Market Concentrations and Risks

12 Months Ended

Dec. 31, 2012

Market Concentrations and Risks

Note 20: Market Concentrations and Risks

Concentrations of Credit

We sell our products to many customers in several markets across multiple geographic areas. The ten largest customers, of which seven are distributors, constitute in aggregate approximately 34%, 34%, and 31% of revenues in 2012, 2011, and 2010, respectively.

Unconditional Copper Purchase Obligations

At December 31, 2012, we were committed to purchase approximately 1.5 million pounds of copper at an aggregate cost of $5.4 million. At December 31, 2012, the fixed cost of this purchase was $0.2 million under the market cost that would be incurred on a spot purchase of the same amount of copper. The aggregate market cost was based on the current market price of copper obtained from the New York Mercantile Exchange. These commitments will mature in 2013.

Labor

Approximately 24% of our labor force is covered by collective bargaining agreements at various locations around the world. Approximately 20% of our labor force is covered by collective bargaining agreements that we expect to renegotiate during 2013.

International Operations

The carrying amounts of net assets belonging to our international operations were as follows:

	December 31,
	2012		2011
	(In thousands)
Canada and Latin America	$	131,974	$	47,274
Europe, Africa and Middle East		43,286		51,050
Asia Pacific		205,424		221,040

Fair Value of Financial Instruments

Our financial instruments consist primarily of cash and cash equivalents, trade receivables, trade payables, and debt instruments. The carrying amounts of cash and cash equivalents, trade receivables, and trade payables at December 31, 2012 are considered representative of their respective fair values. The carrying amount of our debt instruments at December 31, 2012 was $1,151.2 million. The fair value of our senior subordinated notes at December 31, 2012 and 2011 was approximately $725.2 million and $561.4 million, respectively, based on quoted prices of the debt instruments in inactive markets (Level 2 valuation). This amount represents the fair values of our senior subordinated notes with a carrying value of $705.2 million and $550.9 million as of December 31, 2012 and 2011, respectively. We believe the fair values of our variable rate Term Loan and the amounts outstanding under our revolving credit agreement approximate book value.