lfus_10q-033013.htm
UNITED STATES
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, 2013

OR

 
[   ]
TRANSITION REPORT PURSUANT TO SECTION 13 OR 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 Identification No.)
of incorporation or organization)
   
     
8755 W. Higgins Road, Suite 500
   
Chicago, Illinois
 
60631
(Address of principal executive offices)
 
(Zip Code)

(773) 628-1000
(Registrant’s telephone number, including area code)

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 submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes [X]  No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check one):

Large accelerated filer [X]                                                               Accelerated filer [  ]                                 Non-accelerated filer [  ]                                        Smaller reporting company [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes [  ]  No [X]

As of April 26, 2013, 22,106,477 shares of common stock, $.01 par value, of the registrant were outstanding.
 
 
 

 

TABLE OF CONTENTS

 
 
Page
       
PART I - FINANCIAL INFORMATION    
       
Item 1.
Financial Statements.
   
       
 
Condensed Consolidated Balance Sheets as of March 30, 2013 (unaudited) and December 29, 2012
1
 
       
 
Consolidated Statements of Net Income for the three months ended March 30, 2013 (unaudited) and March 31, 2012 (unaudited)
2
 
       
 
Consolidated Statements of Comprehensive Income for the three months ended March 30, 2013 (unaudited) and March 31, 2012 (unaudited)
3
 
       
 
Consolidated Statements of Cash Flows for the three months ended March 30, 2013 (unaudited) and March 31, 2012 (unaudited)
4
 
       
 
Notes to Condensed Consolidated Financial Statements (unaudited)
5
 
       
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
14
 
       
Item 3.
Quantitative and Qualitative Disclosures About Market Risk.
17
 
       
Item 4.
Controls and Procedures.
18
 
       
PART II - OTHER INFORMATION    
       
Item 1.
Legal Proceedings
19
 
       
Item 1A.
Risk Factors
19
 
       
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
19
 
       
Item 3.
Defaults Upon Senior Securities
19
 
       
Item 4.
Mine Safety Disclosures
19
 
       
Item 5.
Other Information
19
 
       
Item 6.
Exhibits
20
 
       
Signatures
21
 
 
 
 

 
 
PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

LITTELFUSE, INC.
Condensed Consolidated Balance Sheets
(In thousands of USD, except share amounts)

   
March 30, 2013
   
December 29, 2012
 
   
(unaudited)
       
ASSETS
           
Current assets:
           
Cash and cash equivalents
  $ 246,895     $ 235,404  
Short-term investments
    8,344        
Accounts receivable, less allowances
    107,044       100,559  
Inventories
    71,372       75,580  
Deferred income taxes
    10,874       11,890  
Prepaid expenses and other current assets
    15,857       16,532  
Assets held for sale
    5,500       5,500  
Total current assets
    465,886       445,465  
Property, plant and equipment:
               
Land
    6,328       6,243  
Buildings
    55,159       54,559  
Equipment
    309,975       304,954  
      371,462       365,756  
Accumulated depreciation
    (251,162 )     (244,845 )
Net property, plant and equipment
    120,300       120,911  
Intangible assets, net of amortization:
               
Patents, licenses and software
    10,521       11,144  
Distribution network
    18,243       18,964  
Customer lists, trademarks and tradenames
    17,738       18,704  
Goodwill
    131,850       133,592  
Investment in unconsolidated affiliate
          8,666  
Other investments
    11,572       10,327  
Deferred income taxes
    9,826       8,090  
Other assets
    1,878       1,865  
                 
Total assets
  $ 787,814     $ 777,728  
                 
LIABILITIES AND EQUITY
               
Current liabilities:
               
Accounts payable
  $ 29,582     $ 27,226  
Accrued payroll
    13,374       20,540  
Accrued expenses
    9,703       11,062  
Accrued severance
    776       1,033  
Accrued income taxes
    8,196       11,559  
Current portion of long-term debt
    94,000       84,000  
Total current liabilities
    155,631       155,420  
Accrued post-retirement benefits
    17,692       22,338  
Other long-term liabilities
    13,820       12,412  
Total equity
    600,671       587,558  
                 
Total liabilities and equity
  $ 787,814     $ 777,728  
                 
Common shares issued and outstanding of 22,145,423 and 22,029,446, at March 30, 2013, and December 29, 2012, respectively.
               

See accompanying notes.
 
 
1

 

LITTELFUSE, INC.
Consolidated Statements of Net Income
(In thousands of USD, except per share amounts, unaudited)

   
For the Three Months Ended
 
   
March 30, 2013
   
March 31, 2012
 
             
Net sales
  $ 170,918     $ 160,578  
                 
Cost of sales
    106,312       99,716  
                 
Gross profit
    64,606       60,862  
                 
Selling, general and administrative expenses
    29,202       28,409  
Research and development expenses
    5,715       5,161  
Amortization of intangibles
    1,572       1,468  
      36,489       35,038  
                 
Operating income
    28,117       25,824  
                 
Interest expense
    376       423  
Impairment and equity in net loss of unconsolidated affiliate
    10,678       525  
Other (income) expense, net
    (909 )     101  
                 
Income before income taxes
    17,972       24,775  
Income taxes
    3,178       7,212  
                 
Net income
  $ 14,794     $ 17,563  
                 
Net income per share (see note 9):
               
Basic
  $ 0.67     $ 0.81  
Diluted
  $ 0.66     $ 0.80  
                 
Weighted average shares and equivalent shares outstanding:
               
Basic
    22,095       21,608  
Diluted
    22,366       21,929  
                 
Cash dividends paid per common share
  $ 0.20     $ 0.18  
 
See accompanying notes.

