SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED March 30, 2002 OR
TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM TO
------------- --------------
Commission file number 0-20388
LITTELFUSE, INC.
---- ----------------
(Exact name of registrant as specified in its charter)
DELAWARE 36-3795742
- --------------------------------- ------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
800 EAST NORTHWEST HIGHWAY
DES PLAINES, ILLINOIS 60016
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(847) 824-1188
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes X No
---- ----
As of March 30, 2002, 21,940,047 shares of common stock, $.01 par value,
of the Registrant were outstanding.
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
PAGE
----
Item 1. Financial Statements
Condensed Consolidated Statements of Operations for the three months ended
March 30, 2002 and March 31, 2001............................................................1
Condensed Consolidated Balance Sheets as of March 30, 2002
and December 29, 2001........................................................................2
Condensed Consolidated Statements of Cash Flows for the three months
ended March 30, 2002 and March 31, 2001
.............................................................................................3
Notes to Condensed Consolidated Financial Statements.........................................4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations ..............................................6
Item 3. Qualitative and Quantitative Disclosures about Market Risk ................................11
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K............................................................12
LITTELFUSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
For the Three Months Ended
MARCH 30, March 31,
2002 2001
-------- --------
Net sales ................................................ $ 65,130 $ 75,590
Cost of sales ............................................ 45,105 48,655
-------- --------
Gross profit ............................................. 20,025 26,935
Selling, general and administrative expenses ............. 14,909 16,944
Research and development expenses ........................ 2,022 2,673
Amortization of intangibles .............................. 192 1,623
Restructuring expense .................................... 3,744 --
-------- --------
Operating income (loss) .................................. (842) 5,695
Interest expense ......................................... 716 931
Other income ............................................. (601) (106)
-------- --------
Income (loss) before income taxes ........................ (957) 4,870
Income tax expense (benefit) ............................. (345) 1,754
-------- --------
Net income (loss) ........................................ $ (612) $ 3,116
======== ========
Net income (loss) per share:
Basic ................................................ $ (0.03) $ 0.16
======== ========
Diluted .............................................. $ (0.03) $ 0.14
======== ========
Weighted average shares and equivalent shares outstanding:
Basic ................................................ 21,877 19,794
======== ========
Diluted .............................................. 21,877 21,689
======== ========
1
LITTELFUSE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
MARCH 30, December 29,
2002 2001
----------- ----------
(unaudited)
ASSETS:
Cash and cash equivalents ............................. $ 34,097 $ 34,527
Receivables, net ...................................... 44,312 40,969
Inventories, net ...................................... 44,927 46,208
Other current assets .................................. 16,611 14,478
-------- --------
Total current assets .................................. $139,947 $136,182
Property, plant, and equipment, net ................... 83,108 86,601
Reorganization value, net ............................. 28,066 28,066
Other intangible assets, net .......................... 20,262 20,455
Other assets .......................................... 1,526 968
-------- --------
$272,909 $272,272
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities excluding current portion
of long-term debt ................................. $ 44,973 $ 42,216
Current portion of long-term debt ..................... 19,404 21,026
-------- --------
Total current liabilities ............................. 64,377 63,242
Long-term debt ........................................ 30,314 30,402
Deferred liabilities .................................. 831 835
Other long-term liabilities ........................... 68 124
Shareholders' equity .................................. 177,319 177,669
-------- --------
Shares issued and outstanding at March 30, 2002:
21,940,047; as of December 29, 2001, 21,873,416
$272,909 $272,272
======== ========
2
LITTELFUSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, unaudited)
For the Three Months Ended
MARCH 30, March 31,
2002 2001
-------- --------
Operating activities:
Net income (loss) ........................................ $ (612) $ 3,116
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation ........................................ 4,321 4,800
