Note 15 - Business Unit Segment Information

12 Months Ended

Dec. 28, 2013

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

15. Business Unit Segment Information

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 Chief Executive Officer (“CEO”).

The company reports its operations by the following business unit segments: Electronics, Automotive and Electrical.

•   Electronics. Provides circuit protection components and expertise to leading global manufacturers of a wide range of electronic products including mobile phones, computers, LCD TVs, telecommunications equipment, medical devices, lighting products and white goods. The Electronics business segment has the broadest product offering in the industry including fuses and protectors, positive temperature coefficient (ìPTCî) resettable fuses, varistors, polymer electrostatic discharge (ìESDî) suppressors, discrete transient voltage suppression (ìTVSî) diodes, TVS diode arrays and protection thyristors, gas discharge tubes, power switching components and fuseholders, blocks and related accessories.

•   Automotive. Provides circuit protection products to the worldwide automotive original equipment manufacturers (ìOEMî) and parts distributors of passenger automobiles, trucks, buses and off-road equipment. The company also sells its fuses in the automotive replacement parts market. Products include blade fuses, high current fuses, battery cable protectors and varistors.

•   Electrical. Provides circuit protection products for industrial and commercial customers. Products include power fuses and other circuit protection devices that are used in commercial and industrial buildings and large equipment such as HVAC systems, elevators and machine tools.

Each of the operating segments 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 CEO allocates resources to and assesses the performance of each operating segment using information about its revenue and operating income (loss), 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, equity in loss of unconsolidated affiliate, or taxes to operating segments. Although the CEO uses operating income 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.

The company has provided this business unit segment information for all comparable prior periods. Segment information is summarized as follows (in thousands):

	2013			2012			2011
Net sales
Electronics	$	367,052		$	329,466		$	354,487
Automotive		267,207			206,222			197,586
Electrical		123,594			132,225			112,882
Total net sales	$	757,853		$	667,913		$	664,955
Depreciation and amortization
Electronics	$	20,735		$	20,741		$	22,324
Automotive		9,928			6,822			5,992
Electrical		3,817			3,870			3,936
Total depreciation and amortization	$	34,480		$	31,433		$	32,252
Operating income (loss)
Electronics	$	69,559		$	51,422		$	62,982
Automotive		39,170			29,817			30,002
Electrical		24,363			32,794			28,902
Other (1)		(3,211	)		(7,163	)		(7,982	)
Total operating income		129,881			106,870			113,904
Interest expense		2,917			1,701			1,691
Impairment and equity in net loss of unconsolidated affiliate (2)		10,678			7,334			—
Foreign exchange (gain) loss		(3,303	)		3,179			1,238
Other expense (income), net		(4,646	)		(5,396	)		(4,126	)
Income before income taxes	$	124,235		$	100,052		$	115,101

(1) Included in "Other" Operating income (loss) for 2013 are acquisition related fees ($1.7 million included in Selling, general and administrative expenses ("SG&A")) and non-cash charges for the sale of inventory that had been stepped-up to fair value at the acquisition date of Hamlin ($1.5 million included in Cost of sales ("COS")) (See Note 2).

Included in "Other" Operating income (loss) for 2012 are acquisition related fees ($1.0 million included in SG&A), non-cash charges for the sale of inventory that had been stepped-up to fair value at the acquisition date of Accel and Terra Power ($0.6 million included in COS), charges related to a pension liability settlement ($5.1 million included in SG&A) (see Note 12), and asset impairment charges related to the sale of the Dünsen, Germany facility ($0.5 million included in SG&A) (See Note 11).

Included in "Other" Operating income (loss) for 2011 are acquisition related fees ($1.0 million included in SG&A), a non-cash charge for the sale of inventory that had been stepped-up to fair value at the acquisition date of Cole Hersee ($3.7 million included in COS), asset impairment charges related to closure of the company’s Des Plaines, Illinois ($0.8 million), Dundalk, Ireland ($0.6 million) and Dünsen, Germany ($0.9 million) manufacturing facilities (all included in SG&A) (see Note 11) and purchase accounting adjustments related to the Selco acquisition ($0.7 million included in COS).

(2) During the first quarter of 2013, the company recorded approximately $10.7 million related to the impairment of Shocking Technologies. During the fourth quarter of 2012, the company recorded approximately $7.3 million related to the impairment and equity in net loss of its investment in Shocking Technologies (See Note 6).

The company’s significant net sales and long-lived assets by country for the fiscal years ended 2013, 2012 and 2011 are as follows (in thousands):

	2013		2012		2011
Net sales
United States	$	274,666	$	222,530	$	223,701
China		158,494		142,553		148,717
Other countries		324,693		302,830		292,537
Total net sales	$	757,853	$	667,913	$	664,955
Long-lived assets
United States	$	27,294	$	14,433	$	15,814
China		45,843		41,504		43,386
Canada		14,429		13,839		11,795
Other countries		62,607		51,135		47,889
Total long-lived assets	$	150,173	$	120,911	$	118,884

For the year ended December 28, 2013, approximately 64% of the company’s net sales were to customers outside the United States (exports and foreign operations) including 20% to China. No single customer accounted for more than 10% of net sales during the last three years.