  | 24.1 | %
Selling, general & administrative expenses |  |  | 16.2 | % |  |  | 16.0 | %
Operating income |  |  | 8.0 | % |  |  | 7.1 | %
Income before taxes and noncontrolling interest |  |  | 7.5 | % |  |  | 6.3 | %
Net earnings attributable to Vishay stockholders |  |  | 5.2 | % |  |  | 4.3 | %
________ |  |  |  |  |  |  |  |
Effective tax rate |  |  | 30.7 | % |  |  | 31.5 | %

Net Revenues
Net revenues were as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Net revenues |  | $ | 593,436 |  |  | $ | 602,378 |
Change versus comparable prior year period |  | $ | (8,942 | ) |  |  |  |
Percentage change versus comparable prior year period |  |  | -1.5 | % |  |  |  |

Changes in net revenues were attributable to the following:

|  | vs. Prior Year Quarter |
Change attributable to: |  |  |
Increase in volume |  |  | 5.6 | %
Decrease in average selling prices |  |  | -2.1 | %
Foreign currency effects |  |  | -6.2 | %
Acquisitions |  |  | 1.9 | %
Other |  |  | -0.7 | %
Net change |  |  | -1.5 | %

Revenues continue to be below our expected run-rate. Our revenue results for the fiscal quarter ended ended April 4, 2015 were negatively affected by foreign currency effects. We experienced a broad increase in demand for our products in the first fiscal quarter of 2015 and overall higher demand compared to the first fiscal quarter of 2014.
We deduct, from the sales that we record to distributors, allowances for future credits that we expect to provide for returns, scrapped product, and price adjustments under various programs made available to the distributors. We make deductions corresponding to particular sales in the period in which the sales are made, although the corresponding credits may not be issued until future periods. We estimate the deductions based on sales levels to distributors, inventory levels at the distributors, current and projected market trends and conditions, recent and historical activity under the relevant programs, changes in program policies, and open requests for credits. We recorded deductions from gross revenues under our distributor incentive programs of $20.0 million and $20.2 million for the three fiscal months ended April 4, 2015 and March 29, 2014, respectively, or 3.3% and 3.2% of gross revenues, respectively. Actual credits issued under the programs during the three fiscal months ended April 4, 2015 and March 29, 2014 were $25.3 million and $22.1 million, respectively. Increases and decreases in these incentives are largely attributable to the then-current business climate.
Royalty revenues, included in net revenues on the consolidated condensed statements of operations, were approximately $1.1 million and $1.3 million for the three fiscal months ended April 4, 2015 and March 29, 2014, respectively.
Gross Profit and Margins
Gross profit margins for the fiscal quarter ended April 4, 2015 were 24.4%, versus 24.1%, for the comparable prior year period. The increase was due primarily to higher volume and our cost reduction efforts.
36

Segments
Analysis of revenues and gross profit margins for our segments is provided below.
MOSFETs
Net revenues of the MOSFETs segment were as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Net revenues |  | $ | 106,770 |  |  | $ | 113,141 |
Change versus comparable prior year period |  | $ | (6,371 | ) |  |  |  |
Percentage change versus comparable prior year period |  |  | -5.6 | % |  |  |  |

Changes in MOSFETs segment net revenues were attributable to the following:

|  | vs. Prior Year Quarter |
Change attributable to: |  |  |
Increase in volume |  |  | 1.1 | %
Decrease in average selling prices |  |  | -4.3 | %
Foreign currency effects |  |  | -2.4 | %
Other |  |  | 0.0 | %
Net change |  |  | -5.6 | %

Gross profit as a percentage of net revenues for the MOSFETs segment was as follows:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Gross profit margin |  |  | 12.9 | % |  |  | 11.2 | %