Amortization ........................................ 192 1,623
Changes in operating assets and liabilities:
Accounts receivable ................................. (4,656) 3,837
Inventories ......................................... 1,197 (1,692)
Current liabilities excluding current portion of
long-term debt ..................................... 2,805 (6,417)
Prepaid expenses and other ............................... (887) (2,234)
-------- --------
Net cash provided by operating activities ................ $ 2,360 $ 3,033
Cash used in investing activities:
Purchases of property, plant, and
equipment, net .................................... (1,805) (5,130)
-------- --------
Net cash used in investing activities ............... (1,805) (5,130)
Cash provided by (used in) financing activities:
Proceeds from long-term debt ........................ -- 11,100
Payments of long-term debt .......................... (1,604) (7,307)
Proceeds from exercise of stock
options and warrants .............................. 687 458
Purchase of common stock and warrants ............... -- (1,256)
-------- --------
Net cash provided by (used in) financing
activities ........................................ (917) 2,995
Effect of exchange rate changes on cash .................. (68) 48
-------- --------
Increase (decrease) in cash and cash
equivalents ......................................... (430) 946
Cash and cash equivalents at beginning
of period ........................................... 34,527 5,491
-------- --------
Cash and cash equivalents at end of
period .............................................. $ 34,097 $ 6,437
======== ========
3
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
MARCH 30, 2002
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated condensed financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information. Accordingly, they do not include all of the information
and notes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments, consisting
of normal recurring accruals, considered necessary for a fair presentation have
been included. Operating results for the period ended March 30, 2002, are not
necessarily indicative of the results that may be expected for the year ending
December 28, 2002. For further information, refer to the Company's consolidated
financial statements and the notes thereto incorporated by reference in the
Company's Annual Report on Form 10-K for the year ended December 29, 2001.
2. INVENTORIES
The components of inventories are as follows (in thousands):
March 30, December 29,
2002 2001
---------- ------------
Raw material $ 9,223 $ 9,244
Work in process 11,734 11,066
Finished goods 23,970 25,898
-------- --------
Total $ 44,927 $ 46,208
======== ========
3. PER SHARE DATA
Net income (loss) per share amounts for the three months ended March 30, 2002
and March 31, 2001 are based on the weighted average number of common and common
equivalent shares outstanding during the periods as follows (in thousands,
except per share data):
4
Three months ended
March 30, March 31,
2002 2001
------- -------
Average shares outstanding 21,877 19,794
Net effect of dilutive stock options,
warrants and restricted shares
- Basic -- --
-------- -------
- Diluted -- 1,895
-------- -------
Average shares outstanding
- Basic 21,877 19,794
======== =======
- Diluted 21,877 21,689
======== =======
Net income (loss) $ (612) $ 3,116
======== =======
Net income per share
- Basic $ (0.03) $ 0.16
======== =======
- Diluted $ (0.03) $ 0.14
======== =======
The quarter ended March 30, 2002 excluded potentially dilutive securities of
197,000 in the computation of diluted earnings per share because the effect
would have been anti-dilutive.
4. COMPREHENSIVE INCOME
In accordance with Statement of Financial Accounting Standards No. 130,
"Reporting Comprehensive Income," total comprehensive income (loss) for the
three months ended March 30, 2002, and March 31, 2001, was approximately $(1.0)
million and $0.3 million, respectively. The adjustment for comprehensive income
is related to the Company's foreign currency translation.
5. RECENTLY ISSUED ACCOUNTING STANDARDS
In August 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets (FAS 144), which addresses financial accounting
and reporting for the impairment or disposal of long-lived assets and supersedes
SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of, and the accounting and reporting provisions
of APB Opinion No. 30, Reporting the Results of Operations for a disposal of a
segment of a business. FAS 144 is effective for fiscal years beginning after
December 15, 2001. Accordingly, the Company adopted FAS 144 as of January 1,
2002, and the adoption of the Statement did not have a significant impact on the
Company's financial position and results of operations.
5
In June 2001, the Financial Accounting Standards Board issued SFAS No. 141,
"Business Combinations" and No. 142, "Goodwill and Other Intangible Assets",
effective for fiscal years beginning after December 15, 2001. Under the new
rules, goodwill and intangible assets deemed to have indefinite lives will no
longer be amortized but will be subject to annual impairment tests in accordance
with the Statement. Other intangible assets will continue to be amortized over
their useful lives.