 
2

 

LITTELFUSE, INC.
Consolidated Statements of Comprehensive Income
(In thousands of USD, unaudited)
 
   
For the Three Months Ended
 
   
March 30, 2013
   
March 31, 2012
 
             
Net income
  $ 14,794     $ 17,563  
Other comprehensive income (loss):
               
Pension liability adjustments (net of tax of $103 and $45, respectively)
    (194 )     (66 )
Unrealized gain on investments
    1,618       1,812  
Foreign currency translation adjustments
    (5,250 )     7,396  
Comprehensive income
  $ 10,968     $ 26,705  
 
See accompanying notes.
 
3

 

LITTELFUSE, INC.
Consolidated Statements of Cash Flows
(In thousands of USD, unaudited)

   
For the Three Months Ended
 
   
March 30, 2013
   
March 31, 2012
 
OPERATING ACTIVITIES:
           
Net income
  $ 14,794     $ 17,563  
Adjustments to reconcile net income to net cash provided by operating activities:
               
Depreciation
    6,232       6,481  
Amortization of intangibles
    1,572       1,468  
Stock-based compensation
    1,779       1,365  
Non-cash inventory charge
          205  
Excess tax benefit on share-based compensation
    (467 )     (475 )
(Gain) loss on sale of assets
    (24 )     7  
Impairment and equity in net loss of unconsolidated affiliate
    10,678       525  
Changes in operating assets and liabilities:
               
Accounts receivable
    (9,745 )     (14,017 )
Inventories
    3,632       (1,713 )
Accounts payable
    2,452       8,552  
Accrued expenses (including post-retirement)
    (4,619 )     (5,543 )
Accrued payroll and severance
    (7,319 )     (7,728 )
Accrued taxes
    (3,946 )     1,275  
Prepaid expenses and other
    1,026       (101 )
Net cash provided by operating activities
    16,045       7,864  
                 
INVESTING ACTIVITIES:
               
Purchases of property, plant, and equipment
    (5,453 )     (3,244 )
Purchase of short-term investments
    (8,478 )     (4,616 )
Proceeds from sale of assets
    9       21  
Net cash used in investing activities
    (13,922 )     (7,839 )
                 
FINANCING ACTIVITIES:
               
Proceeds from revolving credit facility
    15,000       17,000  
Payments of revolving credit facility
    (5,000 )     (5,500 )
Cash dividends paid
    (4,410 )     (3,888 )
Proceeds from exercise of stock options
    5,283       4,217  
Excess tax benefit on share-based compensation
    467       475  
Net cash provided by financing activities
    11,340       12,304  
                 
Effect of exchange rate changes on cash and cash equivalents
    (1,972 )     2,347  
                 
Increase in cash and cash equivalents
    11,491       14,676  
Cash and cash equivalents at beginning of period
    235,404       164,016  
Cash and cash equivalents at end of period
  $ 246,895     $ 178,692  
 
See accompanying notes.
 
 
4

 
 
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements of Littelfuse, Inc. and its subsidiaries (the “company”) have been prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP) for interim financial information, the instructions to Form 10-Q and Article 10 of Regulations S-X. Accordingly, certain information and disclosures normally included in the consolidated balance sheet, statements of net income and comprehensive income and cash flows prepared in conformity with U.S. GAAP have been condensed or omitted as permitted by such rules and regulations. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the period ended March 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 28, 2013. 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, 2012. The company evaluated subsequent events through the date of its financial statements when filed with the Securities and Exchange Commission (“SEC”).

2. Reclassifications and Adjustments

As disclosed in the Annual Report on Form 10-K for the year ended December 29, 2012, the company determined that in late-November 2012 it began to exercise significant influence over Shocking Technologies (“Shocking”). Accordingly, the company began accounting for the investment in Shocking using the equity method and in accordance with ASC 323, retroactively recorded its proportional share of Shocking's operating losses, which amounted to approximately $4.0 million in 2012. See Note 6 for additional information related to Shocking.

As a result of this retroactive application of the equity method, certain items in the company’s interim results reported on their 2012 Forms 10-Q have been retrospectively restated, as shown in the following tables:
 
   
March 31, 2012
 
Consolidated Statements of Net Income and Comprehensive Income
 
As Previously
Reported
   
Adjustment
   
As Adjusted
 
                   
Impairment and equity in net loss of unconsolidated affiliate
  $     $ 525     $ 525  
Income before income taxes
    25,300       (525 )     24,775  
Income taxes
    7,411       (199 )     7,212  
Net income
    17,889       (326 )     17,563  
Basic Earnings per share
  $ 0.83     $ (0.02 )   $ 0.81  
Diluted Earnings per share
  $ 0.81     $ (0.01 )   $ 0.80  
Comprehensive income
  $ 27,031     $ (326 )   $ 26,705  

   
March 31, 2012
 
Consolidated Statements of Cash Flows
 
As Previously
Reported
   
Adjustment
   
As Adjusted
 
                   
Net income
  $ 17,889     $ (326 )   $ 17,563  
Impairment and equity in net loss of unconsolidated affiliate
          525       525  
Accrued taxes
    1,474       (199 )     1,275  

 
5

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3. Acquisition of Businesses

Accel AB

On May 31, 2012, the company acquired 100% of ACCEL AB (“Accel”), a manufacturer of advanced electromechanical products, including sensors and switches primarily for the automotive industry, for approximately $23.9 million. The acquisition allows the company to expand its automotive product offering and establish a presence in the growing automotive sensor market within its Automotive business unit segment. Accel is based in Vänersborg, Sweden with a manufacturing facility located in Kaunas, Lithuania. The company funded the acquisition with available cash.

The following table sets forth the purchase price allocation, as of March 30, 2013, for Accel acquisition-date net assets, in accordance with the purchase method of accounting with adjustments to record the acquired net assets at their estimated fair values.
 
