Littelfuse, Inc. 10-K Summary (Fiscal Year Ended Dec 28, 2002)
Business Context and Reporting Period
This Form 10-K covers the fiscal year ended December 28, 2002. Littelfuse, Inc. is the world's leading supplier of circuit protection products for the electronics, automotive, and electrical industries. The company operates globally with facilities in the Americas, Europe, and Asia-Pacific. Approximately 54% of net sales in 2002 were generated from customers outside the United States.
Key Financial Metrics
Revenue: Total net sales for fiscal 2002 were $283.27 million.
- Electronic Products: $150.84 million (53% of total sales).
- Automotive Products: $98.24 million (35% of total sales).
- Electrical Products: $34.19 million (12% of total sales).
Profitability and Cash Flow: The filing text incorporates the Consolidated Statements of Income and Cash Flows by reference to the Annual Report to Stockholders; therefore, specific values for net income, operating margins, and cash flow are not provided in the source text.
Debt and Liquidity: Specific debt balances and liquidity ratios are not provided in the source text. The company maintains credit agreements that restrict dividend payments based on minimum net worth and financial ratios.
Backlog: Unfilled orders totaled approximately $29.2 million as of December 28, 2002.
Intellectual Property Income: License royalties amounted to $369,000 for fiscal 2002.
Material Changes vs. Prior Period
- Total Revenue: Increased 4.1% from $272.15 million in 2001 to $283.27 million in 2002.
- Electronic Segment: Sales increased 3.1% to $150.84 million, recovering from a significant decline in 2000 ($232.68 million).
- Automotive Segment: Sales increased 7.9% to $98.24 million.
- Electrical Segment: Sales decreased 1.6% to $34.19 million.
- Backlog: Increased significantly from $21.9 million in 2001 to $29.2 million in 2002.
- R&D Spend: Product design and development expenses decreased to $8.3 million in 2002, down from $8.9 million in 2001 and $11.2 million in 2000.
Outlook, Risks, and Contingencies
Management Commentary: The backlog is considered firm, with substantially all orders scheduled for delivery in 2003. The company continues to invest in product development, with cycles ranging from 6 to 18 months.
Risks:
- Competition: The industry is highly competitive with rivals possessing greater financial resources (e.g., Cooper Industries, AVX, Bourns).
- Supply Chain: Dependence on single sources for stamped metal end caps, heat-resistant plastics, and zinc. Management believes alternatives exist without material adverse effect.
- Market Volatility: Revenues may vary significantly due to customer buying decisions and general economic conditions.
- Environmental: The facility in Dundalk, Ireland, is not currently in full compliance with local environmental laws; corrective steps are underway, and the company holds an indemnity from Harris Corporation.
Legal Proceedings: No material legal proceedings are pending.
Investor Verification Checklist
- Verify the specific Net Income and Operating Margin figures in the "Consolidated Statements of Income" (incorporated by reference from the Annual Report to Stockholders).
- Review the "Consolidated Statements of Cash Flows" to assess liquidity and free cash flow generation.
- Confirm the status of the Ireland facility environmental compliance and the enforceability of the Harris Corporation indemnity.
- Monitor the execution of the $29.2 million backlog to ensure it converts to revenue in 2003 as projected.
- Assess the impact of single-source suppliers for critical raw materials (plastics, zinc, metal end caps) on future cost structures.