The Company has applied the new rules on accounting for goodwill and other
intangible assets in the first quarter of 2002. Application of the
non-amortization provisions of the Statement resulted in an increase in net
income of $0.6 million, or $0.03 per share. Pro-forma net income for the three
months ended March 31, 2001, adjusted for the adoption of FAS 142 was $3.7
million or $0.14 per share. The Company performed the first of the required
impairment tests of goodwill and indefinite lived intangible assets as of
January 1, 2002 in the first quarter of 2002. The effect of these tests did not
have a significant impact on the Company's financial position and results of
operations. Additionally and unrelated to adoption of SFAS No. 142, there was a
scheduled decrease in amortization expense of $0.5 million resulting in
increased income of $0.3 million for the period ended March 30, 2002.
6. RESTRUCTURING EXPENSE
The Company has announced a restructuring plan designed to achieve cost
reductions by transferring manufacturing from higher cost locations to lower
cost locations and closing three plants (one each in the US, the UK and Korea).
Included in the Company's operating results for the period ended March 30, 2002,
are restructuring charges of $3.7 million. These charges relate to workforce
reductions in Korea and Ireland and the write-down of manufacturing equipment.
Restructuring of the Korea and Ireland manufacturing operations included $3.0
million of employee termination costs covering 79 technical, production,
administrative and support employees. The remaining $0.7 million of
restructuring expense relates to the non-cash writedown of manufacturing
equipment. As of March 30, 2002, $1.3 million of severance costs have been paid.
The remaining $1.8 million of severance costs, currently shown in accrued
expenses, should be paid by December 31, 2002.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
Sales decreased $10.5 million or 14% to $65.1 million, compared to $75.6 million
in the first quarter of 2001. On a sequential basis, the results reflect an
increase of 7% compared to the fourth quarter of 2001.
Sales in the Americas decreased 15% in the first quarter of 2002, compared to
the first quarter of last year. Europe sales decreased 28% in dollars, and 25%
in constant currency and Asia sales increased 1% in dollars and 4% in constant
currency, compared to the first quarter of 2001.
6
Electronic sales decreased $10.7 million or 24% to $33.2 million in the first
quarter of 2002 compared to $43.9 million in the same quarter of last year.
Electronic sales were down on a worldwide basis, but improved on a sequential
basis from the fourth quarter of 2001. The sequential improvement is driven by
signs of strengthened demand in Asia (other than Japan which remains weak) and
the benefits of lower inventory levels at North American distributors.
Automotive sales increased $0.5 million or 2% to $24.1 million in the first
quarter of 2002 from $23.6 million in the same quarter last year. The increase
in automotive sales was due to continued strength in the North American OEM
business, partially offset by continued weakness in the US aftermarket business
and lower European sales.
Electrical fuse sales decreased $0.3 million or 4% to $7.8 million in the first
quarter of 2001 compared to $8.1 million in the same quarter last year. The
electrical fuse market continues to be weak and has not yet shown signs of
recovery.
Gross margin was $20.0 million or 30.7% of sales for the first quarter of 2002,
compared to $26.9 million or 35.6% in the same quarter last year. On a
sequential basis, gross margin improved 0.7% from the fourth quarter of 2001 as
production increased due to improving demand for electronic and automotive
products.
Operating expenses, excluding amortization and restructuring expense, were $16.9
million or 26.0% of sales for the first quarter of 2002 compared to $19.6
million or 26.0% of sales for the same quarter in the prior year. Total
operating expenses, excluding restructuring expense, were $17.1 million or 26.3%
of sales in the first quarter of 2002 compared to $21.2 million or 28.1% of
sales in the same quarter last year. Contributing to the decrease in total
operating expenses was the reduction in amortization expense resulting from the
combination of the adoption of SFAS No. 142 and a natural drop off of patent
amortization. The adoption of SFAS No. 142 reduced amortization expense by $0.9
million for the quarter, and the natural drop off of patent amortization
provided an additional reduction of $0.5 million for the period.
