What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-05-01 compared with 2023-11-01 · 269 added, 329 removed, 534 unchanged (53% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands) September 30,

(in thousands) March 30,

2024 December 30,

Current assets:

Cash and cash equivalents $ 560,056 $ 562,588

Cash and cash equivalents (Note 1) $ 562,153 $ 555,513

Short-term investments 231 235

Trade receivables, less allowanc es o f $ 88,440 and $ 83,562 at September 30, 2023 and December 31, 2022, respectively

Trade receivables, less allowanc es o f $ 76,496 and $ 84,696 at March 30, 2024 and December 30, 2023, respectively

295,876 287,018

Inventories 483,075 547,690

Inventories (Note 3) 456,135 474,607

Prepaid income taxes and income taxes receivable 8,574 8,701

1 unchanged sentence

Total current assets 1,444,111 1,408,600

Net property, plant, and equipment 478,906 481,110

Intangible assets, net of amortization 612,366 593,970

Goodwill 1,284,343 1,186,922

Net property, plant, and equipment (Note 4) 479,435 493,153

Intangible assets, net of amortization (Note 5) 584,631 606,136

Goodwill (Note 5) 1,294,737 1,309,998

Investments 24,204 24,821

Deferred income taxes 10,798 10,486

Right of use lease assets, net 51,755 57,382

Right of use lease assets 63,718 62,370

Other long-term assets 41,827 79,711

3 unchanged sentences

Accounts payable $ 172,809 $ 173,535

Accrued liabilities 143,540 187,057

Accrued liabilities (Note 6) 124,288 149,214

Accrued income taxes 42,051 38,725

Current portion of long-term debt 135,619 134,874

Current portion of long-term debt (Note 8) 65,824 14,020

Total current liabilities 404,972 375,494

Long-term debt, less current portion 857,006 866,623

Long-term debt, less current portion (Note 8) 800,849 857,915

Deferred income taxes 100,755 110,820

Accrued post-retirement benefits 34,049 34,422

Non-current operating lease liabilities 39,818 45,661

Non-current lease liabilities 50,791 49,472

Other long-term liabilities 80,752 86,671

Total liabilities $ 1,472,168 $ 1,514,794

Commitments and contingencies (Note 15)

Shareholders’ equity:

1 unchanged sentence

34,000,000 shares authorized;

shares issued, September 30, 2023– 26,613,883 ;

shares issued, March 30, 2024– 26,634,597 ;

December 30, 2023– 26,624,071

13 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME

Three Months Ended Nine Months Ended

(in thousands, except per share data) September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three Months Ended

(in thousands, except per share data) March 30,

2024 April 1,

Net sales $ 535,385 $ 609,782

8 unchanged sentences

Interest expense 9,611 9,646

Foreign exchange loss 11,776 18,191 8,697 40,051

Other (income) expense, net ( 3,527 ) ( 698 ) ( 11,810 ) 9,789

Foreign exchange gain ( 5,042 ) ( 1,675 )

Other income, net ( 5,321 ) ( 6,233 )

Income before income taxes 55,704 108,903

10 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended Nine Months Ended

(in thousands) September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three Months Ended

(in thousands) March 30,

2024 April 1,

Net income $ 48,452 $ 88,745

Other comprehensive (loss) income:

Pension and postemployment adjustment, net of tax ( 3 ) 599 ( 156 ) 1,548

Other comprehensive income (loss):

Defined benefit pension plan and other adjustments, net of tax 344 6

Cash flow hedge, net of tax 1,926 ( 2,518 )

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022

Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

OPERATING ACTIVITIES

4 unchanged sentences

Deferred revenue ( 918 ) 639

Non-cash inventory charges — 11,534

Impairment charges 933 —

Stock-based compensation 3,617 3,730

Loss on investments and other assets 922 13,740

Loss (gain) on investments and other assets 379 ( 1,779 )

Deferred income taxes ( 8,811 ) 1,624

13 unchanged sentences

FINANCING ACTIVITIES

Proceeds of term loan — 300,000

Proceeds of senior notes — 100,000

Payments of senior notes payable — ( 25,000 )

Repayments of other debts ( 678 ) ( 668 )

1 unchanged sentence

Net proceeds related to stock-based award activities 1,364 5,219

Debt issuance costs — ( 2,600 )

Repurchases of common stock ( 16,131 ) —

Cash dividends paid ( 16,200 ) ( 14,880 )

Net cash (used in) provided by financing activities ( 47,144 ) 321,923

Net cash used in financing activities ( 33,520 ) ( 12,204 )

Effect of exchange rate changes on cash, cash equivalents, and restricted cash ( 8,550 ) 4,571

Decrease in cash, cash equivalents, and restricted cash ( 3,348 ) ( 6,581 )

Increase (decrease) in cash, cash equivalents, and restricted cash 6,597 ( 137,414 )

Cash, cash equivalents, and restricted cash at beginning of period 557,123 564,939

17 unchanged sentences

Net income — — — — 48,452 — 48,452

Other comprehensive income, net of tax — — — 13,283 — — 13,283

Stock-based compensation — 3,730 — — — — 3,730

Non-controlling interest — — — — ( 66 ) 66 —

Withheld shares on restricted share units for withholding taxes — — ( 18 ) — — — ( 18 )

Stock options exercised — 5,238 — — — — 5,238

Cash dividends paid ($ 0.60 per share)

— — — — ( 14,880 ) — ( 14,880 )

Balance at April 1, 2023 $ 261 $ 983,065 $ ( 252,884 ) $ ( 82,481 ) $ 1,659,265 $ 250 $ 2,307,476

Net income — — — — 70,071 — 70,071

Other comprehensive loss, net of tax — — — ( 30,291 ) — — ( 30,291 )

3 unchanged sentences

Stock options exercised — 1,369 — — — — 1,369

Cash dividends paid ($ 0.60 per share)

— — — — ( 14,910 ) — ( 14,910 )

Balance at July 1, 2023 $ 261 $ 998,589 $ ( 258,883 ) $ ( 97,392 ) $ 1,714,381 $ 295 $ 2,357,251

Net income — — — — 57,788 — 57,788

Other comprehensive loss, net of tax — — — ( 2,134 ) — — ( 2,134 )

Stock-based compensation — 3,857 — — — — 3,857

Non-controlling interest ( 50 ) 50 —

Withheld shares on restricted share units for withholding taxes — — ( 308 ) — — — ( 308 )

Stock options exercised 1 4,587 — — — — 4,588

Repurchases of common stock — — ( 16,131 ) — — — ( 16,131 )

Cash dividends paid ($ 0.65 per share)

— — — — ( 16,200 ) — ( 16,200 )

Balance at September 30, 2023 $ 262 $ 1,007,033 $ ( 259,191 ) $ ( 99,526 ) $ 1,755,936 $ 345 $ 2,404,859

Balance at March 30, 2024 $ 262 $ 1,017,311 $ ( 275,398 ) $ ( 86,108 ) $ 1,814,916 $ 310 $ 2,471,293

Littelfuse, Inc.

2 unchanged sentences

Paid in Capital Treasury Stock Accum.