Accel AB purchase price allocation (in thousands):
 
Cash
  $ 344  
Current assets, net
    8,643  
Property, plant and equipment
    3,731  
Other assets
    7  
Goodwill
    11,536  
Distribution network
    1,321  
Trademarks
    1,259  
Patents and licenses
    2,435  
Current liabilities
    (5,411 )
    $ 23,865  

All Accel goodwill and other assets and liabilities were recorded in the Automotive business unit segment and reflected in the Europe geographical area. The distribution network is being amortized over three to 10 years. Trademarks are being amortized over five years. Patents and licenses are being amortized over 10 years. The goodwill resulting from this acquisition consists largely of the company’s expected future product sales and synergies from combining Accel’s products with the company’s existing product offerings. Goodwill for the above acquisition is not expected to be deductible for tax purposes.

As required by purchase accounting rules, the company recorded a $0.4 million step-up of inventory to its fair value as of the acquisition date. During the third quarter of 2012, as the inventory was sold, cost of goods sold included $0.4 million of non-cash charges for this step-up.

Terra Power Systems, LLC

On September 26, 2012, the company acquired 100% of Terra Power Systems, LLC (“Terra Power”), a U.S. manufacturer of electromechanical components including power distribution modules and fuse holders for commercial vehicle products for $10.6 million. The acquisition allows the company to strengthen its position in the commercial vehicle products market by adding new products and new customers within its Automotive business unit segment. Terra Power is based in Bellingham, Washington.  The company funded the acquisition with available cash.

All Terra Power goodwill and other assets and liabilities were recorded in the Automotive business unit segment and reflected in the Americas geographical area. The goodwill resulting from this acquisition consists largely of the company’s expected future product sales and synergies from combining Terra Power’s products with the company’s existing commercial vehicle product offerings. Goodwill for the above acquisition is expected to be deductible for tax purposes.
 
 
6

 
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3. Acquisition of Businesses, continued

The following table sets forth the preliminary purchase price allocation for Terra Power acquisition-date net assets, in accordance with the purchase method of accounting with adjustments to record the acquired net assets at their estimated fair values. The preliminary purchase price allocation reflected below is based on internal estimates and is expected to be finalized in the second quarter of 2013 although further adjustments are not anticipated to be significant.
 
Terra Power preliminary purchase price allocation (in thousands):
 
Cash
  $ 105  
Current assets, net
    1,625  
Property, plant and equipment
    457  
Goodwill
    4,562  
Other intangibles
    4,064  
Current liabilities
    (213 )
    $ 10,600  
 
Pro forma financial information is not presented for the company’s business acquisitions described above due to amounts not being materially different than actual results.

4. Inventories

The components of inventories at March 30, 2013 and December 29, 2012 are as follows (in thousands):

   
March 30, 2013
   
December 29, 2012
 
Raw material
  $ 21,819     $ 21,689  
Work in process
    12,062       11,868  
Finished goods
    37,491       42,023  
Total inventories
  $ 71,372     $ 75,580  

5. Other Investments

The company’s other investments represent shares of Polytronics Technology Corporation Ltd. (“Polytronics”), a Taiwanese company. The Polytronics investment was acquired as part of the Heinrich Companies acquisition in 2004.  The fair value of the Polytronics investment was €9.1million (approximately $11.6 million) at March 30, 2013 and €7.8 million (approximately $10.3 million) at December 29, 2012. Included in 2013 other comprehensive income is an unrealized gain of $1.6 million, due to the increase in fair market value of the Polytronics investment. The remaining movement was due to the impact of changes in exchange rates.

6. Impairment of Investment in Unconsolidated Affiliate

During the first quarter of 2013, the company fully impaired its investment in and loan receivable from Shocking owing to their filing for Chapter 7 bankruptcy on March 12, 2013.  The impairment charge of approximately $10.7 million consisted of the remaining equity method investment of $8.7 million and a $2.0 million loan receivable, and reduces the carrying value of both the investment and loan receivable to zero at March 30, 2013.

The loss was recorded as a component of impairment and equity loss of unconsolidated affiliate in the Consolidated Statements of Net Income for the three months ended March 30, 2013.

 
7

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

7. Debt

The carrying amounts of debt at March 30, 2013 and December 29, 2012 are as follows (in thousands):

   
March 30, 2013
   
December 29, 2012
 
             
Revolving credit facility
  $ 94,000     $ 84,000  

On June 13, 2011, the company entered into a new credit agreement with certain commercial banks that provides an unsecured revolving credit facility in an amount of up to $150.0 million, with a potential to increase up to $225.0 million. At March 30, 2013, the company had available $55.4 million of borrowing capacity under the revolving credit agreement at an interest rate of LIBOR plus 1.250% (1.45% as of March 30, 2013).

The credit agreement replaces the company’s previous credit agreement dated July 21, 2006 and loan agreement dated September 29, 2008, and, unless terminated earlier, will terminate on June 13, 2016.

8. Fair Value of Assets and Liabilities

In determining fair value, the company uses various valuation approaches within the fair value measurement framework.  Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability.

Applicable accounting literature establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.  Applicable accounting literature defines levels within the hierarchy based on the reliability of inputs as follows:

Level  1—Valuations based on unadjusted quoted prices for identical assets or liabilities in active markets;
Level  2—Valuations based on quoted prices for similar assets or liabilities or identical assets or liabilities in less active markets, such as dealer or broker markets; and
Level  3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable, such as pricing models, discounted cash flow models and similar techniques not based on market, exchange, dealer or broker-traded transactions.

Following is a description of the valuation methodologies used for instruments measured at fair value and their classification in the valuation hierarchy.

Investment in Polytronics

The company holds an investment in the equity securities of Polytronics as described in Note 5.  Equity securities listed on a national market or exchange are valued at the last sales price. Such securities are classified within Level 1 of the valuation hierarchy.

Investment in Shocking Technologies, Inc.

