XML 38 R25.htm IDEA: XBRL DOCUMENT v3.22.4
Segment Information
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Segment Information Segment Information
 
The Company and its subsidiaries design, manufacture and sell component, modules and subassemblies to empower the long-term structural themes of sustainability, connectivity and safety. The Company reports its operations by the following segments: Electronics, Transportation, and Industrial. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, and about which separate financial information is regularly evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. The CODM is the Company’s President and Chief Executive Officer (“CEO”). The CODM allocates resources to and assesses the performance of each operating segment using information about its revenue and operating income (loss) before interest and taxes, but does not evaluate the operating segments using discrete balance sheet information.
 
Sales, marketing, and research and development expenses are charged directly into each operating segment. Purchasing, logistics, customer service, finance, information technology, and human resources are shared functions that are allocated back to the three operating segments. The Company does not report inter-segment revenue because the operating segments do not record it.  Certain expenses, determined by the CODM to be strategic in nature and not directly related to segments current results, are not allocated but identified as “Other”. Additionally, the Company does not allocate interest and other income, interest expense, or taxes to operating segments. These costs are not allocated to the segments, as management excludes such costs when assessing the performance of the segments. Although the CODM uses operating income (loss) to evaluate the segments, operating costs included in one segment may benefit other segments. Except as discussed above, the accounting policies for segment reporting are the same as for the Company as a whole.
 
•Electronics Segment: Consists of one of the broadest product offerings in the industry, including fuses and fuse accessories, positive temperature coefficient (“PTC”) resettable fuses, electromechanical switches and interconnect solutions, polymer electrostatic discharge (“ESD”) suppressors, varistors, reed switch based magnetic sensing, gas discharge tubes; semiconductor products such as discrete transient voltage suppressor (“TVS”) diodes, TVS diode arrays, protection and switching thyristors, silicon and silicon carbide metal-oxide-semiconductor field effect transistors (“MOSFETs”) and diodes; and insulated gate bipolar transistors (“IGBT”) technologies. The segment covers a broad range of end markets, including industrial motor drives and power conversion, automotive electronics, electric vehicle and related charging infrastructure, aerospace, power supplies, data centers and telecommunications, medical devices, alternative energy and energy storage, building and home automation, appliances, and mobile electronics.

•Transportation Segment: Formerly known as Automotive segment. The term “Transportation” represents a more comprehensive description of the Company’s broad range of products, and the applications and end markets it serves. Consists of a wide range of circuit protection, power control and sensing technologies for global original equipment manufacturers (“OEMs”), Tier-one suppliers and parts and aftermarket distributors in passenger vehicle, heavy-duty truck, off-road vehicle, material handling, agricultural, construction and other commercial vehicle end markets. Passenger vehicle products are used in internal combustion engine, hybrid and electric vehicles including blade fuses, battery cable protectors, resettable fuses, high-current fuses, high-voltage fuses, and sensor products designed to monitor the occupant’s safety and environment as well as the vehicle’s powertrain. Commercial vehicle products include fuses, switches, circuit breakers, relays, and power distribution modules and units used in applications serving a number of end markets, including heavy-duty truck, construction, agriculture, material handling and marine.

•Industrial Segment: Consists of industrial circuit protection (industrial fuses), industrial controls (protection relays, contactors, and transformers) and temperature sensors for use in various applications such as renewable energy and energy storage systems, electric vehicle infrastructure, HVAC systems, industrial safety, non-residential construction, MRO, mining and industrial automation.