(Loss) Retained Earnings Non-controlling Interest Total

Balance at January 1, 2022 $ 260 $ 946,588 $ ( 248,120 ) $ ( 73,463 ) $ 1,268,124 $ 131 $ 1,893,520

(Loss) Income Retained Earnings Non-controlling Interest Total

Balance at December 31, 2022 $ 261 $ 974,097 $ ( 252,866 ) $ ( 95,764 ) $ 1,585,466 $ 184 $ 2,211,378

Net income — — — — 88,745 — 88,745

Other comprehensive loss, net of tax — — — ( 2,203 ) — — ( 2,203 )

Other comprehensive income, net of tax — — — 13,283 — — 13,283

Stock-based compensation — 3,730 — — — — 3,730

Non-controlling interest — — — — ( 66 ) 66 —

Withheld shares on restricted share units for withholding taxes — — ( 18 ) — — — ( 18 )

3 unchanged sentences

Balance at April 1, 2023 $ 261 $ 983,065 $ ( 252,884 ) $ ( 82,481 ) $ 1,659,265 $ 250 $ 2,307,476

Net income — — — — 87,016 — 87,016

Other comprehensive loss, net of tax — — — ( 31,349 ) — — ( 31,349 )

Stock-based compensation — 11,382 — — — — 11,382

Withheld shares on restricted share units for withholding taxes — — ( 4,704 ) — — — ( 4,704 )

Stock options exercised 1 2,060 — — — — 2,061

Cash dividends paid ($ 0.53 per share)

— — — — ( 13,115 ) — ( 13,115 )

Balance at July 2, 2022 $ 261 $ 964,937 $ ( 252,828 ) $ ( 107,015 ) $ 1,446,457 $ 131 $ 2,051,943

Net income — — — — 75,468 — 75,468

Other comprehensive loss, net of tax — — — ( 28,188 ) — — ( 28,188 )

Stock-based compensation — 4,464 — — — — 4,464

Non-controlling interest — — — — ( 36 ) 36 —

Stock options exercised — 58 — — — — 58

Cash dividends paid ($ 0.60 per share)

— — — — ( 14,854 ) — ( 14,854 )

Balance at October 1, 2022 $ 261 $ 969,459 $ ( 252,828 ) $ ( 135,203 ) $ 1,507,035 $ 167 $ 2,088,891

See accompanying Notes to Condensed Consolidated Financial Statements.

15 unchanged sentences

Revenue Disaggregation

The following tables disaggregate the Company’s revenue by primary business units for the three and nine months ended September 30, 2023 and October 1, 2022:

Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023

The following tables disaggregate the Company’s revenue by primary business units for the three months ended March 30, 2024 and April 1, 2023:

Three Months Ended March 30, 2024

(in thousands) Electronics

1 unchanged sentence

Segment Industrial

Total Electronics

Segment Transportation

Segment Industrial

Electronics – Passive Products and Sensors $ 152,410 $ — $ — $ 152,410 $ 453,860 $ — $ — $ 453,860

Electronics – Semiconductor $ 157,871 $ — $ — $ 157,871

Electronics – Passive Products and Sensors 133,234 — — 133,234

Commercial Vehicle Products — 79,514 — 79,514

Passenger Car Products — 70,262 — 70,262

Automotive Sensors — 20,591 — 20,591

Commercial Vehicle Products — 81,290 — 81,290 — 248,765 — 248,765

Industrial Products — — 73,913 73,913

Total $ 291,105 $ 170,367 $ 73,913 $ 535,385

Three Months Ended October 1, 2022 Nine Months Ended October 1, 2022

Three Months Ended April 1, 2023

(in thousands) Electronics

1 unchanged sentence

Segment Industrial

Segment Transportation

Segment Industrial

Electronics – Passive Products and Sensors $ 188,916 $ — $ — $ 188,916 $ 521,172 $ — $ — $ 521,172

Electronics – Semiconductor $ 209,995 $ — $ — $ 209,995

Electronics – Passive Products and Sensors 148,598 — — 148,598

Commercial Vehicle Products — 84,146 — 84,146

Passenger Car Products — 61,697 — 61,697

Automotive Sensors — 20,798 — 20,798

Commercial Vehicle Products — 96,457 — 96,457 — 289,378 — 289,378

Industrial Products — — 84,548 84,548

5 unchanged sentences

At the end of each period, for those shipments where title to the products and the risk of loss and rewards of ownership do not transfer until the product has been received by the customer, the Company adjusts revenues and cost of sales for the delay between the time that the products are shipped and when they are received by the customer.

The amount of revenue recorded reflects the consideration to which the Company expects to be entitled in exchange for goods and may include adjustments for customer allowance, rebates and price adjustments.

The amount of revenue recorded reflects the consideration to which the Company expects to be entitled in exchange for goods and may include adjustments for customer allowances, rebates and price adjustments.

The Company’s distribution channels are primarily through direct sales and independent third-party distributors.

The Company elected the practical expedient under Accounting Standards Codification ("ASC") 340-40-25-4 to expense commissions when incurred as the amortization period of the commission asset the Company would have otherwise recognized is less than one year.

The Company has elected the practical expedient under Accounting Standards Codification ("ASC") 340-40-25-4 to expense commissions when incurred as the amortization period of the commission asset the Company would have otherwise recognized is less than one year.

Revenue and Billing

9 unchanged sentences

This program allows the distributor to debit the Company for the difference between the distributors’ contracted price and a lower price for specific transactions.

Under certain circumstances (usually in a competitive situation or large volume opportunity), a distributor will request authorization for pricing allowances to reduce its

Under certain circumstances (usually in a competitive situation or large volume opportunity), a distributor will request authorization for pricing allowances to reduce its price.

When the Company approves such a reduction, the distributor is authorized to “debit” its account for the difference between the contracted price and the lower approved price.

1 unchanged sentence

Return to Stock

The Company has a return to stock policy whereby certain customers, with prior authorization from Littelfuse management, can return previously purchased goods for full or partial credit.

The Company has a return to stock policy whereby certain customers, with prior authorization from the Company's management, can return previously purchased goods for full or partial credit.

The Company establishes an estimated allowance for these returns based on historical activity.

5 unchanged sentences

Cash, Cash Equivalents, and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash at September 30, 2023 and December 31, 2022 reported within the Condensed Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Condensed Consolidated Statement of Cash Flows.

(in thousands) September 30, 2023 December 31, 2022

The following table provides a reconciliation of cash, cash equivalents, and restricted cash at March 30, 2024 and December 30, 2023 reported within the Condensed Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Condensed Consolidated Statement of Cash Flows.

(in thousands) March 30, 2024 December 30, 2023

Cash and cash equivalents $ 562,153 $ 555,513

Restricted cash included in prepaid expenses and other current assets — 802

Restricted cash included in other long-term assets 1,567 1,610

Total cash, cash equivalents, and restricted cash $ 563,720 $ 557,123

Recently Issued Accounting Standards

In October 2023, the Financial Accounting Standards Board ("FASB") issued ASU No.

2023-06, "Disclosure Improvements".

The amendments in this update represent changes to clarify or improve the disclosure or presentation requirements of a variety of Topics in the ASC.

The Company may be affected by one or more of those amendments.

The amendments in this ASU should be applied prospectively and will not be effective until June 30, 2027.

The company is currently evaluating the potential effects of these amendments on its Condensed Consolidated Financial Statements.

In March 2023, the FASB issued ASU No.

Recently Adopted Accounting Standards

In March 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Updates ("ASU")ASU No.

2023-01, "Leases (Topic 842):

5 unchanged sentences

Additionally, those leasehold improvements are subject to the impairment guidance in Topic 360, Property, Plant, and Equipment.

This standard is effective on January 1, 2024.

The Company does not expect any material effect on the Company's Condensed Consolidated Financial Statements.

This standard is effective for fiscal years beginning after December 15, 2023 including interim periods within those fiscal years.

The adoption of ASU 2023-01 did not have a material impact on the Company's Condensed Consolidated Financial Statements.

Recently Issued Accounting Standards

In March 2024, the Securities and Exchange Commission (SEC) issued a final rule that requires registrants to provide climate disclosures in annual reports and registration statements.

The climate-related final rule requires disclosures in the footnotes to the financial statements, including:

1) specified financial statement effects of severe weather events and other natural conditions, 2) certain carbon offsets and renewable energy credits or certificates if used as a material component of a registrant's plans to achieve its disclosed climate-related targets or goals, 3) material impacts on financial estimates and assumptions in the financial statements if they would materially impacted by risks and uncertainties associated with severe weather events and other natural conditions, previously disclosed climate-related targets, and transition plans.

The financial statement disclosure requirements are effective beginning with annual reports for the fiscal year beginning in calendar year 2025, for the Company as a large accelerated filer.

These disclosures will be subject to existing audit requirement for financial statements.

On April 4, 2024, the SEC chose to stay its climate disclosure rules pending judicial review.

The adoption of this rule will increase the Company's disclosures in its Consolidated Financial Statements.

The Company is currently evaluating and is in the process of performing its initial assessment of the potential impact on its Condensed Consolidated Financial Statements.

In December 2023, the FASB issued ASU No.

2023-09, "Income Taxes (Topic 740):

Improvements to Income Tax Disclosures".

The amendments in this update provide more transparency about income tax information through improvements to the income tax disclosure primarily related to the income tax rate reconciliation and income taxes paid information.

