Note 16 Business Segment, Geographic and Customer Information

12 Months Ended

Sep. 29, 2012

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

Business Segment, Geographic and Customer Information

ASC Topic 280, Segment Reporting, establishes standards for reporting information about operating segments, products and services, geographic areas of operations and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker or decision making group in deciding how to allocate resources and in assessing performance.

Prior to the fourth quarter of 2012, the Company was managed as a single business - Electronic Manufacturing Services. Effective in the fourth quarter of 2012, the Company decided to change the way it managed the business in order to place more emphasis on components, products and services requiring advanced technologies and / or addressing mission-critical applications. As a result, the Company's operations are managed as two businesses:

1) Integrated Manufacturing Solutions (IMS), which is a single operating segment consisting of printed circuit board assembly and test, optical and RF (Radio Frequency) modules, final system assembly and test, and direct order fulfillment.

2) Components, Products and Services (CPS), consisting of Components, which includes interconnect systems (printed circuit board fabrication and backplane and cable assemblies) and mechanical systems (enclosures, precision machining and plastic injection molding); Products, which includes memory and SSD products from Viking Technology; products from SCI Technology for use in the defense and aerospace industry and storage products from Newisys; and Services, which includes design, engineering, logistics and repair services.

The Company evaluated its operating segments to determine whether they can be aggregated into reportable segments. Factors considered in this evaluation were similarity regarding economic characteristics, products, production processes, type or classes of customers, distribution methods and regulatory environments. Based on this evaluation, the Company determined that it has only one reportable segment - IMS, which generated 81% of the Company's net sales in 2012. The Company's CPS business consists of multiple operating segments which do not meet the quantitative threshold for being presented as reportable segments. Therefore, financial information for these operating segments will be presented in a single category entitled “Components, Products and Services (CPS)”.

The Company's chief operating decision maker is the Chief Executive Officer and Chief Financial Officer and they allocate resources and assess performance of operating segments based on a non-GAAP measure of revenue and gross profit that excludes items not directly related to the Company's ongoing business operations. These items are typically either non-recurring or non-cash in nature.

The accounting policies for each segment are the same as those disclosed by the Company for its consolidated financial statements. Intersegment sales consist primarily of sales of components to IMS.

The following table presents information for the following fiscal years:

	Year Ended
	September 29, 2012			October 1, 2011			October 2, 2010
	(In thousands)
Gross sales:
IMS	$	4,975,156		$	5,349,225		$	5,021,818
CPS	1,259,052			1,405,833			1,431,533
Intersegment revenue	(140,874		)	(152,647		)	(134,660		)
Net Sales	$	6,093,334		$	6,602,411		$	6,318,691
Gross Profit:
IMS	$	327,094		$	374,763		$	377,099
CPS	113,621			137,854			115,350
Total	440,715			512,617			492,449
Unallocated items (1)	(4,933		)	(2,266		)	(9,459		)
Total	$	435,782		$	510,351		$	482,990
Depreciation and amortization:
IMS	$	54,815		$	57,229		$	48,309
CPS	35,537			34,220			31,684
Total	90,352			91,449			79,993
Unallocated corporate items (2)	9,125			13,122			9,580
Total	$	99,477		$	104,571		$	89,573
Capital expenditures:
IMS	$	39,962		$	57,478		$	68,449
CPS	40,150			36,844			29,578
Total	80,112			94,322			98,027
Unallocated corporate items (2)	1,787			3,751			6,214
Total	$	81,899		$	98,073		$	104,241

(1) Represents amounts associated with items that management excludes from its measure of gross profit. These items include stock-based compensation expense, amortization of intangible assets, charges or credits resulting from distressed customers and similar items that either occur infrequently or are of a non-operational nature.

(2) Primarily related to selling, general and administration functions.

	As of
	September 29, 2012		October 1, 2011
	(In thousands)
Long-lived assets (including assets held for sale):
IMS	$	330,585	$	327,783
CPS	194,646		189,414
Total	525,231		517,197
Unallocated corporate items (1)	54,346		84,825
Total	$	579,577	$	602,022

(1) Primarily related to selling, general and administration functions.

Information by geographic segment, determined based on the country in which a product is manufactured or a service is provided, was as follows:  

	Year Ended
	September 29, 2012			October 1, 2011			October 2, 2010
	(In thousands)
Net sales:
Domestic	$	1,106,446		$	1,199,077		$	1,324,856
Mexico	1,296,690			1,273,583			1,259,230
China	1,667,095			1,792,933			1,805,395
Other international	2,023,103			2,336,818			1,929,210
Total	$	6,093,334		$	6,602,411		$	6,318,691
Percentage of net sales represented by ten largest customers	49.7		%	49.9		%	49.9		%
Number of customers representing 10 % or more of net sales	1			1			1

	As of
	September 29, 2012		October 1, 2011
	(In thousands)
Long-lived assets (including assets held for sale):
Domestic	$	163,443	$	170,264
Mexico	119,032		111,964
China	89,175		89,111
Other international	207,927		230,683
Total	$	579,577	$	602,022