The Company has provided this segment information for all comparable prior periods. Segment information is summarized as follows:
 
(in thousands)
202220212020
Net sales   
Electronics$1,492,819 $1,300,744 $937,762 
Transportation716,140 528,058 395,764 
Industrial304,938 251,126 112,169 
Total net sales$2,513,897 $2,079,928 $1,445,695 
Depreciation and amortization
Electronics$68,195 $61,512 $62,702 
Transportation43,756 29,015 28,995 
Industrial8,755 8,108 4,481 
Total depreciation and amortization$120,706 $98,635 $96,178 
Operating income (loss)
Electronics$431,616 $309,633 $152,695 
Transportation63,539 65,979 41,655 
Industrial48,853 22,621 11,996 
Other(a)
(43,182)(12,591)(43,974)
Total operating income500,826 385,642 162,372 
Interest expense26,216 18,527 21,077 
Foreign exchange loss (gain)24,359 17,158 (14,875)
Other expense (income), net7,207 8,932 (5,083)
Income before income taxes$443,044 $341,025 $161,253 

(a) Included in “Other” Operating income (loss) for 2022 was $17.6 million of legal and professional fees and other integration expenses related to completed and contemplated acquisitions, $15.6 million of purchase accounting inventory step-up charges, and $10.0 million of restructuring, impairment and other charges, primarily related to employee termination costs and a $2.9 million non-cash impairment charge for certain acquired technology and patent intangible assets due to a change in use and projected cash flows within the Electronics segment in the fourth quarter of 2022. See Note 8, Restructuring, Impairment and Other Charges, for further discussion.

Included in “Other” Operating income (loss) for 2021 was $8.4 million of purchase accounting inventory step-up charges, $7.0 million of legal and professional fees and other integration expenses related to Carling, Hartland and other contemplated acquisitions, and $2.2 million of restructuring, impairment and other charges, primarily related to employee termination costs. See Note 8, Restructuring, Impairment and Other Charges, for further discussion. In addition, there was a gain of $5.0 million recorded for the sale of buildings within the Electronics segment.

Included in “Other” Operating income (loss) for 2020 is $2.3 million of acquisition-related and integration charges related to the IXYS acquisition and other contemplated acquisitions. In addition, there were $41.7 million of restructuring, impairment and other charges, primarily related to the goodwill impairment charge of $33.8 million recorded in the second quarter associated with the automotive sensors reporting unit within the Transportation segment, employee termination costs of $5.5 million, $2.2 million of impairment charges recorded in the first quarter associated with the announced consolidation of a manufacturing facility within the Industrial segment and other restructuring charges of $0.2 million.

The Company’s net sales, long-lived assets and additions to long-lived assets by country for the fiscal years ended 2022, 2021, and 2020 are as follows:
 
(in thousands)
202220212020
Net sales   
U.S.$912,498 $639,381 $392,544 
China638,978 620,211 438,000 
Other countries(a)
962,421 820,336 615,151 
Total net sales$2,513,897 $2,079,928 $1,445,695 
Long-lived assets
U.S.$76,325 $57,923 $46,132 
China129,094 122,867 85,876 
Mexico107,119 107,283 70,125 
Germany39,635 39,055 37,976 
Philippines77,240 74,918 66,994 
Other countries51,697 35,843 37,075 
Total long-lived assets$481,110 $437,889 $344,178 
Additions to long-lived assets
U.S.$14,603 $7,690 $4,170 
China35,297 26,396 10,074 
Mexico26,514 28,707 9,977 
Germany5,255 8,519 5,600 
Philippines14,847 19,342 19,612 
Other countries7,678 5,654 1,775 
Total additions to long-lived assets$104,194 $96,308 $51,208 

(a)Each country included in other countries are less than 10% of net sales.
 
For the year ended December 31, 2022, approximately 64% of the Company’s net sales were to customers outside the U.S. (exports and foreign operations), including approximately 25% to China. For the year ended January 1, 2022, approximately 69% of the Company's net sales were to customers outside the U.S. (exports and foreign operations), including approximately 30% to China. For the year ended December 26, 2020, approximately 73% of the Company's net sales were to customers outside the U.S. (exports and foreign operations), including approximately 30% to China. Sales to Arrow Electronics, Inc., which were included in the Electronics, Transportation, and Industrial segments, were 11.5%, 10.7%, and 10.4% of consolidated net sales in 2022, 2021, and 2020 respectively. No other single customer accounted for more than 10% of net sales during the last three years.