These requirements include:

(1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction.

The other amendments in this update improve the effectiveness and comparability of disclosures by (3) adding disclosures of pretax income (or loss) and income tax expense (or benefit), and (4) removing disclosures that are no longer considered cost beneficial or relevant.

The guidance is effective for fiscal years beginning after December 15, 2024 with early adoption permitted.

The adoption of this guidance will modify the Company's disclosures in its Condensed Consolidated Financial Statements.

In November 2023, the FASB issued ASU No.

2023-07, "Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures".

The amendments in this update require additional detailed and enhanced information about reportable segments' expense, including significant segment expenses and other segment items that bridge segment revenue, significant expenses to segment profit or loss.

The ASU also requires disclosure of the title and position of the Chief Operating Decision Maker (“CODM”) on annual basis as well as an explanation of how CODM uses the reported measures and other disclosures.

The amendments in this update do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments.

The guidance is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The adoption of this guidance will modify the Company's disclosures in its Condensed Consolidated Financial Statements.

In October 2023, the FASB issued ASU No.

2023-06, "Disclosure Improvements".

The amendments in this update represent changes to clarify or improve the disclosure or presentation requirements of a variety of Topics in the ASC.

The Company may be affected by one or more of those amendments.

The amendments in this ASU should be applied prospectively and will not be

effective until June 30, 2027.

The company is currently evaluating the potential effects of these amendments on its Condensed Consolidated Financial Statements.

The Company accounts for acquisitions using the acquisition method in accordance with ASC 805, “Business Combinations,” in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition.

The operating results of

the acquired business are included in the Company’s Condensed Consolidated Financial Statements from the date of the acquisition.

The operating results of the acquired business are included in the Company’s Condensed Consolidated Financial Statements from the date of the acquisition.

On June 28, 2023, the Company entered into a definitive purchase agreement to acquire a 200mm wafer fab located in Dortmund, Germany (“Dortmund Fab”) from Elmos Semiconductor SE.

The acquisition of the Dortmund Fab is expected to close in early fiscal year 2025.

The total purchase price for the fab is approximately 93 million Euro, of which 37.2 million Euro down payment (approximately $ 40.5 million) recorded in Other long-term assets in the Condensed Consolidated Balance Sheets was paid in the third quarter after regulatory approvals and approximately 56 million Euro will be paid at closing.

The transaction is not expected to have a material impact on the Company’s fiscal year 2023 or 2024 financial results and will be reported in the Electronics-Semiconductor business within the Company’s Electronics segment.

The total purchase price for the Dortmund Fab is approximately 93 million Euro, of which 37.2 million Euro down payment (approximately $ 40.5 million) recorded in Prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets was paid in the third quarter of 2023 after regulatory approvals and approximately 56 million Euro will be paid at closing.

The transaction is not expected to have a material impact on the Company’s fiscal year 2024 financial results and will be reported in the Electronics-Semiconductor business within the Company’s Electronics segment.

Western Automation

4 unchanged sentences

The acquisition was funded with cash on hand.

The total purchase consideration of $ 158.3 million, net of cash, has been allocated, on a preliminary basis, to assets acquired and liabilities assumed, as of the completion of the acquisition, based on preliminary estimated fair values.

The purchase price allocation is preliminary because the evaluations necessary to assess the fair values of the net assets acquired are still in process.

The primary area not yet finalized relates to the completion of the valuation of certain acquired income tax assets and liabilities.

As a result, these allocations are subject to change during the purchase price allocation period as the valuations are finalized.

The following table summarizes the preliminary purchase price allocation of the fair value of assets acquired and liabilities assumed in the Western Automation acquisition:

The total purchase consideration of $ 158.3 million, net of cash acquired, has been allocated to assets acquired and liabilities assumed, as of the completion of the acquisition, based on estimated fair values.

The following table summarizes the final purchase price allocation of the fair value of assets acquired and liabilities assumed in the Western Automation acquisition:

(in thousands) Purchase Price

2 unchanged sentences

Allocation of consideration to assets acquired and liabilities assumed:

Trade receivables, net 3,389

Trade receivables 3,359

Inventories 3,678

3 unchanged sentences

Goodwill 93,937

Other non-current assets 573

Other long-term assets 573

Current liabilities ( 4,335 )

Other non-current liabilities ( 8,998 )

Other long-term liabilities ( 8,998 )

All Western Automation assets and liabilities were recorded in the Industrial segment and are primarily reflected in the Europe geographic area.

1 unchanged sentence

Goodwill resulting from the Western Automation acquisition is not expected to be deductible for tax purposes.

Included in the Company’s Condensed Consolidated Statements of Net Income for the three and nine months ended September 30, 2023 are net sales of $ 2.7 million and $ 10.2 million respectively, and a loss before income taxes of $ 1.0 million and $ 0.8 million, respectively, since the February 3, 2023 acquisition of Western Automation.

During the nine months ended September 30, 2023, the Company incurred approximately $ 1.2 million of legal and professional fees related to the Western Automation acquisition recognized as Selling, general, and administrative expenses .

During the three months ended April 1, 2023, the Company incurred approximately $ 1.4 million of legal and professional fees related to the Western Automation acquisition recognized as Selling, general, and administrative expenses .

These costs were reflected as other non-segment costs.

On July 19, 2022, the Company completed the previously announced acquisition of C&K Switches (“C&K”) for $ 540 million in cash.

Founded in 1928, C&K is a leading designer and manufacturer of high-performance electromechanical switches and interconnect solutions with a strong global presence across a broad range of end markets, including industrial, transportation, datacom, and aerospace.

At the time the Company and C&K entered into the definitive agreement, C&K had annualized sales of over $ 200 million.

The business is reported as part of the electronics-passive products and sensors business within the Company's Electronics segment.

The acquisition was funded through a combination of cash on hand and debt.

The total purchase consideration of $ 523.0 million, net of cash acquired, has been allocated to assets acquired and liabilities assumed, as of the completion of the acquisition, based on estimated fair values.

The following table summarizes the final purchase price allocation of the fair value of assets acquired and liabilities assumed in the C&K acquisition:

(in thousands) Purchase Price

Total purchase consideration:

Cash, net of cash acquired $ 523,014

Allocation of consideration to assets acquired and liabilities assumed:

Trade receivables, net 20,967

Inventories 42,968

Other current assets 2,932

Property, plant, and equipment 32,791

Intangible assets 254,700

Goodwill 274,124

Other non-current assets 14,797

Current liabilities ( 47,687 )

Long-term debt ( 9,626 )

Other non-current liabilities ( 62,952 )

All C&K goodwill, other assets and liabilities were recorded in the Electronics segment and are reflected in the Americas, Europe and Asia-Pacific geographic areas.

The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining C&K’s products and technology with the Company’s existing Electronics products portfolio.

Goodwill resulting from the C&K acquisition is not expected to be deductible for tax purposes.

During the nine months ended September 30, 2023, the Company recorded measurement period adjustments to increase other non-current liabilities of $ 4.2 million associated with uncertain tax positions, income taxes payable of $ 0.2 million, and reduce accrued liabilities of $ 0.3 million and deferred tax liabilities of $ 0.2 million.

As a result of these adjustments, goodwill was increased by $ 3.9 million.

As required by purchase accounting rules, the Company recorded a $ 10.8 million step-up of inventory to its fair value as of the acquisition date based on the preliminary valuation.

The step-up was amortized as a non-cash charge to cost of sales during the third and fourth quarter of 2022 as the acquired inventory was sold and reflected as other non-segment costs.

On April 12, 2022, the Company acquired Embed Ltd.

Founded in 2005, Embed is a proven provider of embedded software and firmware developed for a broad range of applications serving transportation end markets, primarily including commercial vehicle electrification and eMobility.

The business is included in the commercial vehicle business within the Company's Transportation segment.

The acquisition was funded with the Company’s cash on hand.

The total purchase consideration was $ 9.2 million, net of cash.

Pro Forma Results

The following table summarizes, on an unaudited pro forma basis, the combined results of operations of the Company and Western Automation as though the acquisition had occurred as of January 2, 2022, and C&K as though the acquisition had occurred as of December 27, 2020, and Carling business acquired on November 30, 2021 as though the acquisition had occurred as of December 29, 2019.