In the first fiscal quarter of 2015, the MOSFETs segment could not maintain the revenue level of the corresponding prior year period. The increase in volume was not large enough to offset the negative impacts from declining selling prices and the change in the euro foreign currency exchange rate. We experienced a positive development in the business directly with end customers, especially in the Americas. However, that could not compensate for the decline in business with distributors in Asia.
The increase in the gross profit margin in the first fiscal quarter was primarily due to volume increases from restocking the low inventory level from the end of 2014. This was in the opposite direction in the corresponding prior year period. The negative foreign currency exchange rate impact on revenues was offset by the positive impact on corresponding costs. Other cost reductions offset general cost inflation.
The pricing pressure for our established MOSFETs products was lower than in prior periods. We have experienced a moderate decline in average selling prices versus the first fiscal quarter of 2014 and no decline versus the prior fiscal quarter.
In 2013, we announced a cost reduction program to enhance the competitiveness of our MOSFETs segment. We continue to implement the program, which is long-term in nature and will not provide significant improvement until the program is close to full implementation. See "Cost Management" above.
We continue to be optimistic about the long-term prospects of the MOSFETs segment and continue to make capital and R&D investments in this business.
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Diodes
Net revenues of the Diodes segment were as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Net revenues |  | $ | 136,511 |  |  | $ | 136,929 |
Change versus comparable prior year period |  | $ | (418 | ) |  |  |  |
Percentage change versus comparable prior year period |  |  | -0.3 | % |  |  |  |

Changes in Diodes segment net revenues were attributable to the following:

|  | vs. Prior Year Quarter |
Change attributable to: |  |  |
Increase in volume |  |  | 7.4 | %
Decrease in average selling prices |  |  | -2.1 | %
Foreign currency effects |  |  | -5.0 | %
Other |  |  | -0.6 | %
Net change |  |  | -0.3 | %

Gross profit as a percentage of net revenues for the Diodes segment was as follows:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Gross profit margin |  |  | 21.9 | % |  |  | 21.7 | %

The Diodes segment maintained its revenue level in the first fiscal quarter of 2015 versus the corresponding prior year period despite negative foreign currency exchange rate effects, especially from the euro. This was achieved through volume increases in the business in Europe and directly with end customers in the Americas.
The gross profit margin also remained relatively stable versus the corresponding prior year period due to the increase in sales volume and the effects of our cost reduction programs that offset the decreased average selling prices and effects of general cost inflation. The negative foreign currency rate impact on revenues was mostly offset by the positive impact on corresponding costs.
The pricing pressure for our established Diodes products was slightly reduced. We have experienced a slight price decline versus the first fiscal quarter of 2014 and the prior fiscal quarter.
The cost reduction programs announced in 2013 include two smaller projects to improve the results of the Diodes segment. These projects, which were initiated in the third fiscal quarter of 2014 and substantially implemented in the fourth fiscal quarter of 2014, demonstrate our ongoing effort to improve the results of this segment. See "Cost Management" above.
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Optoelectronic Components
Net revenues of the Optoelectronic Components segment were as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Net revenues |  | $ | 68,625 |  |  | $ | 57,498 |
Change versus comparable prior year period |  | $ | 11,127 |  |  |  |  |
Percentage change versus comparable prior year period |  |  | 19.4 | % |  |  |  |

Changes in Optoelectronic Components segment net revenues were attributable to the following:

|  | vs. Prior Year Quarter |
Change attributable to: |  |  |
Increase in volume |  |  | 16.3 | %
Decrease in average selling prices |  |  | -3.1 | %
Foreign currency effects |  |  | -7.7 | %
Acquisition |  |  | 15.6 | %
Other |  |  | -1.7 | %
Net change |  |  | 19.4 | %

Gross profit as a percentage of net revenues for the Optoelectronic Components segment was as follows:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Gross profit margin |  |  | 32.3 | % |  |  | 36.9 | %

In the first fiscal quarter of 2015, the Optoelectronic Components segment achieved significant increases in revenue versus the corresponding prior year period due to a growing business in Asia and higher distribution sales in Europe. The Capella acquisition also contributed to the increase in revenues (see below) while negative foreign currency exchange rate effects, especially from the euro, partially offset the increase.
The increase in sales volume did not lead to an increase in gross profit margin versus the first fiscal quarter of 2014 due to lower average selling prices, foreign currency effects, and general cost inflation. The Capella acquisition also contributed at a lower gross margin percentage than our existing Optoelectronic Components businesses.
Typical pricing pressure for our established Optoelectronic Components products continues. We have experienced moderate declines in average selling prices versus the first fiscal quarter of 2014 and a slight decline versus the prior fiscal quarter.
In 2014, we acquired Capella, a fabless IC design company specializing in optoelectronic products, in a two step transaction completed on December 31, 2014. Capella is included in the Optoelectronic Components segment results from the date we obtained control in September 2014.
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Resistors & Inductors
Net revenues of the Resistors & Inductors segment were as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Net revenues |  | $ | 187,494 |  |  | $ | 189,299 |
Change versus comparable prior year period |  | $ | (1,805 | ) |  |  |  |
Percentage change versus comparable prior year period |  |  | -1.0 | % |  |  |  |