Operating income (loss) was ($0.8) million for the first quarter 2002 compared
to $5.7 million for the same quarter of last year. The decrease in operating
income was primarily due to lower sales levels and restructuring expenses
related to the manufacturing rationalization program.
Interest expense was $0.7 million in the first quarter of this year compared to
$0.9 million in the first quarter of last year due to lower average debt levels.
Other income was $0.6 million, which included a one-time gain of $0.4 million on
the sale of a product line, for the first quarter of 2002 compared to $0.1
million in the first quarter of the prior year.
Net income (loss) before income taxes was $(1.0) million for the first quarter
2002 compared to $4.9 million for the first quarter of 2001. The income tax
benefit was $0.3 million for the first quarter of 2002 compared to income tax
expense of $1.8 million in the first quarter of last year.
Net income (loss) for the first quarter 2002 was $(0.6) million or $(0.03) per
diluted share compared to $3.1 million or $0.14 per diluted share for the same
quarter of last year.
7
Liquidity and Capital Resources
Assuming no material adverse changes in market conditions or interest rates,
management expects that the Company will have sufficient cash from operations to
support both its operations and its current debt obligations for the foreseeable
future.
Littelfuse started the 2002 year with $34.5 million of cash. Net cash provided
by operations was $2.3 million for the first three months. Net cash used to
invest in property, plant and equipment was $1.8 million. In addition, cash used
to pay long-term debt was $1.6 million and proceeds from warrant and stock
option exercises were $0.7 million, resulting in net cash used in financing
activities of $0.9 million. The net decrease in cash for the three months ended
March 30, 2002 was $0.4 million, leaving the Company with a cash balance of
approximately $34.1 million at March 30, 2002.
The ratio of current assets to current liabilities was 2.2 to 1 at the end of
the first quarter 2002 compared to 2.2 to 1 at year end 2001 and 2.1 to 1 at the
end of the first quarter 2001. The days sales in receivables was 62 days at the
end of the first quarter 2002 compared to 61 days at year-end 2001, and 58 days
at the end of the first quarter 2001. The days inventory outstanding was
approximately 91 days at the end of the first quarter 2002 compared to 108 days
at year-end 2001 and 112 days at end of the first quarter 2001.
The Company's capital expenditures were $1.8 million for the first quarter 2002.
The Company expects that capital expenditures, which are primarily for new
machinery, equipment and information systems, will be approximately $12 - $14
million for the full year 2002.
The long-term debt at the end of the first quarter 2002 consisted of four types
totaling $49.7 million. They are as follows: (1) private placement notes
totaling $40.0 million, (2) foreign revolver borrowings totaling $9.0 million,
(3) notes payable relating to mortgages totaling $0.3 million, (4) other
long-term debt, including capital leases, totaling $0.4 million. These four
items include $19.4 million of senior notes, revolver borrowings and mortgage
notes, which are considered to be current liabilities. This leaves net long-term
debt totaling $30.3 million at March 30, 2002. The private placement notes carry
an interest rate of 6.16%. The Company has a $55.0 million revolver in the U.S.,
all of which was available at March 30, 2002. The bank revolver loan notes carry
an interest rate of prime or LIBOR plus 0.375%. The Company also has an $8.0
million letter of credit facility, of which approximately $2.2 million was being
used at March 30, 2002.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995.
The preceding commentary presents management's discussion and analysis of the
Company's financial condition and results of operations for the periods
presented. Certain of the statements included above, including those regarding
future financial performance or results or those that are not historical facts,
are or contain "forward-looking" information as that term is defined in the
Securities Exchange Act of 1934, as amended. The words "expect," "believe,"
"anticipate," "project," "estimate," and similar expressions are intended to
identify forward-looking statements. The Company cautions readers that any such
statements are not guarantees of future performance or events and such
statements involve risks, uncertainties and assumptions, including, but not
8
limited to, product demand and market acceptance risks, the effect of economic
conditions, the impact of competitive products and pricing, product development
and patent protection, commercialization and technological difficulties,
capacity and supply constraints or difficulties, actual purchases under
agreements, the effect of the Company's accounting policies, currency rate
fluctuations, labor disputes, restructuring costs in excess of expectations and
other risks which may be detailed in the Company's Securities and Exchange
Commission filings. Should one or more of these risks or uncertainties
materialize or should the underlying assumptions prove incorrect, actual results
and outcomes may differ materially from those indicated or implied in the
forward-looking statements. This report should be read in conjunction with
information provided in the financial statements appearing in the Company's
Annual Report on Form 10-K for the year ended December 29, 2001.