The company holds an investment in an unconsolidated affiliate, Shocking Technologies, Inc. (“Shocking”), as described in Note 6, for which the valuation model that was used to determine the fair value of Shocking at December 29, 2012, was a discounted cash flow model to value Shocking’s equity and then an option pricing method to allocate the equity value to the various classes of stock in Shocking’s capital structure, including Series C and common shares held by the company. Significant unobservable inputs used included an expected two years until liquidity event, a volatility of 35% and a risk free rate of 0.44%. The investment was categorized as Level 3.
 
 
8

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

8. Fair Value of Financial Assets and Liabilities, continued

There were no changes during the quarter ended March 30, 2013 to the company’s valuation techniques used to measure asset and liability fair values on a recurring basis. As of March 30, 2013 and December 29, 2012 the company held no 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, 2013 (in thousands):

   
Fair Value Measurements Using
       
   
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
   
Significant
Other
Observable
Inputs
(Level 2)
   
Significant
Unobservable
Inputs
(Level 3)
   
Total
 
                         
Investment in Polytronics
  $ 11,572     $     $     $ 11,572  
Total
  $ 11,572     $     $     $ 11,572  

The following table presents assets measured at fair value by classification within the fair value hierarchy as of December 29, 2012 (in thousands):

   
Fair Value Measurements Using
       
   
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
   
Significant
Other
Observable
Inputs
(Level 2)
   
Significant
Unobservable
Inputs
(Level 3)
   
Total
 
                         
Investment in Polytronics
  $ 10,327     $     $     $ 10,327  
Investment in unconsolidated affiliate
                8,666       8,666  
Total
  $ 10,327     $     $ 8,666     $ 18,993  

The company’s other financial instruments include cash and cash equivalents, short-term investments, accounts receivable, accounts payable and debt. The carrying amounts of cash and cash equivalents, short-term investments, accounts receivable, accounts payable and debt approximate their fair values. The company’s debt fair value approximates book value at March 30, 2013 and December 29, 2012, respectively, as the variable interest rates fluctuate along with market interest rates.

9. Earnings Per Share

The company computes earnings per share using the two-class method. The two-class method includes an earnings allocation formula that determines earnings per share for each class of common stock according to dividends declared and undistributed earnings for the period. The company’s reported net earnings is reduced by the amount allocated to participating securities to arrive at the earnings allocated to common stock shareholders for purposes of calculating earnings per share.

The dilutive effect of participating securities is calculated using the more dilutive of the treasury stock or the two-class method. The company has determined the two-class method to be the more dilutive. As such, the earnings allocated to common stock shareholders in the basic earnings per share calculation is adjusted for the reallocation of undistributed earnings to participating securities to arrive at the earnings allocated to common stock shareholders for calculating the diluted earnings per share.
 
 
9

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

9. Earnings Per Share, continued
 
The following table sets forth the computation of basic and diluted earnings per share under the two-class method.

   
For the Three Months Ended
 
(in thousands except per share amounts)
 
March 30, 2013
   
March 31, 2012
 
             
Net income as reported
  $ 14,794     $ 17,563  
Less: Distributed earnings available to participating securities
    (9 )     (6 )
Less: Undistributed earnings available to participating securities
    (10 )     (43 )
Numerator for basic earnings per share —
               
Undistributed and distributed earnings available to common shareholders
  $ 14,775     $ 17,514  
Add: Undistributed earnings allocated to participating securities
    10       44  
Less: Undistributed earnings reallocated to participating securities
    (10 )     (44 )
Numerator for diluted earnings per share —
               
Undistributed and distributed earnings available to common shareholders
  $ 14,775     $ 17,514  
Denominator for basic earnings per share —
               
Weighted-average shares
    22,095       21,608  
Effect of dilutive securities:
               
Common stock equivalents
    271       321  
Denominator for diluted earnings per share —
               
Adjusted for weighted-average shares & assumed conversions
    22,366       21,929  
Basic earnings per share
  $ 0.67     $ 0.81  
Diluted earnings per share
  $ 0.66     $ 0.80  

10. Restructuring

During the period 2006 through 2009, the company announced closures of its facilities in Dundalk, Ireland, Irving, Texas, Des Plaines, Illinois, Elk Grove, Illinois, Matamoros, Mexico, Swindon, U.K., Dünsen, Germany, Utrecht, Netherlands, and Yangmei, Taiwan. These manufacturing and distribution center closures were part of a multi-year plan to improve the company’s cost structure and margins by rationalizing the company’s footprint, reducing labor costs and moving closer to customers. As of March 30, 2013, all of these facility closures have been completed. Together, these initiatives have impacted approximately 946 employees and resulted in aggregate restructuring charges of $53.9 million through March 30, 2013. The company does not expect to incur any additional costs associated with these facility closures and related restructuring activities.

A summary of activity of this liability at December 29, 2012, and for the three months ended March 30, 2013 is as follows:

Littelfuse restructuring (in thousands)
Balance at December 29, 2012
    645  
Additions
    13  
Payments
    (129 )
Exchange rate impact
    (6 )
Balance at March 30, 2013
  $ 523  

Additional costs recorded that are not related to the initial restructuring plans discussed above were $0.1 million and $0.5 million for the quarter ended March 30, 2013 and year ended December 29, 2012, respectively

 
10

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

11. Income Taxes

The effective tax rate for the first quarter of 2013 was 17.7% compared to an effective tax rate of 29.3% in the first quarter of 2012.  The effective tax rates for both the first quarter of 2013 and 2012 are lower than the U.S. statutory tax rate primarily due to the result of more income earned in low tax jurisdictions.