Changes in Resistors & Inductors segment net revenues were attributable to the following:

|  | vs. Prior Year Quarter |
Change attributable to: |  |  |
Increase in volume |  |  | 10.0 | %
Decrease in average selling prices |  |  | -1.7 | %
Foreign currency effects |  |  | -8.2 | %
Other |  |  | -1.1 | %
Net change |  |  | -1.0 | %

Gross profit as a percentage of net revenues for the Resistors & Inductors segment was as follows:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Gross profit margin |  |  | 31.4 | % |  |  | 31.8 | %

The Resistors & Inductors Segment continues to generate strong revenues. Revenues in the first fiscal quarter of 2015 decreased slightly versus the first fiscal quarter 2014, mainly due to foreign currency exchange rate changes. Revenues in regions Asia and Americas increased significantly, whereas region Europe was negatively impacted by unfavorable foreign currency exchange rate changes.
The majority of the industry segments have contributed to the higher revenues excluding foreign currency exchange rate impacts.
The gross profit margin was negatively impacted by unfavorable exchange rates, which led to the slight decrease in gross profit margin versus first fiscal quarter of 2014. The reduction in metal/material prices and improvements in our manufacturing entities were not sufficient to fully compensate the adverse exchange rates and inflation.
Average selling prices decreased slightly compared to first fiscal quarter of 2014, in line with our expectations for this segment.
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Capacitors
Net revenues of the Capacitors segment were as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Net revenues |  | $ | 94,036 |  |  | $ | 105,511 |
Change versus comparable prior year period |  | $ | (11,475 | ) |  |  |  |
Percentage change versus comparable prior year period |  |  | -10.9 | % |  |  |  |

Changes in Capacitors segment net revenues were attributable to the following:

|  | vs. Prior Year Quarter |
Change attributable to: |  |  |
Decrease in volume |  |  | -6.2 | %
Increase in average selling prices |  |  | 0.3 | %
Foreign currency effects |  |  | -7.6 | %
Acquisition |  |  | 2.3 | %
Other |  |  | 0.3 | %
Net change |  |  | -10.9 | %

Gross profit as a percentage of net revenues for the Capacitors segment was as follows:

|  | Fiscal quarters ended |
|  | April 4, 2015 |  |  | March 29, 2014 |
Gross profit margin |  |  | 21.6 | % |  |  | 20.4 | %

Revenues in the first fiscal quarter of 2015 for the Capacitors segment decreased versus the prior year period. Revenues were unfavorably impacted by foreign currency exchange rate changes. Whereas revenues in regions Asia and Americas were relatively stable versus prior year period, region Europe experienced a significant reduction primarily due to foreign currency exchange rate changes.
The revenue decrease was experienced in almost all industry segments, with exception of the medical industry segment.
The gross profit margin improved versus the first fiscal quarter of 2014, primarily due to reduction in metals and material prices and better operational efficiencies. These two effects more than off-set the inflationary impact and the unfavorable foreign currency exchange rate changes.
Average selling prices increased slightly versus the first fiscal quarter of 2014.
On June 11, 2014, we acquired Holy Stone Polytech, a Japanese manufacturer of tantalum capacitors and formerly a subsidiary of Holy Stone Enterprise Co. Ltd., for $20.6 million, net of cash acquired. The acquisition is expected to strengthen our position in tantalum capacitors, especially in Asia. We plan to use the technology acquired to develop new products and enter new product markets.
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Selling, General, and Administrative Expenses
Selling, general, and administrative ("SG&A") expenses are summarized as follows (dollars in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Total SG&A expenses |  | $ | 96,070 |  |  | $ | 96,307 |
as a percentage of revenues |  |  | 16.2 | % |  |  | 16.0 | %

