Facts & Figures: 10 Years of Connector Industry Income Statements

By Dave Pheteplace | May 04, 2015

The connector industry is one of the most profitable subsections of the electronic components industry. Bishop & Associates’ Dave Pheteplace looks at 10 years of connector industry income statements.

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.

COGS percent of sales 2004-2013

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.

SG&A Percent of Sales 2004-2013

The average SG&A was 15.5% of sales for 2004 through 2013. The average SG&A, excluding 2009 results, was 15.4% of sales. In 2013, the average SG&A was 16.1%.

The following chart provides the industry’s operating income (Op Income) as a percentage of sales for 2004 through 2013.

Operating income percent of sales 2004-2013

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.

Net income percent of sales 2004-2013

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.

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Dave Pheteplace

SVP and Managing Director Cable Assembly at Bishop & Associates Inc.

David Pheteplace joined Bishop & Associates Inc. in 2008, and was appointed vice president in September 2011. He is also the managing director of Bishop’s cable assembly division, which he established in 2008. Pheteplace has more than 30 years of experience in the interconnect industry, including managing divisions of Amphenol, Cinch, and Robinson Nugent.

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