Reportable Business Segments

6 Months Ended

Jun. 30, 2014

Reportable Business Segments

Reportable Business Segments

Note 4—Reportable Business Segments

The Company has two reportable business segments: (i) Interconnect Products and Assemblies and (ii) Cable Products and Solutions. We aggregate our operating segments into reportable segments based upon similar economic characteristics and business groupings of products, services and customers. The Interconnect Product and Assemblies segment designs, manufactures and markets a broad range of connector and connector systems, value-added products and other products, including antennas and sensors, used in a broad range of applications in a diverse set of end markets.  The Cable Products and Solutions segment designs, manufactures and markets cable, value-added products and components for use primarily in the broadband communications and information technology markets as well as certain applications in other markets.  The accounting policies of the segments are the same as those for the Company as a whole and are described in Note 1 of the notes to the consolidated financial statements in the Company’s 2013 Annual Report. The Company evaluates the performance of business units on, among other things, profit or loss from operations before interest, headquarters’ expense allocations, stock-based compensation expense, income taxes, amortization related to certain intangible assets and nonrecurring gains and losses.

The segment results for the three months ended June 30, 2014 and 2013 are as follows:

	Interconnect Products and Assemblies				Cable Products and Solutions				Total
	2014		2013		2014		2013		2014		2013
Net sales:
-External	$	1,222,326	$	1,045,751	$	91,846	$	90,316	$	1,314,172	$	1,136,067
-Inter-segment	1,570		1,461		6,378		4,543		7,948		6,004
Segment operating income	264,292		230,082		11,691		12,443		275,983		242,525

The segment results for the six months ended June 30, 2014 and 2013 are as follows:

	Interconnect Products and Assemblies				Cable Products				Total
	2014		2013		2014		2013		2014		2013
Net sales
-External	$	2,381,436	$	2,041,677	$	178,810	$	174,195	$	2,560,246	$	2,215,872
-Inter-segment	2,684		2,755		11,717		9,810		14,401		12,565
Segment operating income	507,025		443,383		22,272		24,043		529,297		467,426

A reconciliation of segment operating income to consolidated income before income taxes for the three and six months ended June 30, 2014 and 2013 is summarized as follows:

	Three months endedJune 30,						Six months endedJune 30,
	2014			2013			2014			2013
Segment operating income	$	275,983		$	242,525		$	529,297		$	467,426
Interest expense	(20,081		)	(15,621		)	(39,152		)	(31,078		)
Interest income	4,725			3,391			9,170			6,486
Stock-based compensation expense	(9,973		)	(8,890		)	(19,249		)	(17,175		)
Acquisition-related expenses	—			—			(2,020		)	—
Other costs, net	(10,632		)	(9,980		)	(20,895		)	(19,949		)
Income before income taxes	$	240,022		$	211,425		$	457,151		$	405,710