The overall decrease in SG&A expenses is primarily attributable to foreign currency exchange rate effects, the benefits of our voluntary separation / early retirement program (see "Cost Management" above), and the non-repetition of additional SG&A expenses incurred in 2014 to close acquisitions, partially offset by SG&A expenses of acquired companies and additional compensation costs in general.
Several items included in SG&A expenses impact the comparability of these amounts, as summarized below (in thousands):

| Fiscal quarters ended |
| April 4, 2015 |  | March 29, 2014 |
Amortization of intangible assets |  | $ | 6,301 |  |  | $ | 3,800 |
Net loss (gain) on sales of assets |  |  | (83 | ) |  |  | (60 | )

The acquisitions of Capella and Holy Stone Polytech in 2014 increased our amortizable intangible assets balance by $78.2 million.
Other Income (Expense)
Interest expense for the fiscal quarter ended April 4, 2015 increased by $0.4 million versus the fiscal quarter ended March 29, 2014. The increase is primarily due to higher average outstanding balances on our credit facility in 2015.
The following tables analyze the components of the line "Other" on the consolidated condensed statements of operations (in thousands):

|  | Fiscal quarters ended |  |  |  |
|  | April 4, 2015 |  |  | March 29, 2014 |  |  | Change |
Foreign exchange gain (loss) |  | $ | 1,725 |  |  | $ | (112 | ) |  | $ | 1,837 |
Interest income |  |  | 1,197 |  |  |  | 1,223 |  |  |  | (26 | )
Other |  |  | 538 |  |  |  | 201 |  |  |  | 337 |
|  | $ | 3,460 |  |  | $ | 1,312 |  |  | $ | 2,148 |