The Company has not included pro forma results of operations for Embed as its operations were not material to the Company.

The pro forma amounts presented are not necessarily indicative of either the actual consolidated results had the Western Automation acquisition occurred as of January 2, 2022, and had the C&K acquisition occurred as of December 27, 2020 and had Carling acquisition occurred as of December 29, 2019 or of future consolidated operating results.

For the Three Months Ended For the Nine Months Ended

(in thousands, except per share amounts) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

The following table summarizes, on an unaudited pro forma basis, the combined results of operations of the Company and Western Automation as though the acquisition had occurred as of January 2, 2022.

For the Three Months Ended

(in thousands, except per share amounts) April 1, 2023

Net sales $ 611,668

4 unchanged sentences

Pro forma results presented above primarily reflect the following adjustments:

For the Three Months Ended For the Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

For the Three Months Ended

(in thousands) April 1, 2023

Amortization (a) $ ( 479 )

Depreciation — 451 — 1,979

Transaction costs (b) 1,397

Amortization of inventory step-up (c) — 6,765 — 11,534

Interest expense (d) — 497 — 815

Income tax benefit (expense) of above items 28 ( 2,644 ) ( 91 ) ( 3,893 )

(a) The amortization adjustment for the nine months ended September 30, 2023 and three and nine months ended October 1, 2022 primarily reflects incremental amortization resulting from the measurement of intangibles at their fair values.

(b) The transaction cost adjustments reflect the reversal of certain legal and professional fees from the three and nine months ended September 30, 2023 and three and nine months ended October 1, 2022, and recognition of those fees during the three and nine months ended September 30, 2023.

(c) The amortization of inventory step-up adjustment reflects the reversal of the amount recognized related to the Carling acquisition during the three months ended April 2, 2022.

The inventory step-up was amortized over four months as the inventory was sold.

(d) The interest expense adjustment reflects incremental interest expense related to the financing of the C&K acquisition.

The components of inventories at September 30, 2023 and December 31, 2022 are as follows:

(in thousands) September 30, 2023 December 31, 2022

Income tax expense of above items ( 115 )

(a) The amortization adjustment for the three months ended April 1, 2023 primarily reflects incremental amortization resulting from the measurement of intangibles at their fair values.

(b) The transaction cost adjustments reflect the reversal of certain legal and professional fees from the three months ended April 1, 2023, and recognition of those fees during the three months ended April 2, 2022.

The components of inventories at March 30, 2024 and December 30, 2023 are as follows:

(in thousands) March 30, 2024 December 30, 2023

Raw materials $ 201,625 $ 201,984

4 unchanged sentences

Property, Plant, and Equipment

The components of net property, plant, and equipment at September 30, 2023 and December 31, 2022 are as follows:

(in thousands) September 30, 2023 December 31, 2022

The components of net property, plant, and equipment at March 30, 2024 and December 30, 2023 are as follows:

(in thousands) March 30, 2024 December 30, 2023

Land and land improvements $ 18,529 $ 22,212

3 unchanged sentences

Total $ 479,435 $ 493,153

The Company recorded depreciation expense of $ 17.9 million and $ 17.0 million for the three months ended September 30, 2023 and October 1, 2022, respectively, and $ 53.5 million and $ 48.3 million for the nine months ended September 30, 2023 and October 1, 2022, respectively.

The Company recorded depreciation expense of $ 16.7 million and $ 17.6 million for the three months ended March 30, 2024 and April 1, 2023, respectively.

Goodwill and Other Intangible Assets

Changes in the carrying value of goodwill by segment for the nine months ended September 30, 2023 are as follows:

Changes in the carrying value of goodwill by segment for the three months ended March 30, 2024 are as follows:

(in thousands) Electronics Transportation Industrial Total

Net book value of goodwill as of December 31, 2022

Net goodwill as of December 30, 2023

Gross goodwill as of December 30, 2023

4 unchanged sentences

Changes during 2024:

Additions (a)

3,879 — 94,823 98,702

Currency translation 676 ( 1,616 ) ( 341 ) ( 1,281 )

Net book value of goodwill as of September 30, 2023

Gross goodwill as of September 30, 2023

Foreign currency translation adjustments ( 13,103 ) ( 2,003 ) ( 155 ) ( 15,261 )

Net goodwill as of March 30, 2024

Gross goodwill as of March 30, 2024

923,402 234,620 178,761 1,336,783

Accumulated impairment losses as of September 30, 2023

Accumulated impairment losses as of March 30, 2024

— ( 33,512 ) $ ( 8,534 ) ( 42,046 )

Total $ 923,402 $ 201,108 $ 170,227 $ 1,294,737

(a) The additions resulted from the acquisitions of Western Automation and measurement period adjustment related to the C&K acquisition.

The components of other intangible assets as of September 30, 2023 and December 31, 2022 are as follows:

As of September 30, 2023

The components of other intangible assets as of March 30, 2024 and December 30, 2023 are as follows:

As of March 30, 2024

(in thousands) Gross

12 unchanged sentences

Total $ 1,025,412 $ 419,276 $ 606,136

During the three months ended September 30, 2023 and October 1, 2022, the Company recorded amortization expense of $ 16.0 million and $ 15.6 million, respectively.

During the nine months ended September 30, 2023 and October 1, 2022, the Company recorded amortization expense of $ 49.8 million and $ 39.9 million, respectively.

During the nine months ended September 30, 2023, the Company recorded additions to intangible assets of $ 68.0 million, related to the Western Automation acquisition, the components of which were as follows:

(in thousands) Weighted Average Useful Life Amount

Patents, licenses, and software 6.7 $ 11,500

Customer relationships, trademarks, and tradenames 14.7 56,500

Total $ 68,000

Estimated annual amortization expense related to intangible assets with definite lives as of September 30, 2023 is as follows:

During the three months ended March 30, 2024 and April 1, 2023, the Company recorded amortization expense of $ 15.8 million and $ 16.9 million, respectively.

Estimated annual amortization expense related to intangible assets with definite lives as of March 30, 2024 is as follows:

(in thousands)

2023 $ 65,693

Remainder of 2024 $ 47,167

2029 and thereafter 324,089

1 unchanged sentence

Accrued Liabilities

The components of accrued liabilities as of September 30, 2023 and December 31, 2022 are as follows:

(in thousands) September 30, 2023 December 31, 2022

The components of accrued liabilities as of March 30, 2024 and December 30, 2023 are as follows:

(in thousands) March 30, 2024 December 30, 2023

Employee-related liabilities $ 56,285 $ 72,635

1 unchanged sentence

Other non-income taxes 7,828 7,855

Professional services 6,159 7,160

Other customer reserves 5,399 5,998

Professional services 5,229 5,282

Interest 3,191 6,387

Deferred revenue 2,126 2,593

Restructuring liability 2,081 2,141

Current benefit liability 1,482 1,482

Deferred revenue 1,400 2,198

Other 29,862 33,126

2 unchanged sentences

Bonus accruals include amounts earned pursuant to the Company’s primary employee incentive compensation plans.

Other accrued liabilities include miscellaneous operating accruals and other client-related liabilities.

Other accrued liabilities include miscellaneous operating accruals and other customer-related liabilities.

Restructuring, Impairment, and Other Charges

The Company recorded restructuring, impairment, and other charges for the three and nine months ended September 30, 2023 and October 1, 2022 as follows:

Three months ended September 30, 2023 Nine months ended September 30, 2023

(in thousands) Electronics Transportation Industrial Total Electronics Transportation Industrial Total

The Company recorded restructuring, impairment, and other charges for the three months ended March 30, 2024 and April 1, 2023 as follows:

Three Months Ended March 30, 2024

(in thousands) Electronics Transportation Industrial Total

Employee terminations $ 544 $ 1,190 $ 435 $ 2,169

3 unchanged sentences

Total $ 596 $ 2,201 $ 440 $ 3,237

Three months ended October 1, 2022 Nine months ended October 1, 2022

(in thousands) Electronics Transportation Industrial Total Electronics Transportation Industrial Total

Three Months Ended April 1, 2023

(in thousands) Electronics Transportation Industrial Total

Employee terminations $ 672 $ 582 $ 317 $ 1,571

1 unchanged sentence

Total $ 679 $ 854 $ 317 $ 1,850

For the three and nine months ended September 30, 2023, the Company recorded total restructuring charges of $ 3.7 million and $ 8.5 million, respectively, primarily for employee termination costs.