12. Pensions

The components of net periodic benefit cost for the three months ended March 30, 2013, compared with the three months ended March 31, 2012, were (in thousands):

   
U.S. Plans
   
Foreign Plans
 
   
Three Months Ended
   
Three Months Ended
 
   
March 30, 2013
   
March 31, 2012
   
March 30, 2013
   
March 31, 2012
 
Service cost
  $ 150     $ 150     $ 255     $ 192  
Interest cost
    891       1,240       183       195  
Expected return on plan assets
    (1,340 )     (1,655 )     (74 )     (121 )
Amortization of net loss
    236       85       39       17  
Total cost of the plan
    (63 )     (180 )     403       283  
Expected plan participants’ contribution
                       
Net periodic benefit cost
  $ (63 )   $ (180 )   $ 403     $ 283  

The expected rate of return assumption on domestic pension assets is 6.75% and 7.75% in 2013 and 2012, respectively. The expected return on foreign pension assets is 3.00% and 4.53% in 2013 and 2012, respectively.

13. Business Unit Segment Information

The company and its subsidiaries design, manufacture and sell circuit protection devices throughout the world. The company reports its operations by the following business unit segments: Electronics, Automotive, and Electrical. Each operating segment is directly responsible for sales, marketing and research and development. Manufacturing, purchasing, logistics, customer service, finance, information technology and human resources are shared functions that are allocated back to the three operating segments. The CEO allocates resources to and assesses the performance of each operating segment using information about its revenue and operating income (loss) before interest and taxes, but does not evaluate the operating segments using discrete balance sheet information.

Sales, marketing and research and development expenses are charged directly into each operating segment. All other functions are shared by the operating segments and expenses for these shared functions are allocated to the operating segments and included in the operating results reported below. The company does not report inter-segment revenue because the operating segments do not record it. The company does not allocate interest and other income, interest expense, or taxes to operating segments. Although the CEO uses operating income (loss) to evaluate the segments, operating costs included in one segment may benefit other segments. Except as discussed above, the accounting policies for segment reporting are the same as for the company as a whole.

An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, and about which separate financial information is regularly evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. The CODM is the company’s President and Chief Executive Officer (“CEO”).

 
11

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

13. Business Unit Segment Information, continued

Business unit segment information for the three months ended March 30, 2013 and March 31, 2012 are summarized as follows (in thousands):

   
March 30, 2013
   
March 31, 2012
 
Net sales
           
Electronics
  $ 79,415     $ 77,055  
Automotive
    59,385       52,626  
Electrical
    32,118       30,897  
Total net sales
  $ 170,918     $ 160,578  
                 
Depreciation and amortization
               
Electronics
  $ 4,861     $ 5,486  
Automotive
    1,984       1,449  
Electrical
    959       1,014  
Total depreciation and amortization
  $ 7,804     $ 7,949  
                 
Operating income
               
Electronics
  $ 12,143     $ 10,112  
Automotive
    9,483       9,505  
Electrical
    6,491       6,207  
Total operating income
    28,117       25,824  
Interest expense
    376       423  
Impairment, loan loss and equity in net loss of unconsolidated affiliate (1)
    10,678       525  
Other (income) expense, net
    (909 )     101  
Income before income taxes
  $ 17,972     $ 24,775  


(1) During the first quarter of 2013, the company recorded approximately $10.7 million related to the impairment of its investment in Shocking Technologies. (See note 6). 2012 Income before income taxes has been restated to reflect the company’s retroactive equity losses from Shocking Technologies. (See note 2).

The company’s significant net sales by country for the three months ended March 30, 2013 and March 31, 2012 are summarized as follows (in thousands):

   
Net sales(a)
 
   
March 30, 2013
   
March 31, 2012
 
             
United States
  $ 57,914     $ 55,253  
China
    33,614       30,444  
Other countries
    79,390       74,881  
Total
  $ 170,918     $ 160,578  
(a) Sales by country represent sales to customer or distributor locations.

The company’s significant long-lived assets by country as of March 30, 2013 and December 29, 2012 are summarized as follows (in thousands):

   
Long-lived assets(b)
 
   
March 30, 2013
   
December 29, 2012
 
             
United States
  $ 13,963     $ 14,433  
China
    40,157       41,504  
Canada
    13,907       13,839  
Other countries
    52,273       51,135  
Total
  $ 120,300     $ 120,911  
(b) Long-lived assets consists of net property, plant and equipment.
 
 
12

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

14. Accumulated Other Comprehensive Income (Loss) (AOCI)

In February, 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) 2013-02 which requires companies to report, in one place, information about reclassifications out of accumulated other comprehensive income (AOCI). The new guidance allows companies to present this information on the face of the financial statements, if certain requirements are met. Otherwise, the information must be presented in the notes. If a company is unable to identify the line item of net income affected by any significant amount reclassified out of AOCI during a reporting period (including when all reclassifications for the period are not to net income in their entirety), the information must be reported in the notes. In addition, ASU 2013-02 requires detailed reporting about changes in AOCI balances. It requires companies to present details of current-period changes in AOCI for each component of other comprehensive income on the face of the financial statements or in the notes. The company adopted the new guidance on December 30, 2012 and will be applied prospectively. There was no impact on its consolidated financial statements upon adoption.

The following table sets forth the changes in the components of AOCI by component (in thousands):
AOCI component
 
Balance at
December 29, 2012
   
Other
comprehensive
income (loss)
activity
   
Balance at
March 30, 2013
 
                   
Pension liability adjustment(a)
  $ (20,879 )   $ (194 )   $ (21,073 )
Unrealized gain on investments(b)
    7,867       1,618       9,485  
Foreign currency translation adjustment
    29,560       (5,250 )     24,310  
Total
  $ 16,548             $ 12,722  

(a)  Balances are net of tax of $11,929 and $11,819 for 2013 and 2012, respectively.
(b)  Balances are net of tax of $0 and $0 for 2013 and 2012, respectively.

15. Subsequent Event

On April 15, 2013, the company announced it had signed a definitive agreement to acquire Hamlin, Inc. from Key Safety Systems for $145.0 million in a cash transaction. Hamlin is dedicated to providing sensor technology to the automotive industry as well as the electronics and industrial markets. The company expects to complete the transaction by the end of May 2013.