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Income Taxes
For the fiscal quarter ended April 4, 2015, our effective tax rate was 30.7%, as compared to 31.5% for the fiscal quarter ended March 29, 2014. The effective tax rate is generally less than the U.S. statutory rate primarily because of earnings in foreign jurisdictions.
We operate in a global environment with significant operations in various jurisdictions outside the United States. Accordingly, our consolidated income tax rate is a composite rate reflecting our earnings and the applicable tax rates in the various jurisdictions where we operate. Part of our strategy is to achieve cost savings by operating in countries where we can take advantage of lower labor costs and available tax and other government-sponsored incentives. Accordingly, our effective tax rate is generally less than the U.S. statutory tax rate. Changes in our effective tax rate are largely attributable to changes in the mix of pretax income among our various taxing jurisdictions.
During the three fiscal months ended April 4, 2015, the liabilities for unrecognized tax benefits decreased by $0.8 million on a net basis, principally due to currency effects.
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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 past 13 years, and cash flows from operations in excess of $100 million in each of the past 20 years.
We refer to the amount of cash generated from operations in excess of our capital expenditure needs and net of proceeds from the sale of assets as "free cash," a measure which management uses to evaluate our ability to fund acquisitions, repay debt, and otherwise enhance stockholder value through stock repurchases or dividends. Vishay has generated positive "free cash" in each of the past 18 years, and "free cash" in excess of $80 million in each of the past 13 years. In this volatile economic environment, we continue to focus on the generation of free cash, including an emphasis on cost controls.
We continued to generate positive cash flows from operations during the fiscal quarter ended April 4, 2015. Despite a slow start in terms of free cash generation, we continue to expect cash generation in 2015 in line with our history. 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 current economic environment worsens.
Beginning in the fourth fiscal quarter of 2010, we have reacted to favorable market conditions to significantly reshape the company's capital structure. We have completed three issuances of low-coupon convertible debentures utilizing the proceeds of those debenture offerings to repurchase 44.3 million shares of our common stock.
We also entered into a new, larger, revolving credit facility in 2010, which was amended and restated on August 8, 2013. The total revolving commitment of our credit facility is currently $640 million, and we have the ability to request up to an additional $50 million of incremental commitments, subject to the satisfaction of certain conditions. At April 4, 2015 and December 31, 2014, $215 million and $200 million, respectively, were outstanding under our credit facility. The credit facility provides a revolving commitment through August 8, 2018.
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, borrowings bear interest at LIBOR plus 1.75%. The interest rate on our borrowings will increase to LIBOR plus 2.00% if our leverage ratio equals or exceeds 2.50 to 1 and will decrease to LIBOR plus 1.50% if our leverage ratio decreases below 1.50 to 1. We are also required to pay facility fees on the entire commitment amount based on our leverage ratio. Based on our current leverage ratio, the facility fee is 0.35% per annum. Such facility fee will increase to 0.50% per annum if our leverage ratio equals or exceeds 2.50 to 1 and will decrease to 0.30% per annum if our leverage ratio decreases below 1.50 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 for use in, or arising under the laws of, any country other than the United States, assets located 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. Certain of our subsidiaries are permitted to borrow under the credit facility, subject to the satisfaction of specified conditions. Any borrowings by these subsidiaries under the credit facility will be guaranteed by Vishay and certain subsidiaries.
The credit facility also limits or restricts us, from, among other things, incurring indebtedness, incurring liens on assets, making investments and acquisitions, and making asset sales, and making other restricted payments, and requires us to comply with other covenants, including the maintenance of specific financial ratios.
The financial maintenance covenants include (a) an interest expense 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 2.75 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 August 8, 2013.
We were in compliance with all financial covenants under the credit facility at April 4, 2015. Our interest expense coverage ratio and leverage ratio were 13.28 to 1 and 1.92 to 1, respectively. We expect to continue to be in compliance with these covenants based on current projections.
If we are not in compliance with all of the required financial covenants, the credit facility could be terminated by the lenders, and all amounts outstanding pursuant to the credit facility could become immediately payable. Additionally, our exchangeable unsecured notes due 2102 and our convertible senior debentures due 2040, due 2041, and due 2042 have cross-default provisions that could accelerate repayment in the event the indebtedness under the credit facility is accelerated.
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Our permitted capacity to repurchase shares of our outstanding common stock or pay cash dividends under the credit facility increases each quarter by an amount equal to 20% of net income. At April 4, 2015, our credit facility allowed us to repurchase our common stock or pay cash dividends up to $190.0 million. In 2014, our Board of Directors instituted a quarterly dividend payment program and declared the first cash dividend in the history of Vishay. Cash dividends of $0.06 per share of common stock and Class B common stock were paid each quarter in 2014 and the first fiscal quarter of 2015. The amount and timing of any future stock repurchases or cash dividend payments remains subject to authorization of our Board of Directors.
The balance of our revolving credit facility was $200 million at December 31, 2014. We borrowed $50 million and repaid $35 million on our credit facility during the three fiscal months ended April 4, 2015. We borrowed $53 million in 2014 to partially fund the Capella acquisition while achieving future flexibility given the legal entity and financial structure utilized for the acquisition. Subsequent to the acquisition of the noncontrolling interest in Capella on December 31, 2014, we expect to repatriate cash from 2014 earnings of non-U.S. subsidiaries to the United States primarily to repay those borrowings on the revolving credit facility, and also to realign the acquired entity structure to have Capella's U.S. subsidiary directly owned by Vishay Intertechnology, Inc. The repatriation and reduction of the revolving credit facility balance is anticipated in the second fiscal quarter of 2015, pending completion of statutory audits of certain subsidiaries required to distribute earnings. The average outstanding balance on our credit facility calculated at fiscal month-ends was $204 million and the highest amount outstanding on our credit facility at a month end was $215 million during the three fiscal months ended April 4, 2015.
Prior to three months before the maturity date, our convertible senior debentures are convertible by the holders under certain circumstances. The convertible senior debentures are not currently convertible, but the conversion criteria of the debentures will continue to be evaluated and the debentures may become convertible in the future. At the direction of our Board of Directors, we intend, upon conversion, to repay the principal amount of the convertible debentures in cash and settle any additional amounts in shares of our common stock. We intend to finance the principal amount of any converted debentures using borrowings under our credit facility.
Management expects to periodically pay down the balance of our revolving credit facility with available cash or use the credit facility to meet 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, or conversion of our convertible debentures may require additional borrowing under our credit facility or may otherwise require us to incur additional debt. No principal payments on our outstanding debt are due before the maturity of our revolving credit facility in August 2018.
Substantially all of our April 4, 2015 cash and cash equivalents and short-term investments balances were held by our non-U.S. subsidiaries. At the present time, we expect that cash and profits generated by our non-U.S. subsidiaries prior to 2014, cash generated in 2014 which is not funding the dividend program or the Capella acquisition, and cash generated in 2015 which is not funding the dividend program will continue to be reinvested outside of the United States indefinitely. Upon distribution of those earnings in the form of dividends or otherwise, we would be subject to U.S. income taxes (subject to an adjustment for foreign tax credits), state income taxes, incremental foreign income taxes, and withholding taxes payable to various foreign countries.
We expect to fund the quarterly dividend program initiated in 2014, by, at least in part, repatriating current year income of certain non-U.S. subsidiaries and providing appropriate U.S. federal and state income taxes, incremental foreign income taxes, and withholding taxes payable on that current period non-U.S. income.
Additionally, our substantially undrawn credit facility provides us with significant liquidity in the United States.
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 average 0.6% and are approximately 37 basis points higher than interest rates on our cash accounts. Transactions related to these investments are classified as investing activities on our consolidated statements of cash flows.
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The following table summarizes the components of net cash and short-term investments (debt) at April 4, 2015 and December 31, 2014 (in thousands):