Business Segment Information
The Company designs, manufactures and sells circuit protection devices
throughout the world. The Company has three reportable geographic segments: The
Americas, Europe and Asia-Pacific. The circuit protection market in these
geographical segments is categorized into three major product areas: electronic,
automotive and electrical fuses.
The Company evaluates the performance of each geographic segment based on its
net income or loss. The Company also accounts for intersegment sales as if the
sales were to third parties.
The Company's reportable segments are the business units where the revenue is
earned and expenses are incurred. The Company has subsidiaries in The Americas,
Europe and Asia-Pacific where each region is measured based on its sales and
operating income or loss.
Revenues from no single customer amounted to 10% or more of the Company's total
revenues for the quarter ended March 30, 2002.
Information concerning the operations in these geographic segments for the
period ended March 30, 2002 and March 31, 2001, is as follows (in thousands):
- -----------------------------------------------------------
REVENUES 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas 34,334 40,217
- -----------------------------------------------------------
Europe 12,249 17,066
- -----------------------------------------------------------
Asia-Pacific 18,547 18,307
- -----------------------------------------------------------
Combined Total 65,130 75,590
- -----------------------------------------------------------
Corporate -- --
- -----------------------------------------------------------
Reconciliation -- --
- -----------------------------------------------------------
Consolidated Total 65,130 75,590
- -----------------------------------------------------------
9
- -----------------------------------------------------------
INTERSEGMENT REVENUES 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas 14,402 14,792
- -----------------------------------------------------------
Europe 10,213 4,966
- -----------------------------------------------------------
Asia-Pacific 3,061 1,707
- -----------------------------------------------------------
Combined Total 27,676 21,465
- -----------------------------------------------------------
Corporate -- --
- -----------------------------------------------------------
Reconciliation (27,676) (21,465)
- -----------------------------------------------------------
Consolidated Total -- --
- -----------------------------------------------------------
- -----------------------------------------------------------
INTEREST EXPENSE 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas 657 882
- -----------------------------------------------------------
Europe 17 6
- -----------------------------------------------------------
Asia-Pacific 42 43
- -----------------------------------------------------------
Combined Total 716 931
- -----------------------------------------------------------
Corporate 0 0
- -----------------------------------------------------------
Reconciliation 0 0
- -----------------------------------------------------------
Consolidated Total 716 931
- -----------------------------------------------------------
- -----------------------------------------------------------
DEPRECIATION AND AMORTIZATION 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas 3,295 3,100
- -----------------------------------------------------------
Europe 627 886
- -----------------------------------------------------------
Asia-Pacific 399 370
- -----------------------------------------------------------
Combined Total 4,321 4,356
- -----------------------------------------------------------
Corporate 192 2,067
- -----------------------------------------------------------
Reconciliation -- --
- -----------------------------------------------------------
Consolidated Total 4,513 6,423
- -----------------------------------------------------------
- -----------------------------------------------------------
OTHER INCOME (LOSS) 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas (11) (22)
- -----------------------------------------------------------
Europe 644 214
- -----------------------------------------------------------
Asia-Pacific (32) (86)
- -----------------------------------------------------------
Combined Total 601 106
- -----------------------------------------------------------
Corporate -- --
- -----------------------------------------------------------
Reconciliation -- --
- -----------------------------------------------------------
Consolidated Total 601 106
- -----------------------------------------------------------
10
- -----------------------------------------------------------
INCOME TAX EXPENSE(INCOME) 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas (753) (524)
- -----------------------------------------------------------