For the three months ended March 30, 2024, the Company recorded total restructuring charges of $ 2.3 million, primarily for employee termination costs.

These charges primarily related to the reorganization of certain manufacturing, selling and administrative functions within the Transportation segment’s commercial vehicle business, and the reorganization of certain selling and administrative functions within the Electronics and Industrial segments.

In addition, during the first quarter of 2024, the Company recognized a $ 0.9 million impairment charge related to certain machinery and equipment in the commercial vehicle business within the Transportation segment.

For the three months ended April 1, 2023, the Company recorded total restructuring charges of $ 1.9 million, primarily for employee termination costs.

These charges primarily related to the reorganization of certain manufacturing, selling and administrative functions within the Transportation segment’s commercial vehicle business and the reorganization of certain selling and administrative functions within the Electronics segment due to the C&K acquisition.

During the third quarter of 2023, the Company recognized a $ 0.8 million impairment charge substantially related to certain patents in a business within the Industrial segment.

In addition, during the second quarter of 2023, the Company recognized a $ 3.9 million impairment charge related to the land and building of a property in the commercial vehicle business within the Transportation segment that the Company made the decision to donate.

For the three and nine months ended October 1, 2022, the Company recorded total restructuring charges of $ 3.4 million and $ 4.3 million, respectively.

primarily for employee termination costs.

These charges are primarily related to the reorganization of certain manufacturing, selling and administrative functions within the passenger vehicle and automotive sensor businesses in the Transportation segment and the reorganization of selling and administrative functions due to the C&K acquisition within the Electronics segment.

The restructuring liability as of September 30, 2023 and December 31, 2022 is $ 2.1 million and $ 2.4 million, respectively.

The restructuring reserves as of both March 30, 2024 and December 30, 2023 is $ 2.1 million.

The restructuring liability is included within accrued liabilities in the Condensed Consolidated Balance Sheets.

The Company anticipates the remaining payments associated with employee terminations will primarily be completed in the third quarter fiscal year 2024.

The carrying amounts of debt at September 30, 2023 and December 31, 2022 are as follows:

(in thousands) September 30, 2023 December 31, 2022

The Company anticipates the remaining payments associated with employee terminations will primarily be completed in the fourth quarter fiscal year 2024.

The carrying amounts of debt at March 30, 2024 and December 30, 2023 are as follows:

(in thousands) March 30, 2024 December 30, 2023

Revolving credit facility $ 100,000 $ 100,000

Term loan 286,875 288,750

Euro Senior Notes, Series A due 2023 123,605 124,716

Euro Senior Notes, Series B due 2028 102,458 105,246

16 unchanged sentences

Loans made under the available credit facility pursuant to the Credit Agreement ("the Credit Facility") bear interest at the Company’s option, at either Secured Overnight Financing Rate ("SOFR"), fixed for interest periods of one, two, three or six-month periods, plus 1.00 % to 1.75 %, plus a SOFR adjustment of 0.10 % or at the bank’s Base Rate, as defined in the Credit Agreement, plus — % to 0.75 %, based upon the Company’s Consolidated Leverage Ratio, as defined in the Credit Agreement.

The Company is also required to pay commitment fees on unused portions of the Credit Facility ranging from 0.10 % to

0.175 %, based on the Consolidated Leverage Ratio, as defined in the Credit Agreement.

The Company is also required to pay commitment fees on unused portions of the Credit Facility ranging from 0.10 % to 0.175 %, based on the Consolidated Leverage Ratio, as defined in the Credit Agreement.

The Credit Agreement includes representations, covenants and events of default that are customary for financing transactions of this nature.

4 unchanged sentences

Subject to certain conditions, (i) the Company may terminate or reduce the Aggregate Revolving Commitments, as defined in the Credit Agreement, in whole or in part, and (ii) the Company may prepay the revolving loans or the term loans at any time, without premium or penalty.

During the three and nine months ended September 30, 2023, the Company made payments of $ 1.9 million and $ 5.6 million on its term loan, respectively.

The revolving loan and term loan balance under the Credit Facility was $ 100.0 million and $ 290.6 million, respectively, as of September 30, 2023.

During the three months ended March 30, 2024, the Company made payments of $ 1.9 million on its term loan.

The revolving loan and term loan balance under the Credit Facility was $ 100.0 million and $ 286.9 million, respectively, as of March 30, 2024.

On May 12, 2022, the Company entered into an interest rate swap agreement to manage interest rate risk exposure, effectively converting the interest rate on the Company's SOFR based floating-rate loans to a fixed-rate.

The interest rate swap, with a notional value of $ 200 million, was designated as a cash flow hedge against the variability of cash flows associated with the Company's SOFR based loans scheduled to mature on June 30, 2027.

As of September 30, 2023, the effective interest rate on revolving loan and term loan outstanding borrowings was 6.67 %.

As of September 30, 2023, the Company had $ 0.2 million outstanding letters of credit under the Credit Facility and had $ 599.8 million of borrowing capacity available under the revolving Credit Facility.

As of September 30, 2023, the Company was in compliance with all covenants under the Credit Agreement.

As of March 30, 2024, the effective interest rate on unhedged portion of the outstanding borrowings under the credit facility was 6.68 %, and 4.13 % on the hedged portion.

As of March 30, 2024, the Company had $ 0.2 million outstanding letters of credit under the Credit Facility and had $ 599.8 million of borrowing capacity available under the revolving credit facility.

As of March 30, 2024, the Company was in compliance with all covenants under the Credit Agreement.

On December 8, 2016, the Company entered into a Note Purchase Agreement, pursuant to which the Company issued and sold € 212 million aggregate principal amount of senior notes in two series.

The funding date for the Euro denominated senior notes occurred on December 8, 2016 for € 117 million in aggregate amount of 1.14 % Senior Notes, Series A, due December 8, 2023 (“Euro Senior Notes, Series A due 2023”), and € 95 million in aggregate amount of 1.83 % Senior Notes, Series B due December 8, 2028 (“Euro Senior Notes, Series B due 2028”) (together, the “Euro Senior Notes”).

Interest on the Euro Senior Notes is payable semiannually on June 8 and December 8, commencing June 8, 2017.

During the fourth quarter of 2023, the Company paid off € 117 million of Euro Senior Notes, Series A due on December 8, 2023.

Interest on the Euro Senior Notes due 2028 is payable semiannually on June 8 and December 8, commencing June 8, 2017.

On December 8, 2016, the Company entered into a Note Purchase Agreement, pursuant to which the Company issued and sold $ 125 million aggregate principal amount of senior notes in two series.

24 unchanged sentences

In addition, the Company is required to satisfy certain financial covenants and tests relating to, among other matters, interest coverage and leverage.

At September 30, 2023, the Company was in compliance with all covenants under the Senior Notes.

At March 30, 2024, the Company was in compliance with all covenants under the Senior Notes.

The Company may redeem the Senior Notes upon the satisfaction of certain conditions and the payment of a make-whole amount to noteholders and are required to offer to repurchase the Senior Notes at par following certain events, including a change of control.

Interest paid on all Company debt was $ 11.9 million and $ 8.5 million for the three months ended September 30, 2023 and October 1, 2022, respectively, and $ 33.2 million and $ 16.9 million for the nine months ended September 30, 2023 and October 1, 2022, respectively.

Interest paid on all Company debt was $ 13.2 million and $ 11.0 million for the three months ended March 30, 2024 and April 1, 2023, respectively.

Fair Value of Assets and Liabilities

16 unchanged sentences

The fair value of the interest rate swap was valued using an independent third-party valuation model.

Pursuant to this model, c hanges in fair value of derivatives that are designated as cash flow hedges are deferred in accumulated other comprehensive loss u ntil the underlying transactions are recognized in

The primary inputs into the valuation of the interest rate swap are interest yield curves, interest rate volatility, credit risk, credit spreads and other market information.

1 unchanged sentence

The use of derivatives creates exposure to credit risk relating to potential losses that could be recognized in the event that the counterparties to these instruments fail to perform their obligations under the contracts.

