Segment Information

9 Months Ended

Sep. 30, 2011

Segment Information [Abstract]

Segment Information

13. Segment Information

The Company currently operates under four business segments: SL Power Electronics Corp. (“SLPE”), the High Power Group, SL Montevideo Technology, Inc. (“SL-MTI”) and RFL Electronics Inc. (“RFL”). Teal Electronics Corp. (“Teal”) and MTE Corporation (“MTE”) are combined into one business segment, which is reported as the High Power Group. Management has combined SLPE and the High Power Group into one business unit classified as the Power Electronics Group. The Company aggregates operating business subsidiaries into a single segment for financial reporting purposes if aggregation is consistent with the objectives of ASC 280 “Segment Reporting.” Business units are also combined if they have similar characteristics in each of the following areas:

• nature of products and services

• nature of production process

• type or class of customer

• methods of distribution

SLPE produces a wide range of custom and standard internal and external AC/DC and DC/DC power supply products to be used in customers’ end products. The Company’s power supplies closely regulate and monitor power outputs, resulting in stable and highly reliable power. SLPE, which sells products under three brand names (SL Power Electronics, Condor and Ault), is a major supplier to the original equipment manufacturers (“OEMs”) of medical, wireless and wire line communications infrastructure, computer peripherals, military, handheld devices and industrial equipment. The High Power Group sells products under two brand names (Teal and MTE). Teal designs and manufactures custom power conditioning and distribution units. Products are developed and manufactured for custom electrical subsystems for OEMs of semiconductor, medical imaging, military and telecommunication systems. MTE designs and manufactures power quality electromagnetic products used to protect equipment from power surges, bring harmonics into compliance and improve the efficiency of variable speed motor drives. SL-MTI designs and manufactures high power density precision motors. New motor and motion controls are used in numerous applications, including military and commercial aerospace equipment, medical devices and industrial products. RFL designs and manufactures communication and power protection products/systems that are used to protect utility transmission lines and apparatus by isolating faulty transmission lines from a transmission grid. The Other segment includes corporate related items, financing activities and other costs not allocated to reportable segments, which includes but is not limited to certain legal, litigation and public reporting charges and certain legacy costs. The accounting policies for the business units are the same as those described in the summary of significant accounting policies. For additional information, see Note 1 of the Notes to the Consolidated Financial Statements included in Part IV of the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.

Business segment operations are conducted through domestic subsidiaries. For all periods presented, sales between business segments were not material. Each of the segments has certain major customers, the loss of any of which would have a material adverse effect on such segment.

The unaudited comparative results for the three-month periods and nine-month periods ended September 30, 2011 and September 30, 2010 are as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	(in thousands)
Net sales
Power Electronics Group:
SLPE	$	24,314	$	20,969	$	68,620	$	58,402
High Power Group		14,057		14,719		48,943		41,054
Total		38,371		35,688		117,563		99,456
SL-MTI		8,498		8,044		26,916		22,914
RFL		5,223		5,409		16,473		16,694
Consolidated	$	52,092	$	49,141	$	160,952	$	139,064

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
	(in thousands)
Income (loss) from operations
Power Electronics Group:
SLPE	$	1,954		$	2,153		$	6,324		$	4,527
High Power Group		1,086			1,422			5,584			3,665
Total		3,040			3,575			11,908			8,192
SL-MTI		1,361			1,206			4,612			3,236
RFL		639			570			1,972			2,286
Other		(1,502	)		(2,181	)		(4,301	)		(5,037	)
Consolidated	$	3,538		$	3,170		$	14,191		$	8,677

Total assets as of September 30, 2011 and December 31, 2010 are as follows:

	September 30,		December 31,
	2011		2010
	(in thousands)
Total assets
Power Electronics Group:
SLPE	$	40,582	$	37,155
High Power Group		31,690		31,539
Total		72,272		68,694
SL-MTI		12,215		11,262
RFL		14,289		14,525
Other		11,051		10,418
Consolidated	$	109,827	$	104,899

Goodwill and intangible assets, net, as of September 30, 2011 and December 31, 2010 are as follows:

	September 30,		December 31,
	2011		2010
	(in thousands)
Goodwill and intangible assets, net
Power Electronics Group:
SLPE	$	4,786	$	5,067
High Power Group		15,948		16,328
Total		20,734		21,395
SL-MTI		—		—
RFL		5,427		5,373
Consolidated	$	26,161	$	26,768