BUSINESS SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2012

BUSINESS SEGMENT INFORMATION [Abstract]

BUSINESS SEGMENT INFORMATION

12.           BUSINESS SEGMENT INFORMATION

The Company operates in one industry with three reportable operating segments, which are geographic in nature.  The segments consist of North America, Asia and Europe.  The primary criteria by which financial performance is evaluated and resources are allocated are revenues and operating income.  The following is a summary of key financial data (dollars in thousands):

	2012			2011			2010
Net Sales to External Customers:
North America	$	126,469		$	134,804		$	111,888
Asia		128,319			126,941			156,635
Europe		31,806			33,376			34,016
	$	286,594		$	295,121		$	302,539
Net Sales:
North America	$	138,966		$	149,114		$	125,383
Asia		167,756			177,815			196,243
Europe		33,329			34,597			35,150
Less intergeographic
revenues		(53,457	)		(66,405	)		(54,237	)
	$	286,594		$	295,121		$	302,539
Income (Loss) from Operations:
North America	$	1,336		$	9,026		$	4,181
Asia		(42	)		(3,480	)		9,357
Europe		411			1,850			1,622
	$	1,705		$	7,396		$	15,160
Total Assets:
North America	$	84,609		$	115,552		$	110,984
Asia		148,351			148,950			155,414
Europe		42,258			12,409			10,774
	$	275,218		$	276,911		$	277,172
Capital Expenditures:
North America	$	2,455		$	1,121		$	870
Asia		2,003			1,733			1,371
Europe		286			74			186
	$	4,744		$	2,928		$	2,427
Depreciation and Amortization Expense:
North America	$	4,081		$	4,046		$	3,862
Asia		4,076			4,137			4,513
Europe		915			484			461
	$	9,072		$	8,667		$	8,836

Net sales from external customers are attributed to individual operating segments based on the geographic source of the billing for such customer sales.  Transfers between geographic areas include finished products manufactured in foreign countries which are then transferred to the United States and Europe for sale; finished goods manufactured in the United States which are transferred to Europe and Asia for sale; and semi-finished components manufactured in the United States which are sold to Asia for further processing. Income from operations represents gross profit less operating expenses.

The following items are included in the income from operations presented above:

Restructuring Charges – During the year ended December 31, 2012, the Company incurred $5.2 million in restructuring costs related to the 2012 Restructuring Program.  Of this amount, $4.5 million related to the Company's North America operating segment, $0.6 million related to its Asia operating segment and $0.1 million related to the Company's Europe operating segment.  The amount incurred in North America primarily related to severance costs and impairment charges on property, plant and equipment related to the closure of its Vinita, Oklahoma manufacturing facility.  During 2011, the Company incurred restructuring costs of $0.3 million related to severance costs associated with the reorganization of its Cinch operations in the UK.

Litigation Charges – During the year ended December 31, 2011, the Company recorded $3.5 million of litigation charges related to the SynQor and Halo lawsuits.  During the year ended December 31, 2010, the Company recorded $8.1 million of litigation charges related to the SynQor lawsuit.  These charges impacted income from operations primarily within the Company's Asia reportable operating segment.

Loss on Disposal of Property, Plant and Equipment – During the year ended December 31, 2012, the Company recorded a $0.3 million loss on disposal of assets in its North America operating segment related to the damage caused by Hurricane Sandy at its Jersey City, New Jersey and Inwood, New York facilities.  This was partially offset by a $0.2 million pre-tax gain recorded in the Company's Asia operating segment from the sale of a building in Macau.   

Entity-Wide Information

The following is a summary of entity-wide information related to the Company's net sales to external customers by geographic area and by major product line (dollars in thousands).

	2012		2011		2010
Net Sales by Geographic Area:
United States	$	126,469	$	134,804	$	111,888
Macao		128,319		126,941		156,635
Germany		14,165		17,937		20,027
United Kingdom		13,203		11,927		10,747
Czech Republic		3,298		3,512		3,242
Italy		1,083		-		-
Sweden		57		-		-
Consolidated net sales	$	286,594	$	295,121	$	302,539
Net Sales by Major Product Line:
Interconnect	$	109,245	$	107,346	$	101,059
Magnetics		100,529		87,104		127,664
Modules		66,663		90,475		61,092
Circuit protection		10,157		10,196		12,724
Consolidated net sales	$	286,594	$	295,121	$	302,539

Net sales from external customers are attributed to individual countries based on the geographic source of the billing for such customer sales.

The following is a summary of long-lived assets by geographic area as of December 31, 2012 and 2011 (dollars in thousands):

	2012		2011
Long-lived Assets by Geographic Location:
United States	$	27,552	$	30,204
People's Republic of China (PRC)		16,622		18,611
All other foreign countries		3,324		2,553
Consolidated long-lived assets	$	47,498	$	51,368

Long-lived assets consist of property, plant and equipment, net and other assets of the Company that are identified with the operations of each geographic area.

The territory of Hong Kong became a Special Administrative Region ("SAR") of the PRC in the middle of 1997. The territory of Macao became a SAR of the PRC at the end of 1999. Management cannot presently predict what future impact this will have on the Company, if any, or how the political climate in the PRC will affect the Company's contractual arrangements in the PRC.  A significant portion of the Company's manufacturing operations and approximately 43% of its identifiable assets are located in Asia.

Net Sales to Major Customers

The Company had sales to two customers in excess of ten percent of consolidated net sales in 2012.  The combined revenue from these two customers was $70.6 million during the year ended December 31, 2012, representing 24.6% of total sales.  In 2011, there were two customers with sales in excess of ten percent of consolidated net sales.  The combined revenue from these two customers was $65.7 million during the year ended December 31, 2011, representing 22.3% of total sales.  In 2010, the Company had sales to two customers in excess of ten percent of consolidated net sales.  The combined revenue from these two customers was $74.6 million during the year ended December 31, 2010, representing 24.7% of total sales.  Sales related to these significant customers were primarily reflected in the North America and Asia operating segments during each of the three years discussed.