The Company seeks to minimize this risk by limiting our counterparties to major financial institutions with acceptable credit ratings and monitoring the total value of positions with individual counterparties.

In the event of a default by one of our counterparties, the Company may not receive payments provided for under the terms of our derivatives.

The Company seeks to minimize this risk by limiting its counterparties to major financial institutions with acceptable credit ratings and monitoring the total value of positions with individual counterparties.

In the event of a default by one of its counterparties, the Company may not receive payments provided for under the terms of its derivatives.

Derivatives Not Designated as Hedging Instruments

1 unchanged sentence

dollar on its Euro denominated Senior Notes, Series A due 2023.

The notional value of the forward contract at July 14, 2022 was € 117.0 million and expires on December 7, 2023.

The foreign currency contract was not designated as a hedge instrument and is marked to market on a monthly basis.

As a result, changes in fair value are reported in Foreign exchange loss in the Condensed Consolidated Statements of Operations.

The notional value of the forward contract at July 14, 2022 was € 117.0 million and expired on December 7, 2023 with the final settlement value of $ 6.3 million which the Company used to convert USD to Euro to pay down the € 117.0 million of Euro Senior Notes, Series A due 2023.

The foreign currency contract was not designated as a hedge instrument and was marked to market on a monthly basis.

As a result, changes in fair value during 2023 were reported in Foreign exchange gain in the Condensed Consolidated Statements of Net Income.

The fair value of the foreign currency forward contract was valued using market exchange rates by a third party and classified as a Level 2 input under the fair value hierarchy.

As of September 30, 2023 and December 31, 2022, the fair values of our derivative financial instrument and their classifications on the Condensed Consolidated Balance Sheets were as follows:

(in thousands) Consolidated Balance Sheet Classification September 30, 2023 December 31, 2022

As of March 30, 2024 and December 30, 2023, the fair values of the Company's derivative financial instrument and their classifications on the Condensed Consolidated Balance Sheets were as follows:

(in thousands) Condensed Consolidated Balance Sheet Classification March 30, 2024 December 30, 2023

Derivatives designated as hedging instruments

2 unchanged sentences

Other long-term assets $ 4,434 $ 2,140

Derivatives Not Designated as Hedging Instruments

Foreign exchange forward contract Prepaid expenses and other current assets $ 2,862 $ 6,186

The pre-tax (gains) losses recognized on derivative financial instruments in the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2023 and October 1, 2022 were as follows:

Three Months Ended Nine Months Ended

(in thousands) Classification of (Gain) Loss Recognized in the

Condensed Consolidated Statements of Operations September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

The pre-tax gains recognized on derivative financial instruments in the Condensed Consolidated Statements of Net Income for the three months ended March 30, 2024 and April 1, 2023 were as follows:

Three Months Ended

(in thousands) Classification of Gain Recognized in the Condensed Consolidated Statements of Net Income March 30, 2024 April 1, 2023

Derivatives designated as cash flow hedges

Interest rate swap agreement Interest expense, net $ ( 1,252 ) $ 314 $ ( 3,246 ) $ 335

Interest rate swap agreement Interest expense $ ( 1,280 ) $ ( 975 )

Derivatives not designated as hedging instruments

Foreign exchange forward contract Foreign exchange loss $ 4,310 $ 3,209 $ 3,226 $ 3,209

The pre-tax gains recognized on derivative financial instruments in the Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2023 and October 1, 2022 was as follows:

Three Months Ended Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Foreign exchange forward contract Foreign exchange gain $ — $ ( 819 )

The pre-tax (gains) recognized on derivative financial instruments in the Condensed Consolidated Statements of Comprehensive Income for the three months ended March 30, 2024 and April 1, 2023 was as follows:

Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

Derivatives designated as cash flow hedges

4 unchanged sentences

The marketable securities are classified as Level 1 under the fair value hierarchy as they are maintained in mutual funds with readily determinable fair value and recorded in Other long-term assets .

There we re no changes during the quarter ended September 30, 2023 to the Company’s valuation techniques used to measure asset and liability fair values o n a recurring basis.

As of September 30, 2023 and December 31, 2022, the Company did not hold any non-financial assets or liabilities that are required to be measured at fair value on a recurring basis.

The following table presents assets measured at fair value by classification within the fair value hierarchy as of September 30, 2023:

There we re no changes during the quarter ended March 30, 2024 to the Company’s valuation techniques used to measure asset and liability fair values o n a recurring basis.

As of March 30, 2024 and December 30, 2023, the Company did not hold any non-financial assets or liabilities that are required to be measured at fair value on a recurring basis.

The following table presents assets measured at fair value by classification within the fair value hierarchy as of March 30, 2024:

Fair Value Measurements Using

24 unchanged sentences

Due to their short-term maturity, the carrying amounts of cash and cash equivalents, short-term investments and accounts receivable approximate their fair values.

The Company’s revolving and term

loan debt facilities' fair values approximate book value at September 30, 2023 and December 31, 2022, as the rates on these borrowings are variable in nature.

The carrying value and estimated fair values of the Company’s Euro Senior Notes, Series A and Series B and USD Senior Notes, Series A and Series B, as of September 30, 2023 and December 31, 2022 were as follows:

September 30, 2023 December 31, 2022

The Company’s revolving and term loan debt facilities' fair values approximate book value at March 30, 2024 and December 30, 2023, as the rates on these borrowings are variable in nature.

The carrying value and estimated fair values of the Company’s Euro Senior Notes, Series A and Series B and USD Senior Notes, Series A and Series B, as of March 30, 2024 and December 30, 2023 were as follows:

March 30, 2024 December 30, 2023

(in thousands) Carrying

2 unchanged sentences

Value Estimated

Euro Senior Notes, Series A due 2023 $ 123,605 $ 122,830 $ 124,716 $ 122,270

Euro Senior Notes, Series B due 2028 $ 102,458 $ 93,470 $ 105,246 $ 96,532

6 unchanged sentences

The amount of the retirement benefits provided under the plans is generally based on years of service and final average pay.

The Company recognizes interest cost, expected return on plan assets, and amortization of prior service, net within Other (income) expense, net in the Condensed Consolidated Statements of Net Income.

The components of net periodic benefit cost for the three and nine months ended September 30, 2023 and October 1, 2022 were as follows:

For the Three Months Ended For the Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

The Company recognizes interest cost, expected return on plan assets, and amortization of prior service, net within Other income, net in the Condensed Consolidated Statements of Net Income.

The components of net periodic benefit cost for the three months ended March 30, 2024 and April 1, 2023 were as follows:

For the Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

Components of net periodic benefit cost:

6 unchanged sentences

The Company also sponsors certain post-employment plans in foreign countries and other statutory benefit plans.

The Company recorded expense of $ 0.4 million and $ 0.5 million for the three months ended September 30, 2023 and October 1, 2022 , respectively, and $ 1.1 million and $ 1.5 million for the nine months ended September 30, 2023 and October 1, 2022, respectively, in Cost of Sales and Other (income) expense, net within the Condensed Consolidated Statements of Net Income.

The pre-tax (gains) losses amount recognized in other comprehensive (loss) income as components of net periodic benefit costs for these plans were nominal and $ 0.1 million for the three months ended September 30, 2023 and October 1, 2022, respectively, and $( 0.1 ) million and $ 0.3 million f or the nine months ended September 30, 2023 and October 1, 2022, respectively.

Other Comprehensive (Loss) Income

Changes in other comprehensive (loss) income by component were as follows:

The Company recorded expense of $ 0.7 million and $ 0.4 million for the three months ended March 30, 2024 and April 1, 2023 , respectively, in Cost of Sales and Other income, net within the Condensed Consolidated Statements of Net Income.

The pre-tax (gains) losses amount recognized in other comprehensive income (loss) as components of net periodic benefit costs for these plans were $ 0.3 million and nominal for the three months ended March 30, 2024 and April 1, 2023, respectively.