 
13

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Littelfuse, Inc. and its subsidiaries (the “company”) design, manufacture, and sell circuit protection devices for use in the electronics, automotive and electrical markets throughout the world. The following table is a summary of the company’s net sales by business unit and geography:

Net Sales by Business Unit and Geography (in millions, unaudited)

   
First Quarter
 
   
2013
   
2012
   
% Change
 
Business Unit
                 
Electronics
  $ 79.4     $ 77.1       3 %
Automotive
    59.4       52.6       13 %
Electrical
    32.1       30.9       4 %
                         
Total
  $ 170.9     $ 160.6       6 %
 
   
First Quarter
 
   
2013
   
2012
   
% Change
 
Geography(a)
                 
Americas
  $ 77.8     $ 74.0       5 %
Europe
    30.5       27.8       10 %
Asia-Pacific
    62.6       58.8       6 %
                         
Total
  $ 170.9     $ 160.6       6 %
 
(a) Sales by geography represent sales to customer or distributor locations.

Results of Operations – First Quarter, 2013 compared to 2012

Net sales increased $10.3 million or 6% to $170.9 million in the first quarter of 2013 compared to $160.6 million in the first quarter of 2012 due primarily to an incremental $7.5 million from business acquisitions and broad-based growth in all businesses and geographies. The company also experienced $0.2 million in unfavorable foreign currency effects in the first quarter of 2013 as compared to the first quarter of 2012. The unfavorable foreign currency impact primarily resulted from sales denominated in the Japanese yen and Canadian dollar, offset by the favorable impact of the euro. Excluding incremental sales from acquisitions and currency effects, net sales increased $3.0 million or 2% year-over-year.

Electronics sales increased $2.3 million or 3% to $79.4 million in the first quarter of 2013 compared to $77.1 million in the first quarter of 2012 due to low channel inventories and improving market sentiment. The electronics segment experienced $0.2 million in unfavorable currency effects in the first quarter of 2013 primarily from sales denominated in Japanese yen.

Automotive sales increased $6.8 million or 13% to $59.4 million in the first quarter of 2013 compared to $52.6 million in the first quarter of 2012 due to an incremental $7.5 million from business acquisitions and growth in the passenger vehicle business. This was partially offset by a decline in the commercial vehicle business which, while showing signs of recovery, still declined 10% as compared to the first quarter of 2012. The automotive segment experienced $0.2 million in favorable currency effects in the first quarter of 2013 primarily due to sales denominated in euros. Excluding incremental sales from acquisitions and currency effects, net sales decreased $0.9 million or 2% year-over-year.

Electrical sales increased $1.2 million or 4% to $32.1 million in the first quarter of 2013 compared to $30.9 million in the first quarter of 2012 due to growth in power fuses primarily reflecting increased sales into the solar market.   The electrical segment experienced $0.2 million in unfavorable currency effects in the first quarter of 2013 primarily from sales denominated in Canadian dollars.
 
 
14

 

On a geographic basis, sales in the Americas increased $3.8 million or 5% to $77.8 million in the first quarter of 2013 compared to $74.0 million in the first quarter of 2012 due to increased sales of power fuses offset by weaker commercial vehicle product sales and $0.2 million in unfavorable currency effects from sales denominated in Canadian dollars.

Europe sales increased $2.7 million or 10% to $30.5 million in the first quarter of 2013 compared to $27.8 million in the first quarter of 2012 mainly due to incremental sales of $5.7 million from Accel and $0.2 million in favorable currency effects offset by lower demand for electronics and automotive products.  Excluding incremental sales and currency effects, Europe sales declined 11% year-over-year primarily due to a decrease in demand for automotive and electrical products partially offset by an increase in sales of electronics products.

Asia-Pacific sales increased $3.8 million or 6% to $62.6 million in the first quarter of 2013 compared to $58.8 million in the first quarter of 2012 primarily due to higher demand for electrical and automotive products offset by $0.2 million in unfavorable currency effects primarily from sales denominated in Japanese yen.

Gross profit was $64.6 million or 38% of net sales for the first quarter of 2013 compared to $60.9 million or 38% of net sales in the same quarter last year.

Total operating expense was $36.5 million or 21% of net sales for the first quarter of 2013 compared to $35.0 million or 22% of net sales for the same quarter in 2012. The increase in operating expenses primarily reflects incremental operating expenses of $1.5 million from the business acquisitions.

Operating income for the first quarter of 2013 was approximately $28.1 million compared to operating income of $25.8 million for the same quarter in 2012 primarily due to higher sales and gross margin partially offset by slightly higher operating expenses as described above.

Interest expense was $0.4 million in both the first quarter of 2013 and the first quarter of 2012.

Impairment, loan loss and equity losses from the investment in and loan to Shocking Technologies was $10.7 million in the first quarter of 2013 compared to $0.5 million in the first quarter of 2012. The company fully impaired its investment and loan receivable in Shocking during the first quarter of 2013 as described in Note 6.

Other (income) expense, net, consisting of interest income, royalties, non-operating income and foreign currency items was approximately $0.9 million of income for the first quarter of 2013 compared to $0.1 million of expense in the first quarter of 2012. The results for 2013 and 2012 were primarily due to the impact from foreign exchange revaluation.

Income before income taxes was $18.0 million for the first quarter of 2013 compared to income before income taxes of $24.8 million for the first quarter of 2012. Income tax expense was $3.2 million with an effective tax rate of 17.7% for the first quarter of 2013 compared to income tax expense of $7.2 million with an effective tax rate of 29.1% in the first quarter of 2012. The effective tax rates for both the first quarter of 2013 and 2012 are lower than the U.S. statutory tax rate primarily due to the result of more income earned in low tax jurisdictions.

Net income for the first quarter of 2013 was $14.8 million or $0.66 per diluted share compared to net income of $17.6 million or $0.80 per diluted share for the same quarter of 2012.