|  | April 4, 2015 |  |  | December 31, 2014 |
Credit facility |  | $ | 215,000 |  |  | $ | 200,000 |
Exchangeable unsecured notes, due 2102 |  |  | 38,642 |  |  |  | 38,642 |
Convertible senior debentures, due 2040* |  |  | 104,297 |  |  |  | 103,841 |
Convertible senior debentures, due 2041* |  |  | 53,523 |  |  |  | 53,249 |
Convertible senior debentures, due 2042* |  |  | 59,443 |  |  |  | 59,190 |
Total debt |  |  | 470,905 |  |  |  | 454,922 |
Cash and cash equivalents |  |  | 517,002 |  |  |  | 592,172 |
Short-term investments |  |  | 539,046 |  |  |  | 514,776 |
Net cash and short-term investments (debt) |  | $ | 585,143 |  |  | $ | 652,026 |

*Represents the carrying amount of the convertible debentures, which is comprised of the principal amount of the debentures, net of the unamortized discount and the associated embedded derivative liability.
Measurements such as "free cash" and "net cash and short-term investments (debt)" do not have uniform definitions and are not recognized in accordance with GAAP. Such measures should not be viewed as alternatives to GAAP measures of performance or liquidity. However, 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, and that an analysis of "net cash and short-term investments (debt)" assists investors in understanding aspects of our cash and debt management. These measures, as calculated by us, may not be comparable to similarly titled measures used by other companies.
Our financial condition as of April 4, 2015 continued to be strong, with a current ratio (current assets to current liabilities) of 4.3 to 1, as compared to 4.2 to 1 as of December 31, 2014. The increase is primarily due to an increase in accounts receivable and a decrease in accounts payable. Our ratio of total debt to Vishay stockholders' equity was 0.27 to 1 at April 4, 2015 as compared to a ratio of 0.25 to 1 at December 31, 2014. The increase in the ratio is primarily due to borrowings under the credit facility.
Cash flows provided by operating activities were $13.5 million for the fiscal quarter ended April 4, 2015, as compared to cash flows provided by operations of $30.0 million for the fiscal quarter ended March 29, 2014. The decrease is primarily due to a larger increase in net working capital in the first fiscal quarter of 2015 versus the first fiscal quarter of 2014.
Cash paid for property and equipment for the fiscal quarter ended April 4, 2015 was $19.8 million, as compared to $19.3 million for the fiscal quarter ended March 29, 2014. We expect capital spending of approximately $160 million in 2015. Our expectation has been adjusted based on the current foreign currency exchange rates.
Cash paid for dividends to our common and Class B common stockholders totalled $8.9 million and $8.8 million for the fiscal quarters ended April 4, 2015 and March 29, 2014, respectively. We expect dividend payments in 2015 to total approximately $35.4 million. However, any future dividend declaration and payment remains subject to authorization by our Board of Directors.
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Contractual Commitments and Off-Balance Sheet Arrangements
Our Annual Report on Form 10-K for the year ended December 31, 2014 filed on February 19, 2015, includes a table of contractual commitments. There were no material changes to these commitments since the filing of our Annual Report on Form 10-K.
We do not participate in nor have we created any off-balance sheet variable interest entities or other off-balance sheet financing, other than the operating leases described in our Annual Report on Form 10-K for the year ended December 31, 2014.
Dividends
In 2014, our Board of Directors approved the initiation of a quarterly cash dividend program. Cash dividends of $0.06 per share of common stock and Class B common stock were paid in each quarter of 2014 and the first fiscal quarter of 2015. We expect to continue to pay quarterly dividends, although each dividend is subject to approval by our Board of Directors.
The following table summarizes the quarterly cash dividends declared (in thousands):