Other Comprehensive Income (Loss)

Changes in other comprehensive income (loss) by component were as follows:

(in thousands) Three Months Ended

September 30, 2023 Three Months Ended

October 1, 2022

March 30, 2024 Three Months Ended

April 1, 2023

Pre-tax Tax Net of Tax Pre-tax Tax Net of Tax

3 unchanged sentences

Total change in other comprehensive (loss) income $ ( 30,276 ) $ ( 15 ) $ ( 30,291 ) $ 12,779 $ 504 $ 13,283

(in thousands) Nine Months Ended

September 30, 2023 Nine Months Ended

October 1, 2022

Pre-tax Tax Net of Tax Pre-tax Tax Net of Tax

Defined benefit pension plan and other adjustments $ ( 125 ) $ ( 31 ) $ ( 156 ) $ 1,718 $ ( 170 ) $ 1,548

Cash flow hedge 2,817 ( 676 ) 2,141 9,300 ( 2,232 ) 7,068

Foreign currency translation adjustments (a) ( 6,098 ) 351 ( 5,747 ) ( 72,671 ) 2,315 ( 70,356 )

Total change in other comprehensive loss $ ( 3,406 ) $ ( 356 ) $ ( 3,762 ) $ ( 61,653 ) $ ( 87 ) $ ( 61,740 )

(a) The tax shown above within the foreign currency translation adjustments is the U.S.

2 unchanged sentences

and are not permanently reinvested.

The following tables set forth the changes i n accumulated other comprehensive loss by compon ent for the nine months ended September 30, 2023 and October 1, 2022:

The following tables set forth the changes i n accumulated other comprehensive loss by compon ent for the three months ended March 30, 2024 and April 1, 2023:

(in thousands) Defined benefit pension plan and other adjustments Cash flow hedge Foreign currency

3 unchanged sentences

Activity in the period 344 1,926 ( 32,561 ) ( 30,291 )

Balance at September 30, 2023 $ ( 2,349 ) $ 8,737 $ ( 105,914 ) $ ( 99,526 )

Balance at March 30, 2024 $ ( 7,269 ) $ 6,374 $ ( 85,213 ) $ ( 86,108 )

(in thousands) Defined benefit pension plan and other adjustments Cash flow hedge Foreign currency translation adjustment Accumulated other comprehensive loss

Balance at January 1, 2022 $ ( 11,928 ) $ — $ ( 61,535 ) $ ( 73,463 )

Balance at December 31, 2022 $ ( 2,193 ) $ 6,596 $ ( 100,167 ) $ ( 95,764 )

Activity in the period 6 ( 2,518 ) 15,795 13,283

Balance at October 1, 2022 $ ( 10,380 ) $ 7,068 $ ( 131,891 ) $ ( 135,203 )

Amounts reclassified from accumulated other comprehensive loss to e arnings for the three and nine months ended September 30, 2023 and October 1, 2022 were as follows:

Three Months Ended Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Balance at April 1, 2023 $ ( 2,187 ) $ 4,078 $ ( 84,372 ) $ ( 82,481 )

Amounts reclassified from accumulated other comprehensive loss to e arnings for the three months ended March 30, 2024 and April 1, 2023 were as follows:

Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

Pension and postemployment plans:

Amortization of prior service and net actuarial (gain) loss $ ( 11 ) $ 193 $ ( 33 ) $ 588

The Company recognizes the amortization of prior service costs in Other (income) expense, net within the Condensed Consolidated Statements of Net Income.

The effective tax rate for the three and nine months ended September 30, 2023 was 23.3 % and 19.7 %, respectively, compared to the effective tax rate for the three and nine months ended October 1, 2022 of 21.4 % and 17.6 %, respectively.

The effective tax rate for the third quarter of 2023 is higher than the effective tax rate for the comparable 2022 period, primarily due to less income earned in lower tax jurisdictions in the 2023 period, as compared to the 2022 period.

The effective tax rates for both periods are higher than the statutory tax rate due to the impact of foreign exchange losses with no related tax benefit.

The effective tax rate for the first nine months of 2023 is higher than the effective tax rate for the comparable 2022 period, primarily due to the impact of a one-time deduction in the first quarter of 2022 that resulted in a net benefit of $ 7.2 million from the dissolution of one of the Company’s affiliates.

The effective tax rates for both periods were lower than the applicable U.S.

statutory tax rate primarily due to income earned in lower tax jurisdictions, while for the 2022 period, the effective tax rate was also lower due to the impact of the one-time deduction previously noted.

Amortization of prior service and net actuarial loss (gain) $ 356 $ ( 11 )

The Company recognizes the amortization of prior service costs in Other income, net within the Condensed Consolidated Statements of Net Income.

The effective tax rate for the three months ended March 30, 2024 was 13.0 %, compared to the effective tax rate for the three months ended April 1, 2023 of 18.5 %.

The effective tax rate for the first quarter of 2024 is lower than the effective tax rate for the comparable 2023 period primarily due to the lapse in the statute of limitations for previously unrecognized tax benefits.

The effective tax rate for 2023 is lower than the statutory tax rate primarily due to income earned in lower tax jurisdictions, and the effective tax rate for 2024 is lower than the statutory tax rate primarily due to the lapse in the statute of limitations for previously unrecognized tax benefits.

Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share:

Three Months Ended Nine Months Ended

(in thousands, except per share amounts) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Three Months Ended

(in thousands, except per share amounts) March 30, 2024 April 1, 2023

Net income as reported $ 48,452 $ 88,745

6 unchanged sentences

Diluted earnings per share $ 1.93 $ 3.54

Potential shares of common stock relating to stock options and restricted share units excluded from the earnings per share calculation because their effect would be anti-dilutive were 80,828 and 92,052 for the three months ended September 30, 2023 and October 1, 2022, respectively, and 106,156 and 84,027 for the nine months ended September 30, 2023 and October 1, 2022, respectively.

Potential shares of common stock relating to stock options and restricted share units excluded from the earnings per share calculation because their effect would be anti-dilutive were 175,411 and 90,297 for the three months ended March 30, 2024 and April 1, 2023, respectively.

Share Repurchase Program

On April 28, 2021, the Company announced that the Board of Directors authorized a new three year program to repurchase up to $ 300.0 million in the aggregate of shares of the Company’s common stock for the period May 1, 2021 to April 30, 2024 to replace its previous 2020 program.

The Company did no t repurchase shares of its common stock for the three and nine months ended September 30, 2023, and October 1, 2022.

Related Party Transactions

The Company has equity ownership in various investments that are accounted for under the equity method.

The following is a description of the investments and related party transactions.

Powersem GmbH:

The Company owns 45 % of the outstanding equity of Powersem GmbH (“Powersem”), a module manufacturer based in Germany.

EB-Tech Co., Ltd.:

The Company owns approximately 19 % of the outstanding equity of EB Tech Co., Ltd.

(“EB Tech”), a company with expertise in radiation technology based in South Korea.

Automated Technology (Phil), Inc.

The Company owns approximately 24 % of the outstanding common shares of Automated Technology (Phil), Inc.

(“ATEC”), a supplier located in the Philippines that provides assembly and test services.

One member of the Company's Board of Directors serves on the Board of Directors of ATEC.

Three Months Ended September 30, 2023 Three Months Ended October 1, 2022

(in millions) Powersem EB-Tech ATEC Powersem EB Tech ATEC

Sales to related party $ 0.5 $ — $ — $ — $ — $ —

Purchase material/service from related party 1.2 0.1 2.0 — 0.1 2.9

Nine Months Ended September 30, 2023 Nine Months Ended October 1, 2022

(in millions) Powersem EB-Tech ATEC Powersem EB Tech ATEC

Sales to related party $ 1.7 $ — $ — $ — $ — $ —

Purchase material/service from related party 3.3 0.3 7.6 0.3 0.3 8.8

September 30, 2023 December 31, 2022

(in millions) Powersem EB Tech ATEC Powersem EB Tech ATEC

Accounts payable balance $ 0.8 $ — $ 1.6 $ — $ — $ 1.8

The Company’s Board of Directors authorized the repurchase of up to $ 300.0 million in the aggregate of shares of the Company’s common stock for the period May 1, 2021 to April 30, 2024 (2021 program).

During the three months ended March 30, 2024, the Company repurchased 70,280 shares of its common stock totaling $ 16.1 million.

The Company did no t repurchase shares of its common stock for the three months ended April 1, 2023.

On April 25, 2024, the Company announced that the Board of Directors authorized a new three year program to repurchase up to $ 300.0 million in the aggregate of shares of the Company's stock for the period May 1, 2024 to April 30, 2027 to replace its 2021 program.