Liquidity and Capital Resources

As of March 30, 2013, $231.8 million of the $246.9 million of the company’s cash and cash equivalents was held by foreign subsidiaries. Of the $231.8 million held by foreign subsidiaries, approximately $20.5 million could be repatriated with minimal tax consequences. The company expects to maintain its foreign cash balances (other than the aforementioned $20.5 million) for local operating requirements, to provide funds for future capital expenditures and for potential acquisitions. The company does not expect to repatriate these funds to the U.S.

The company historically has financed capital expenditures through cash flows from operations. Management expects that cash flows from operations and available lines of credit will be sufficient to support both the company’s operations and its debt obligations for the foreseeable future.
 
 
15

 
 
Revolving Credit Facilities

On June 13, 2011 the company entered into a domestic unsecured financing agreement, which expires on June 13, 2016, consisting of a credit agreement with certain commercial banks that provides a $150.0 million revolving credit facility, with a potential to increase up to $225.0 million upon request of the company and agreement with the lenders.  At March 30, 2013, the company had available $55.4 million of borrowing capacity under the revolving credit facility at an interest rate of LIBOR plus 1.250% (1.45% as of March 30, 2013).  The credit agreement replaced the company’s previous credit agreement dated July 21, 2006 and term loan agreement dated September 29, 2008, and, unless terminated earlier, will terminate on June 13, 2016. This arrangement contains covenants that, among other matters, impose limitations on the incurrence of additional indebtedness, future mergers, sales of assets, payment of dividends, and changes in control, as defined in the agreement. In addition, the company is required to satisfy certain financial covenants and tests relating to, among other matters, interest coverage and leverage. At March 30, 2013, the company was in compliance with all covenants under the revolving credit facility.

The company also had $0.8 million outstanding in letters of credit at March 30, 2013.  No amounts were drawn under these letters of credit at March 30, 2013.

Cash Flow

The company started 2013 with $235.4 million of cash and cash equivalents. Net cash provided by operating activities was approximately $16.0 million for the first three months of 2013 reflecting $14.8 million in net income and $19.8 million in non-cash adjustments (primarily $10.7 million in impairment charges and $7.8 million in depreciation and amortization) offset by $18.5 million in net changes to various operating assets and liabilities.

Changes in operating assets and liabilities for the first three months of 2013 (including short-term and long-term items) that impacted cash flows negatively consisted of increases in accounts receivables ($9.7 million) and decreases in accrued payroll and severance ($7.3 million), accrued expenses (including post-retirement) ($4.6 million) and accrued taxes ($3.9 million). The increase in accounts receivables was due to increased sales in the first quarter. The decrease in accrued payroll and severance was due primarily to payouts for the 2012 management incentive plan which occurred in the first quarter. The decrease in accrued expenses was due primarily to a $5.0 million pension contribution made during the first quarter. Changes that had a positive impact on cash flows were decreases in inventories ($3.6 million) and prepaid expenses and other ($1.0 million) and increases in accounts payable ($2.4 million).

Net cash used in investing activities was approximately $13.9 million and included $5.4 million in capital spending, and $8.5 million in expenditures for short-term investments.

Net cash provided by financing activities was approximately $11.3 million and included $10.0 million in net proceeds from borrowing and $5.8 million from the exercise of stock options, including tax benefits, partially offset by cash dividends paid of $4.4 million. The effects of exchange rate changes decreased cash and cash equivalents by approximately $2.0 million. The net cash provided by operating activities combined with the effects of exchange rate changes less net cash used in investing and financing activities resulted in a $11.5 million increase in cash, which left the company with a cash and cash equivalents balance of $246.9 million at March 30, 2013.

The ratio of current assets to current liabilities was 3.0 at the end of the first quarter of 2013 compared to 2.9 at year-end 2012 and 2.5 at the end of the first quarter of 2012. Days sales outstanding in accounts receivable was approximately 57 days at the end of the first quarter of 2013 compared to 61 days at the end of the first quarter of 2012 and 58 days at year-end 2012. Days inventory outstanding was approximately 61 days at the end of the first quarter of 2013 compared to 69 days at the year-end 2012 and 71 days at end of the first quarter of 2012.

Outlook

The company’s sales and order rates have rebounded during the first quarter. The electronics business is showing signs of improvement while the electrical and automotive passenger vehicle markets continue to grow modestly. The commercial vehicle  business appears to be recovering but still faces headwinds in key end markets. Protection relays and custom products have been negatively impacted by the slowdown in mining and are expected to show further weakness in the second half of 2013 as several large projects near completion. Sales for the second quarter of 2013 are expected to increase between 4% and 9% compared to the first quarter of 2013.
 
 
16

 

Cautionary Statement Regarding Forward-Looking Statements Under the Private Securities Litigation Reform Act of 1995 (“PSLRA”).

The statements in this section and the other sections of this report that are not historical facts are intended to constitute “forward-looking statements” entitled to the safe-harbor provisions of the PSLRA. These statements may involve risks and uncertainties, including, but not limited to, risks relating to product demand and market acceptance, economic conditions, the impact of competitive products and pricing, product quality problems or product recalls, capacity and supply difficulties or constraints, coal mining exposures reserves, failure of an indemnification for environmental liability, exchange rate fluctuations, commodity price fluctuations, the effect of the company’s accounting policies, labor disputes, restructuring costs in excess of expectations, pension plan asset returns less than assumed, integration of acquisitions and other risks which may be detailed in the company’s other 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, 2012. For a further discussion of the risk factors of the company, please see Item 1A. “Risk Factors” to the company’s Annual Report on Form 10-K for the year ended December 29, 2012.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

The company is exposed to market risk from changes in interest rates, foreign exchange rates and commodity prices.

Interest Rates
 
The company had $94.0 million in debt outstanding under revolving credit facilities at March 30, 2013, at variable rates. While 100% of this debt has variable interest rates, the company’s interest expense is not materially sensitive to changes in interest rate levels since debt levels and potential interest expense increases are small relative to earnings.

