Note 13 - Business Unit Segment Information

9 Months Ended

Sep. 29, 2012

Segment Reporting Disclosure [Text Block]

13. Business Unit Segment Information

The company and its subsidiaries design, manufacture and sell circuit protection devices throughout the world. The company reports its operations by the following business unit segments: Electronics, Automotive, and Electrical. Each operating segment is directly responsible for sales, marketing and research and development. Manufacturing, purchasing, logistics, customer service, finance, information technology and human resources are shared functions that are allocated back to the three operating segments. The Chief Executive Officer (“CEO”) allocates resources to and assesses the performance of each operating segment using information about its revenue and operating income (loss) before interest and taxes inclusive of depreciation and amortization, but does not evaluate the operating segments using discrete balance sheet information.

Sales, marketing and research and development expenses are charged directly into each operating segment. All other functions are shared by the operating segments and expenses for these shared functions are allocated to the operating segments and included in the operating results reported below. The company does not report inter-segment revenue because the operating segments do not record it. The company does not allocate interest and other income, interest expense, or taxes to operating segments. Although the CEO uses operating income (loss) to evaluate the segments, operating costs included in one segment may benefit other segments. Except as discussed above, the accounting policies for segment reporting are the same as for the company as a whole.

An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, and about which separate financial information is regularly evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. The CODM is the company's President and CEO.

Business unit segment information for the three and nine months ended September 29, 2012 and October 1, 2011 are summarized as follows (in thousands):

	For the Three Months Ended						For the Nine Months Ended
	September 29, 2012			October 1, 2011			September 29, 2012			October 1, 2011
Net sales
Electronics	$	87,779		$	96,288		$	254,342		$	282,032
Automotive		51,878			47,703			155,954			151,957
Electrical		33,031			29,996			98,823			83,773
Total net sales	$	172,688		$	173,987		$	509,119		$	517,762
Depreciation and amortization
Electronics	$	5,115		$	5,940		$	15,713		$	16,616
Automotive		1,911			1,442			4,862			4,481
Electrical		943			923			2,911			2,713
Total depreciation and amortization	$	7,969		$	8,305		$	23,486		$	23,810
Operating income (loss)
Electronics	$	17,186		$	18,610		$	43,075		$	56,974
Automotive		7,018			6,456			23,489			24,580
Electrical		8,235			7,472			23,795			21,467
Other(a)		(1,508	)		(2,964	)		(1,508	)		(7,238	)
Total operating income		30,931			29,574			88,851			95,783
Interest expense		454			414			1,298			1,271
Other (income) expense, net		(516	)		(1,897	)		(1,172	)		(1,934	)
Income before income taxes	$	30,993		$	31,057		$	88,725		$	96,446

(a) Included in “Other” operating income for the three and nine months ended September 29, 2012 are acquisitions related fees of $0.6 million, impairment charges of $0.5 million as described in Note 10, and a non-cash charge of $0.4 million for the sale of inventory that had been stepped-up to fair value at the acquisition date of Accel as required by purchase accounting rules. As the inventory was sold, the non-cash charge impacted operating income. Included in “Other” operating income for the three and nine months ended October 1, 2011 are asset impairment charges of $2.3 million. Included in “Other” operating income for the nine months ended October 1, 2011 are acquisition related fees of $1.0 million and a non-cash charge of $3.7 million for the sale of inventory that had been stepped-up to fair value at the acquisition date of Cole Hersee in 2010 as required by purchase accounting rules. As the inventory was sold, the non-cash charge impacted operating income.

The company's significant net sales by country for the three and nine months ended September 29, 2012 and October 1, 2011 are summarized as follows (in thousands):

	For the Three Months Ended(a)				For the Nine Months Ended(a)
	September 29, 2012		October 1, 2011		September 29, 2012		October 1, 2011
United States	$	56,043	$	56,225	$	170,653	$	174,895
China		39,282		41,159		107,409		116,694
Other countries		77,363		76,603		231,057		226,173
Total	$	172,688	$	173,987	$	509,119	$	517,762

(a)Net sales by country represent sales to customer or distributor locations.

The company's significant long-lived assets by country as of September 29, 2012 and December 31, 2011 are summarized as follows (in thousands):

	Long-lived assets(b)
	September 29, 2012		December 31, 2011
United States	$	98,603	$	92,482
China		42,075		45,466
Canada		43,506		42,299
Other countries		117,698		98,917
Total	$	301,882	$	279,164

(b) Long-lived assets include net property, plant and equipment, intangible assets, net of amortization, and goodwill.