Segment Information, Significant Customers, Export Sales and Geographical Information

12 Months Ended

Dec. 31, 2011

Segment Information, Significant Customers, Export Sales and Geographical Information

NOTE 11 - Segment Information, Significant Customers, Export Sales and Geographical Information

Reportable Segments

The following information relates to our reportable segments as of and for the year ended December 31, 2011(in thousands):

	Tii & Porta Copper Products   Division			Tii Fiber		Total
Net sales	$	54,113		$	2,145	$	56,258
Operating (loss) income		(3,857	)		126		(3,731	)
Interest expense		29			-		29
Depreciation and amortization		2,722			62		2,784
Capital expenditures		1,315			7		1,322
Total assets at December 31, 2011	$	46,904		$	420	$	47,324

Prior to the F2O acquisition in March 2011, there was only one reportable segment.

Significant Customers

The following customers accounted for 10% or more of our consolidated net sales during one or more of the periods presented below:

	Years ended December 31,
	2011			2010			2009
Customer A		14	%		18	%		34	%
Customer B		16	%		19	%		*
Customer C		20	%		14	%		14	%
Customer D		*			*			11	%

          * Amounts are less than 10%

As of December 31, 2011, each of two customers accounted for approximately 21% of accounts receivable. As of December 31, 2010, four customers accounted for approximately 15%, 14%, 14% and 13% of accounts receivable.

Export Sales

Export sales accounted for 35%, 43% and 19% of consolidated sales during the years ended December 31, 2011, 2010 and 2009, respectively. In 2011 and 2010, 16% and 19% of our consolidated sales, respectively, were to one customer in England.

Geographical Information

Our subsidiary in England maintains a sales office and warehouse in Daventry, England, which had net inventory and net fixed assets of approximately $596,000 and $2,000, respectively, at December 31, 2011. At December 31, 2010, this subsidiary had net inventory and net fixed assets of approximately $1,750,000 and $3,000, respectively.

Certain equipment owned by us is utilized by our contract manufacturer located in China and Mexico. The net book value of our equipment held by our contract manufacturer at December 31, 2011 and 2010 was approximately $2,696,000 and $3,460,000, respectively.

Significant Contract Manufacturers

On May 1, 2009, we renewed our agreement with our principal contract manufacturer, an independent U.S. based corporation with a wholly owned subsidiary located in China, to continue the manufacture and supply of applicable products to us through May 2015.

As discussed in Note 2, concurrent with our acquisition of the Porta Copper Products Division in May 2010, we sold the acquired Mexican subsidiary, exclusive of customer contracts and certain machinery and equipment which we retained, to our principal contract manufacturer, which is now operating the manufacturing facility. In connection with this sale, we entered into an agreement with our contract manufacturer to manufacture and supply product to us from this Mexico subsidiary through May 2016, after which this agreement will automatically renew for additional terms of one year, unless at least one year written notice of intent not to renew is given by either party.

In May 2000, we entered into a ten year agreement with a contract manufacturer in Malaysia to outsource the manufacturing of certain of our gas tubes used in our products, which expired in December 2010. Effective December 2010, we transitioned the sourcing of these products to our principal contract manufacturer in China.

Our principal contract manufacturer produces the majority of the products that we sell.