Foreign Exchange Rates
 
The majority of the company’s operations consist of manufacturing and sales activities in foreign countries. The company has manufacturing facilities in the U.S., Mexico, Canada, Denmark, China, Lithuania and the Philippines. During the first three months of 2013, sales to customers outside the U.S. were 66.1% of total net sales. Substantially all sales in Europe are denominated in euros and substantially all sales in the Asia-Pacific region are denominated in U.S. dollars, Japanese yen, Korean won, Chinese yuan or Taiwanese dollars.

The company’s foreign exchange exposures result primarily from sale of products in foreign currencies, foreign currency denominated purchases, employee-related and other costs of running operations in foreign countries and translation of balance sheet accounts denominated in foreign currencies. The company’s most significant long exposure is to the euro, with lesser long exposures to the Canadian dollar, Japanese yen and Korean won. The company’s most significant short exposures are to the Chinese yuan, Mexican peso and Philippine peso. Changes in foreign exchange rates could affect the company’s sales, costs, balance sheet values and earnings. The company uses netting and offsetting intercompany account management techniques to reduce known foreign currency exposures where possible. From time to time, the company has utilized derivative instruments to hedge certain foreign currency exposures deemed to be material.

Commodity Prices

The company uses various metals in the manufacturing of its products, including copper, zinc, tin, gold and silver. Prices of these commodities can and do fluctuate significantly, which can impact the company’s earnings. The most significant of these exposures is to copper, zinc, gold, and silver where at current prices and volumes, a 10% price change would affect annual pre-tax profit by approximately $2.2 million for copper, $0.7 million for zinc, $0.4 million for gold, and $0.8 million for silver. From time to time, the company has utilized derivative instruments to hedge certain commodity exposures deemed to be material.
 
 
17

 
 
Item 4. Controls and Procedures.

As of March 30, 2013, the Chief Executive Officer and Chief Financial Officer of the company evaluated the effectiveness of the disclosure controls and procedures of the company and concluded that these disclosure controls and procedures are effective to ensure that material information relating to the company and its consolidated subsidiaries has been made known to them by the employees of the company and its consolidated subsidiaries during the period preceding the filing of this Quarterly Report on Form 10-Q and that such information is accurately recorded, processed, summarized and reported within the time periods specified in SEC rules. There were no significant changes in the company’s internal controls during the period covered by this Report that could materially affect these controls or could reasonably be expected to materially affect the company’s internal control reporting, disclosures and procedures subsequent to the last day they were evaluated by the company’s Chief Executive Officer and Chief Financial Officer.
 
 
18

 
 
PART II - OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors.

A detailed description of risks that could have a negative impact on our business, revenues and performance results can be found under the caption “Risk Factors” in our most recent Form 10-K, filed with the SEC on February 27, 2013.  There have been no material changes from risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 29, 2012 in response to Item 1A to Part 1 of Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. - open

The company’s Board of Directors authorized the repurchase of up to 1,000,000 shares of the company’s common stock under a program for the period May 1, 2013 to April 30, 2014. The company did not repurchase any shares of its common stock during the first quarter of fiscal 2013 and 1,000,000 shares may yet be purchased under the previous authorization as of March 30, 2013.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.
 
 
19

 

Item 6. Exhibits.

 
Exhibit
Description

 
31.1
Certification of Gordon Hunter, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
 
 
31.2
Certification of Philip G. Franklin, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
 
 
32.1
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 
101.INS
XBRL Instance Document
 
 
101.SCH
XBRL Taxonomy Extension Schema Document
 
 
101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document
 
 
101.DEF
XBRL Taxonomy Definition Linkbase Document
 
 
101.LAB
XBRL Taxonomy Extension Label Linkbase Document
 
 
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document
 
 
20

 
 
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, 2013, to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
Littelfuse, Inc.
 
       
Date: May 3, 2013  
By
/s/ Philip G. Franklin   
   
Philip G. Franklin
 
   
Vice President, Operations Support, and
 
   
Chief Financial Officer
 
   
(As duly authorized officer and as
 
   
the principal financial and accounting
 
   
officer)
 
       

 
21
ex31-1.htm
EXHIBIT 31.1
 
SECTION 302 CERTIFICATION
 
I, Gordon Hunter, certify that:
 
 
1.
I have reviewed this quarterly report on Form 10-Q of Littelfuse Inc.;
 
 
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
 
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
 
4.
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
 
5.
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 

 
Dated: May 3, 2013

/s/ GORDON HUNTER                                        
Gordon Hunter
Chairman, President and
Chief Executive Officer
ex31-2.htm
EXHIBIT 31.2
 
SECTION 302 CERTIFICATION
 
I, Philip G. Franklin, certify that:
 
 
1.
I have reviewed this quarterly report on Form 10-Q of Littelfuse Inc.;
 
 
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
 
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
 
4.
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:
 
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
 
5.
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 

 
Dated: May 3, 2013

/s/ PHILIP G. FRANKLIN                                             
Philip G. Franklin
Vice President, Operations Support, and
Chief Financial Officer

ex32-1.htm
EXHIBIT 32.1
 
LITTELFUSE, INC.
 
 
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350

 
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of title 18, United States Code), each of the undersigned officers of Littelfuse, Inc. (“the Company”) does hereby certify that to his knowledge:

 
The Quarterly Report of the Company on Form 10-Q for the fiscal quarter ended March 30, 2013 (“the Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 
 
 
/s/ GORDON HUNTER
   
/s/ PHILIP G. FRANKLIN 
 
 
Gordon Hunter
   
Philip G. Franklin
 
 
Chairman, President and
   
Vice President, Operations Support, and
 
  Chief Executive Officer       Chief Financial Officer  
           
  Dated: May 3, 2013     Dated: May 3, 2013