Facts and Figures: 10 Years of Connector Industry Income Statement | TTI, Inc.

The connector industry grew to almost $53 billion in 2014. It is one of the most profitable subsections of the electronic component industries. Let’s take a look at some of the stats that demonstrate this.

The following chart provides the industry’s cost of goods sold (COGS) as a percentage of sales for 2004 through 2013.

The average COGS was 71.8% of sales for the 10-year period. The average COGS, excluding 2009 results, was 71.2% of sales. In 2013, the average COGS was 71.4%. In 2009, the industry was not able to reduce costs at the same rate that sales were declining, so COGS shot up to 77.5%.

The following chart provides the industry’s selling, general, and administrative (SG&A) expenses as a percentage of sales for 2004 through 2013.

The average operating income was 9.7% of sales. The average operating income, less the 2009 results, was 11.8%. The average operating income in 2013 was 11.3%.

The following chart provides the industry’s net income as a percentage of sales for 2004 through 2013.

The average net income was 6.0% of sales for the 10-year period. The average net income, excluding the results of 2009, was 7.9%. The average net income in 2013 was 8.6%. The low point in the last 10 years was 2009 at ¬ 12.6% of sales.

In the final analysis, connector companies are very profitable, highly sought-after acquisition targets and frequently sell for high EBITDA multiples.

Ronald E. Bishop


Ronald E. Bishop

Ronald E. Bishop founded Bishop & Associates Inc., a market research firm that specializes in the world electronic connector industry, in 1985. The firm publishes a monthly newsletter titled “The Bishop Report,” and the twice-monthly digital publication Connector Supplier.

The reports, produced by a staff of 20 researchers, focus on geographic regions, end-user equipment markets, connector products, and interconnect technologies.

The firm also provides executive placement services and conducts multi-client studies and customer surveys, and assists in merger and acquisition activity.  View other posts from Ronald E. Bishop.

 

Statements of fact and or opinions expressed in MarketEYE by its contributors are the responsibility of the authors alone and do not imply an opinion of the officers or the representatives of TTI, Inc.

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