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Business Segment, Geographic and Concentration Risk Information
 3 Months Ended
Mar. 29, 2013
Business Segment, Geographic and Concentration Risk Information [Abstract]  
BUSINESS SEGMENT, GEOGRAPHIC AND CONCENTRATION RISK INFORMATION

15. BUSINESS SEGMENT, GEOGRAPHIC AND CONCENTRATION RISK INFORMATION

 

The Company operates its business in two reportable segments – Implantable Medical and Electrochem. The Implantable Medical segment is comprised of Greatbatch Medical and QiG Group and designs and manufactures medical devices and components for the cardiac, neuromodulation, vascular and orthopaedic markets. The Implantable Medical segment offers complete medical devices including design, development, manufacturing, regulatory submission and supporting worldwide distribution, which is facilitated through the QiG Group and leverages the component technology of Greatbatch Medical. The devices designed and developed by the QiG Group are manufactured by Greatbatch Medical. The Implantable Medical segment also offers individual components for implantable medical devices as well as value-added assembly and design engineering services for its component products. Examples of these components include batteries, capacitors, filtered and un-filtered feedthroughs, machined components, enclosures, leads, introducers, catheters, as well as orthopaedic implants, instruments and cases and trays.

 

Electrochem is an industry leader in designing and manufacturing total power solutions for critical applications with market-leading OEMs, largely in the portable medical and energy space. Electrochem offers its customers components, consultation, design, development and testing for medical device applications, in high-value markets, including those that support the transition of delivery of health care from clinical to outpatient and home settings, as well as those that enhance the quality of life for an aging population. Examples of these devices include powered surgical tools, automated external defibrillators, portable ultrasound devices, portable oxygen concentrators, and ventilators, among others. Electrochem provides cell and battery pack configurations for rechargeable and non-rechargeable battery power systems, charging and docking stations, and power supplies, for devices where failure is not an option.

 

The Company defines segment income from operations as sales less cost of sales including amortization and expenses attributable to segment-specific selling, general, administrative, research, development, engineering and other operating activities. Segment income also includes a portion of non-segment specific selling, general, and administrative expenses based on allocations appropriate to the expense categories. The remaining unallocated operating and other expenses are primarily administrative corporate headquarters' expenses and capital costs that are not allocated to reportable segments. Transactions between the two segments are not significant.

 

An analysis and reconciliation of the Company's business segment, product line and geographic information to the respective information in the Condensed Consolidated Financial Statements follows. Sales by geographic area are presented by allocating sales from external customers based on the location to which products are shipped (in thousands):

    Three Months Ended 
    March 29, March 30, 
 Sales:2013 2012 
 Implantable Medical      
  Cardiac/Neuromodulation$ 71,167 $ 75,135 
  Vascular   10,624   11,636 
  Orthopaedic  29,623   31,046 
   Total Implantable Medical  111,414   117,817 
 Electrochem      
  Portable Medical  18,889   18,720 
  Energy  12,293   14,771 
  Other  5,669   7,795 
   Total Electrochem  36,851   41,286 
   Total sales$ 148,265 $ 159,103 

    Three Months Ended 
    March 29, March 30, 
  2013 2012 
 Segment income from operations:      
  Implantable Medical$ 14,343 $ 10,112 
  Electrochem  4,816   4,471 
 Total segment income from operations  19,159   14,583 
 Unallocated operating expenses (4,820)  (3,385) 
 Operating income as reported  14,339   11,198 
 Unallocated other expense (7,273)  (5,079) 
 Income before provision for income taxes$ 7,066 $ 6,119 

    Three Months Ended 
    March 29, March 30, 
  2013 2012 
 Sales by geographic area:
  United States$ 71,334 $ 82,406 
 Non-Domestic locations:      
  Puerto Rico  28,498   23,540 
  Belgium  17,671   15,338 
  United Kingdom & Ireland  7,536   12,357 
  Rest of world  23,226   25,462 
   Total sales$ 148,265 $ 159,103 

 Three customers accounted for a significant portion of the Company’s sales as follows:
          
    Three Months Ended 
    March 29, March 30, 
  2013 2012 
 Customer A 19%  20% 
 Customer B 18%  13% 
 Customer C 15%  10% 
  Total 52%  43% 

 Long-lived tangible assets by geographic area are as follows (in thousands):
  As of
   March 29,  December 28,
   2013  2012
 United States$ 121,460 $ 123,104
 Rest of world  29,072   27,789
 Total$ 150,532 $ 150,893