. Segment Information

The Company and its subsidiaries design, manufacture and sell components and modules for circuit protection, power control and sensing throughout the world. The Company reports its operations by the following segments: Electronics, Automotive, 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. Manufacturing, 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

: Provides circuit protection components for overcurrent and overvoltage protection, as well as sensor components and modules to leading global manufacturers of a wide range of electronic products. The segment covers a broad range of end markets, including consumer electronics, telecommunications equipment, medical devices, lighting products, and white goods. The Electronics segment supplies circuit protection, sensing and control products to various leading manufacturers. The Electronics segment has

one

of the broadest product offerings in the industry including fuses and protectors, positive temperature coefficient (“PTC”) resettable fuses, varistors, polymer electrostatic discharge (“ESD”) suppressors, discrete TVS diodes, TVS diode arrays protection and switching thyristors, gas discharge tubes, power switching components, fuseholders, reed switch and sensor assemblies, IGBT blocks, and related accessories.

●

Automotive

Segment

Provides circuit protection and sensor products to the worldwide automotive original equipment manufacturers (“OEM”) and parts distributors of passenger automobiles, trucks, buses, and off-road equipment. In addition, the Company supplies heavy duty power distribution modules, switches and relays to the commercial vehicle industry. The Company also sells its fuses, including blade fuses and high current fuses, battery cable protectors, and varistors, in the automotive replacement parts market. The Company also supplies wiring harness manufacturers and auto parts suppliers worldwide.

●

Industrial

Segment

Provides circuit protection products for industrial and commercial customers. Products include power fuses and other circuit protection devices, including protection and time delay relays, which are used in commercial and industrial buildings and large equipment such as HVAC systems, elevators, and machine tools. The Company also supplies industrial ground fault protection in mining and other large industrial operations.

Segment information is summarized as follows:

	For the Three Months Ended
(in thousands )	April 1, 2017			April 2, 2016
Net sales
Electronics	$	153,767		$	98,796
Automotive		107,839			91,933
Industrial		23,835			28,669
Total net sales	$	285,441		$	219,398

Depreciation and amortization
Electronics	$	8,387		$	5,372
Automotive		5,371			3,266
Industrial		1,314			1,451
Other		—			937
Total depreciation and amortization	$	15,072		$	11,026

Operating income (loss)
Electronics	$	35,206		$	22,416
Automotive		15,065			17,491
Industrial		106			1,673
Other (a)		(1,525	)		(9,152	)
Total operating income		48,852			32,428
Interest expense		3,120			2,045
Foreign exchange loss (gain)		(1,557	)		3,823
Other expense (income), net		(139	)		(517	)
Income before income taxes	$	47,428		$	27,077

(a) For the

first

quarter of

2017,

“Other” Operating income (loss) of

$1.5

million consists of acquisition and integration costs associated with the Company’s

2016

acquisitions (included in Cost of sales (“COS”) and Selling, general, and administrative expenses (“SG&A)).

For the

first

quarter of

2016,

“Other” Operating income (loss) of

$9.2

million consists of: (i)

$1.4

million of internal reorganization costs with

$1.1

million included in COS and

$0.3

million included in SG&A, (ii)

$6.2

million of acquisition related expenses included in SG&A, and (iii)

$1.6

million of impairment and severance costs related to the planned shut-down of the Company’s Roskilde, Denmark operations with

$0.2

million included in COS,

$0.9

million included in amortization of intangibles,

$0.3

million included in research and development, and

$0.2

million included in SG&A.

The Company’s net sales by country are as follows:

	For the Three Months Ended
(in thousands )	April 1, 2017		April 2, 2016
Net sales
United States	$	86,658	$	85,149
China		74,690		48,509
Other countries		124,093		85,740
Total net sales	$	285,441	$	219,398

The Company’s long-lived assets by country, as of

April

2017

and

December

31,

2016,

are as follows:

(in thousands )	April 1, 2017		December 31 , 2016
Long-lived assets
United States	$	23,770	$	23,731
China		65,073		65,345
Mexico		58,111		52,262
Philippines		32,615		33,345
Other countries		44,373		42,492
Total long-lived assets	$	223,942	$	217,175

The Company’s additions to long-lived assets by country are as follows:

	For the Three Months Ended
(in thousands )	April 1, 2017		April 2, 2016
Additions to long-lived assets
United States	$	332	$	1,618
China		2,341		1,046
Mexico		6,978		4,653
Philippines		855		1,101
Other countries		1,871		721
Total additions to long-lived assets	$	12,377	$	9,139