Revenue Performance - The company's revenues decreased by 105.0million,or16.4534.792 million, down 16.4% from 639.813millionin2023[257].−RevenuefromNorthAmericafor2024was362.2 million, down from 447.8millionin2023,indicatingadecreaseofabout19.2357.8 million in 2024, down from 439.3millionin2023,adecreaseofapproximately18.5534.8 million, a decrease from 639.8millionin2023,representingadeclineofapproximately16.5245.6 million in 2024, down from 314.1millionin2023,whilegrossmarginimprovedto42.49.8 million, or 4.7%, in 2024, driven by a 3.6millionincreaseincommercialaerospacesales[165].−MagneticSolutionssalesdeclinedby46.3 million in 2024, primarily due to reduced demand from networking customers[166]. - Power Solutions and Protection product sales increased by 25.7millionin2023comparedto2022,drivenbya42.7 million increase in front-end power products and a 6.9millionincreaseinboardmountpowerproducts[167].−eMobilityendmarketsalesrosebyover7.5 million (40%) and rail end market sales increased by 7.5million(33949.789 million in 2024, up 66.1% from 571.631millionin2023[255].−Long−termdebtrosesharplyto287.500 million in 2024, compared to 60.000millionin2023,indicatingasubstantialincreaseinleverage[255].−Thecompanyhad68.3 million in cash and cash equivalents and 1.0millioninheldtomaturityinvestmentsasofDecember31,2024[191].−Thecompanyhad287.5 million outstanding under its revolving credit facility as of December 31, 2024, with no mandatory principal payments due in 2025[197]. - The company expects to meet future liquidity needs through existing cash, cash equivalents, and anticipated cash flows from operations[197]. Expenses and Costs - SG&A expenses increased to 110.6millionin2024from99.1 million in 2023, driven by acquisition-related costs of 10.9 million[176]. - R&D expenses were 23.6 million in 2024, up from 22.5millionin2023,primarilyduetohighersalariesandcostsrelatedtotheEnerconacquisition[175].−Interestexpenseroseto4.1 million in 2024 from 2.9millionin2023,mainlyduetoincreaseddebtfromtheEnerconacquisition[180].−Theprovisionforincometaxeswas12.6 million in 2024, up from 9.5millionin2023,withaneffectivetaxrateof20.53.5 million in restructuring costs in 2024, with annual cost savings from the Glen Rock initiative estimated at 3.1million[162].AcquisitionsandInvestments−OnNovember14,2024,theCompanyacquiredan80324 million, with recorded assets including noncontrolling interest, trade names, and customer relationships valued at 72.3million,21.9 million, and 130.3millionrespectively[242].−EnerconTechnologies,Ltd.accountedfor15.912.9 million in acquisition-related costs associated with the Enercon transaction, primarily for investment banker fees and legal expenses[311]. - The total cash paid at closing for the Enercon acquisition was approximately 325.6million,fundedby85.6 million in cash on hand and 240millionfromincrementalborrowings[309].−Enerconcontributed20.8 million in revenue and approximately 1.0millioninnetearningstothecompany′sconsolidatedfinancialresultsfortheperiodfromNovember1,2024,toDecember31,2024[318].ShareholderReturns−Thecompanydeclareddividendsof3.5 million in 2024, consistent with previous years[201]. - The company repurchased treasury stock amounting to 16,053millionin2024,asignificantincreasecomparedto105 million in 2023[267]. - Dividends paid to common shareholders decreased to 3,453millionin2024from3,492 million in 2023, reflecting a reduction of approximately 1.1%[267]. - The company authorized a share repurchase program of up to 25million,with9.0 million of authorized repurchases not yet executed as of December 31, 2024[202]. Impairments and Valuations - The Company conducted its annual goodwill impairment test as of October 1, 2024, and no impairment was identified[222]. - The Company recorded reserves for excess or obsolete inventory of 14.5millionasofDecember31,2024,anincreasefrom13.7 million in 2023[213]. - The Company identified and recorded a $0.4 million impairment charge related to its CUI tradename during its annual impairment tests[223]. - The fair value of the Company's four reporting units exceeded their respective carrying values by a margin ranging from 44% to 500%[221]. - The estimated fair values exceed the carrying values for the reporting units as follows: Power Solutions and Protection (excluding CUI) at 500.5%, Connectivity Solutions at 156.0%, and CUI at 43.6%[339]. Tax and Regulatory Matters - The effective tax rate will fluctuate based on the geographic region of pretax profits, with Asia having the lowest tax rates among the company's operational regions[162]. - The effective tax rate includes the effect of tax contingency liabilities, which are analyzed quarterly and adjusted based on changes in facts and circumstances[294]. - The Company has established valuation allowances for deferred tax assets that are not likely to be realized, impacting the provision for income taxes[294]. Risk Management - The Company actively monitors commodity price risks, particularly for metals such as copper, zinc, tin, gold, and silver, and anticipates increased material costs while implementing strategies like price adjustments and productivity improvements[230]. - The Company employs various strategies to manage foreign exchange risks, including strategic factory locations and hedging contracts[229]. - The Company does not engage in speculative trading and maintains strong relationships with financial institutions to minimize exposure risks[229]. - The Company has adequate primary and secondary sources for each of its key materials to mitigate potential volatility in metal prices[230].