Fiscal Period | Amount |  | Month of Payment
Three fiscal months ended April 4, 2015 |  | $ | 8,854 |  | March

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; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; difficulties in new product development; changes in competition and technology in the markets that we serve and the mix of our products required to address these changes; an inability to attract and retain highly qualified personnel, particularly in respect of our acquired businesses; uncertainty related to the effects of changes in foreign currency exchange rates; difficulties in implementing our cost management strategies; and other factors affecting our operations, markets, 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 2014 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.
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Item 3. | Quantitative and Qualitative Disclosures About Market Risk

Part II, Item 7A, "Quantitative and Qualitative Disclosures About Market Risk," of our Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on February 19, 2015, describes our exposure to market risks. There have been no material changes to our market risks since December 31, 2014.

Item 4. | Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures
An evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report to ensure that information required to be disclosed in reports that we file or submit under the Exchange Act are: (1) recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms; and (2) accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION

Item 1. | Legal Proceedings

Item 3 of Part I of our Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on February 19, 2015, describes certain of our legal proceedings. There have been no material developments to the legal proceedings previously disclosed.

Item 1A. | Risk Factors

Except as set forth below, there have been no material changes to the risk factors we previously disclosed under Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on February 19, 2015.
The holders of our Class B common stock have effective voting control of our company.
We have two classes of common stock: common stock and Class B common stock. The holders of common stock are entitled to one vote for each share held, while the holders of Class B common stock are entitled to 10 votes for each share held. At April 4, 2015, the holders of Class B common stock held approximately 47.3% of the voting power of Vishay. The ownership of Class B common stock is highly concentrated, and holders of Class B common stock effectively can cause the election of directors and approve other actions as stockholders without the approval of our other stockholders. As a result of the passing of our founder and former Executive Chairman, Dr. Felix Zandman, Mrs. Ruta Zandman (a member of our Board of Directors) controls the voting of, solely or on a shared basis with Marc Zandman (our Executive Chairman) and Ziv Shoshani (a member of our Board of Directors) approximately 89.4% of our Class B common stock and 42.4% of the total voting power of our capital stock as of April 4, 2015.

Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3. | Defaults Upon Senior Securities

Not applicable.

Item 4. | Mine Safety Disclosures

Not applicable.

Item 5. | Other Information

Not applicable.
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Item 6. | Exhibits

10.1 | Vishay Intertechnology, Inc. Key Employee Wealth Accumulation Plan (as amended and restated, effective February 18, 2015). Incorporated by reference to Exhibit 10.47 our 2014 Annual Report on Form 10-K.
10.2 | Second Amendment to Compensation Matters Agreement, dated March 3, 2015, between Vishay Europe GmbH (an indirect wholly owned subsidiary of Vishay Intertechnology, Inc.) and Lori Lipcaman.
10.3 | Second Amendment to Compensation Matters Agreement, dated March 3, 2015, between Vishay Electronic GmbH (an indirect wholly owned subsidiary of Vishay Intertechnology, Inc.) and Dieter Wunderlich.
10.4 | Second Amendment to Terms and Conditions of Johan Vandoorn Employment Agreement, dated March 3, 2015.
10.5 | Second Amendment to Employment Agreement between Vishay Americas, Inc. (a wholly owned subsidiary of Vishay Intertechnology, Inc.) and David Valletta dated March 3, 2015.
31.1 | Certification pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Dr. Gerald Paul, Chief Executive Officer.
31.2 | Certification pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Lori Lipcaman, Chief Financial Officer.
32.1 | Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Dr. Gerald Paul, Chief Executive Officer.
32.2 | Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Lori Lipcaman, Chief Financial Officer.
101 | Interactive Data File (Quarterly Report on Form 10-Q, for the quarterly period ended April 4, 2015, furnished in XBRL (eXtensible Business Reporting Language)).

____________
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

| VISHAY INTERTECHNOLOGY, INC.
| /s/ Lori Lipcaman |
| Lori Lipcaman |
| Executive Vice President and Chief Financial Officer
| (as a duly authorized officer and principal financial and
| accounting officer)

Date: May 5, 2015
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