Europe 614 1,348
- -----------------------------------------------------------
Asia-Pacific (206) 930
- -----------------------------------------------------------
Combined Total (345) 1,754
- -----------------------------------------------------------
Corporate -- --
- -----------------------------------------------------------
Reconciliation -- --
- -----------------------------------------------------------
Consolidated Total (345) 1,754
- -----------------------------------------------------------
- -----------------------------------------------------------
NET INCOME(LOSS) 2002 Q1 2001 Q1
- -----------------------------------------------------------
- -----------------------------------------------------------
The Americas 1,152 (37)
- -----------------------------------------------------------
Europe 1,471 3,354
- -----------------------------------------------------------
Asia-Pacific 701 1,867
- -----------------------------------------------------------
Combined Total 3,324 5,184
- -----------------------------------------------------------
Corporate (3,936) (2,068)
- -----------------------------------------------------------
Reconciliation -- --
- -----------------------------------------------------------
Consolidated Total (612) 3,116
- -----------------------------------------------------------
- ------------------------------------------------------------
2002 Q1 2001 Q1
REVENUES REVENUES
- ------------------------------------------------------------
Electronic 33,216 43,936
- ------------------------------------------------------------
Automotive 24,139 23,574
- ------------------------------------------------------------
Power 7,775 8,080
- ------------------------------------------------------------
Consolidated Total 65,130 75,590
- ------------------------------------------------------------
Item 3. Qualitative and Quantitative Disclosures about Market Risk
The Company is exposed to market risk from changes in foreign exchange rates,
commodities and to a lesser extent, interest rates.
The Company had long-term debt outstanding at March 30, 2002, in the form of
senior notes and foreign lines of credit at variable interest rates. Since a
substantial portion of the debt has fixed interest rates, the Company's interest
expense is not materially sensitive to changes in interest rate levels.
A portion of the Company's operations consists of manufacturing and sales
activities in foreign countries. The Company has manufacturing facilities in
Mexico, Ireland, Switzerland, South Korea, China and the Philippines. During the
first quarter of 2002, sales exported from the United States or manufactured
abroad accounted for approximately 47% of total sales.
11
Substantially all sales in Europe are denominated in British Pounds Sterling
and Euros and substantially all sales in the Asia-Pacific region are denominated
in United States Dollars, Japanese Yen and South Korean Won.
The Company's identifiable foreign exchange exposures result from the purchase
and sale of products from affiliates, repayment of intercompany trade and loan
amounts and translation of local currency amounts in consolidation of financial
results. As international sales accounted for nearly half of the total sales for
the period ended March 30, 2002, a significant portion of the resulting accounts
receivable is denominated in foreign currencies. Changes in foreign currency
exchange rates or weak economic conditions in the foreign countries in which it
manufactures and distributes products could affect the Company's accounts
receivable values and financial results. The Company does not use any material
derivative financial instruments to mitigate its foreign currency risk at the
present time. However, netting and offsetting intercompany account management
techniques are utilized to reduce known foreign currency expenses.
The Company uses various metals in the production of its products, including
zinc, copper and silver. The Company's earnings are exposed to fluctuations in
the prices of these commodities. The Company does not currently use derivative
financial instruments to mitigate this commodity price risk.
PART II - OTHER INFORMATION
Item 6: Exhibits and Reports on Form 8-K
(a) Exhibit Description
------- -----------
4.3 Stock Plan for Employees and Directors of Littelfuse,
Inc., as amended
(b) There were no reports on Form 8-K filed during the quarter ended
March 30, 2002.
12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Quarterly Report on Form 10-Q for the quarter
ended March 30, 2002, to be signed on its behalf by the undersigned thereunto
duly authorized.
LITTELFUSE, INC.
Date: May 16, 2002 By /s/ Philip G. Franklin
-------------------------------------
Philip G. Franklin
Vice President, Treasurer,
and Chief Financial Officer
(As duly authorized officer and
as the principal financial and
accounting officer)
13