Segment Information

17 unchanged sentences

and insulated gate bipolar transistors (“IGBT”) technologies.

medical devices, alternative energy and energy storage, building and home automation, appliances, and mobile electronics.

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:

5 unchanged sentences

Segment information is summarized as follows:

Three Months Ended Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

Electronics $ 291,105 $ 358,593

7 unchanged sentences

Total depreciation and amortization $ 32,493 $ 34,482

Operating income

Operating income (loss)

Electronics $ 37,803 $ 90,162

4 unchanged sentences

Interest expense 9,611 9,646

Foreign exchange loss 11,776 18,191 8,697 40,051

Other (income) expense, net ( 3,527 ) ( 698 ) ( 11,810 ) 9,789

Foreign exchange gain ( 5,042 ) ( 1,675 )

Other income, net ( 5,321 ) ( 6,233 )

Income before income taxes $ 55,704 $ 108,903

(a) Included in “Other” Operating income for the third quarter of 2023 was $ 3.7 million ($ 8.5 million year-to-date) of restructuring charges, primarily related to employee termination costs, and $ 1.8 million ($ 9.0 million year-to-date) of legal and professional fees and other integration expenses related to completed and contemplated acquisitions.

During the third quarter of 2023, the Company recognized a $ 0.8 million impairment charge substantially related to certain patents in a business within the Industrial segment.

In addition, during the second quarter of 2023, the Company recognized a $ 3.9 million impairment charge related to the land and building in the commercial vehicle business within the Transportation segment.

(a) Included in “Other” Operating income for the first quarter of 2024 was $ 2.3 million of restructuring charges primarily related to employee termination costs and a $ 0.9 million impairment charge related to certain machinery and equipment in the commercial vehicle business within the Transportation segment.

See Note 7, Restructuring, Impairment, and Other Charges, for further discussion.

Included in “Other” Operating income for the third quarter of 2022 was $ 6.8 million ($ 11.6 million year-to-date) of purchase accounting inventory step-up charges, $ 6.2 million ($ 14.8 million year-to-date) of legal and professional fees and other integration expenses related to completed and contemplated acquisitions, and $ 3.4 million ($ 4.3 million year-to-date) of restructuring, impairment and other charges, primarily related to employee termination costs.

In addition, during the first quarter of 2024, the Company recognized $ 0.9 million of legal and professional fees and other integration expenses related to completed and contemplated acquisitions, partially offset by a gain of $ 0.3 million recorded for the sale of a building in the commercial vehicle business within the Transportation segment.

Included in “Other” Operating income for the first quarter of 2023 was $ 3.3 million of legal and professional fees and other integration expenses related to completed acquisitions, and $ 1.9 million of restructuring, impairment and other charges, primarily related to employee termination costs.

See Note 7, Restructuring, Impairment, and Other Charges, for further discussion.

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

Three Months Ended Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

The Company’s net sales by country were as follows, classified according to the country where the customer is located:

Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

United States $ 190,433 $ 212,195

3 unchanged sentences

Total net sales $ 535,385 $ 609,782

The Company’s long-lived assets by country were as follows:

(in thousands) September 30, 2023 December 31, 2022

The Company’s long-lived assets represent Net property, plant, and equipment, and are classified according to the country where the asset is located were as follows:

(in thousands) March 30, 2024 December 30, 2023

Long-lived assets

7 unchanged sentences

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

Nine Months Ended

(in thousands) September 30, 2023 October 1, 2022

Three Months Ended

(in thousands) March 30, 2024 April 1, 2023

Additions to long-lived assets

7 unchanged sentences

(a) Each country included in other countries is less than 10% of net sales.

Commitments and Contingencies

Off-Balance Sheet Arrangements

As of March 30, 2024, the Company did not have any off-balance sheet arrangements, as defined under SEC rules.

Specifically, the Company was not liable for guarantees of indebtedness owed by third parties, the Company was not directly liable for the debt of any unconsolidated entity and the Company did not have any retained or contingent interest in assets.

The Company does not participate in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities.

Product Warranty Liabilities

The company's policy is to accrue for warranty claims when a loss is both probable and estimable.

Liabilities for warranty claims have historically not been material and in limited instances, customers may make claims for costs they incurred or other damages related to a claim.

The Company carries insurance for potential product liability claims at coverage levels based on the Company's prior claims experience.

This coverage is subject to deductibles, and various terms and conditions.

The Company cannot assure that the level of coverage will be sufficient to cover every possible claim that can arise in its businesses, now or in the future, or that such coverage always will be available should the Company, now or in the future, wish to extend, increase or otherwise adjust its insurance.

The Company has been notified by one of its customers of a product recall potentially due to certain fuses provided by Littelfuse and incorporated in such products.

The Company is currently working with its customer to investigate the cause and level of responsibility for this recall.

The Company has determined pursuant to ASC 450, "Contingencies ", that a loss is reasonably possible.

However, the Company continues to evaluate this matter and the ultimate costs of the recall and range of the potential loss cannot be determined at this time.

Accordingly, no accrual has been made yet for this matter.

Factors that will impact the amount of such losses include the per vehicle cost of fuse replacement, the determination of the relative liability among the customer, the Company, and any relevant third parties, as well as actual insurance recoveries .

Environmental Remediation Liabilities

The company's operations and facilities are subject to U.S.

laws and regulations governing the protection of the environment and its employees, including those governing air emissions, chemical usage, water discharges, the management and disposal of hazardous substances and wastes, and the cleanup of contaminated sites.

The Company could incur significant costs, including cleanup costs, fines, civil or criminal sanctions, or third-party property damage or personal injury claims, in the event of violations or liabilities under these laws and regulations, or non-compliance with the environmental permits required at its facilities.

Potentially significant expenditures could be required in order to comply with environmental laws that may be adopted or imposed in the future.

The Company is, however, not aware of any threatened or pending material environmental investigations, lawsuits, or claims involving the Company or its operations.

Legal Proceedings

In the ordinary course of business, the Company may be involved in a number of claims and litigation matters.

While it is not feasible to predict the outcome of these matters, based upon the Company's experience and current information known, the Company does not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on its results of operations, financial position, and/or cash flows.

The Company accounts for litigation and claims losses in accordance with ASC 450, "Contingencies " where loss contingency provisions are recognized for probable and estimable losses at the Company's best estimate of a loss or, when a best estimate cannot be made, at its estimate of the minimum loss.

These estimates require the application of considerable judgment and are refined each accounting period as additional information becomes known.

If the Company is initially unable to develop a best estimate of loss and therefore the minimum amount, which could be an immaterial amount, is recognized.

As information becomes known, either the minimum loss amount is increased, or a best estimate can be made, resulting in additional loss provisions.

A best estimate may be changed when events result in an expectation different than previously expected.

Pending Litigation and Claims

There are no material pending litigation or claims outstanding as of March 30, 2024.

Related Party Transactions

The Company has equity ownership in various investments that are accounted for under the equity method.

The following is a description of the investments and related party transactions.

Powersem GmbH:

The Company owns 45 % of the outstanding equity of Powersem GmbH (“Powersem”), a module manufacturer based in Germany.

EB-Tech Co., Ltd.:

The Company owns approximately 19 % of the outstanding equity of EB Tech Co., Ltd.

(“EB Tech”), a company with expertise in radiation technology based in South Korea.

Automated Technology (Phil), Inc.

The Company owns approximately 24 % of the outstanding common shares of Automated Technology (Phil), Inc.

(“ATEC”), a supplier located in the Philippines that provides assembly and test services.

One member of the Company's Board of Directors serves on the Board of Directors of ATEC.

Three Months Ended March 30, 2024 Three Months Ended April 1, 2023

(in millions) Powersem EB Tech ATEC Powersem EB Tech ATEC

Sales to related party $ 0.5 $ — $ — $ 0.5 $ — $ —

Purchase material/service from related party 1.2 0.2 2.1 1.0 0.1 2.7

March 30, 2024 December 30, 2023

(in millions) Powersem EB Tech ATEC Powersem EB Tech ATEC

Accounts receivable balance $ 0.1 $ — $ — $ — $ — $ —

Accounts payable balance $ 0.8 $ 0.1 $ 1.5 $ 0.5 $ — $ 1.0

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements