SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)
ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
	For the Fiscal Year Ended December 31, 2002

or

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
	For the transition period from to

Commission file number 1-10879

AMPHENOL CORPORATION

(Exact name of Registrant as specified in its Charter)

Delaware		22-2785165
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

358 Hall Avenue, Wallingford, Connecticut 06492
203-265-8900
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Class A Common Stock, $.001 par value		New York Stock Exchange, Inc.
(Title of each Class)		(Name of each Exchange on which Registered)

Securities registered pursuant to Section 12(g) of the Act: None

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 ý No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

Indicate by check mark whether the registrant is an accelerated filer (as indicated in Rule 12b-2 of the Act).

Yes ý No o

The aggregate market value of Amphenol Corporation common stock, $.001 par value, held by non-affiliates was approximately $878 million based on the reported last sale price of such stock on the New York Stock Exchange on February 28, 2003.

As of February 28, 2003 the total number of shares outstanding of registrant’s common stock was 42,572,423.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant’s Definitive Proxy Statement which is expected to be filed within 120 days following the end of the fiscal year covered by this report, are incorporated by reference into Part III hereof.

INDEX

PART I
	Item 1.	Business
		General
		Business Segments
		International Operations
		Customers
		Manufacturing
		Research and Development
		Trademarks and Patents
		Competition
		Backlog
		Employees
		Other
		Cautionary Statements for Purposes of Forward Looking Information
	Item 2.	Properties
	Item 3.	Legal Proceedings
	Item 4.	Submission of Matters to a Vote of Security-Holders
	Item 4.1	Executive Officers

PART II
	Item 5.	Market for the Registrant’s Common Stock and Related Stockholder Matters
	Item 6.	Selected Financial Data
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 7A.	Quantitative and Qualitative Disclosures About Market Risk
	Item 8.	Financial Statements and Supplementary Data
		Report of Management
		Independent Auditors’ Report
		Consolidated Statement of Income
		Consolidated Balance Sheet
		Consolidated Statement of Changes in Shareholders’ Equity
		Consolidated Statement of Cash Flow
		Notes to Consolidated Financial Statements
	Item 9.	Changes in and Disagreements with Independent Accountants on Accounting and Financial Disclosure

PART III
	Item 10.	Directors and Executive Officers of the Registrant
	Item 11.	Executive Compensation
	Item 12.	Security Ownership of Certain Beneficial Owners and Management
	Item 13.	Certain Relationships and Related Transactions
	Item 14.	Controls and Procedures

PART IV
	Item 15.	Exhibits, Financial Statement Schedules and Reports on Form 8-K
		Signature of the Registrant
		Signatures of the Directors
		Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

PART I

Item 1. Business

General

Amphenol Corporation (“Amphenol” or the “Company”) is one of the world’s largest designers, manufacturers and marketers of electrical, electronic and fiber optic connectors, interconnect systems and coaxial and flat-ribbon cable. The primary end markets for the Company’s products are:

• communication systems for the converging technologies of voice, video and data communications;

• a broad range of industrial applications including factory automation and motion control systems, medical and industrial instrumentation, mass transportation and natural resource exploration, and automotive applications; and

• commercial and military aerospace applications.

The Company’s strategy is to provide its customers with comprehensive design capabilities, a broad selection of products and a high level of service on a worldwide basis while maintaining continuing programs of productivity improvement and cost control. For 2002, the Company reported net sales, operating income and net income of $1,062.0 million, $173.9 million and $80.3 million, respectively. The table below summarizes information regarding the Company’s primary markets and end applications for the Company’s products:

	Communications	Industrial/Automotive	Commercial and Military Aerospace

Percentage of Sales	52%	23%	25%

Primary End Applications	Voice • wireless handsets and personal communication devices • base stations and other wireless and telecommunications infrastructure	Factory automation Instrumentation and medical systems Automobile safety systems and other on board electronics Mass transportation Oil exploration Off-road construction	Military and Commercial Aircraft • avionics • engine controls • flight controls • passenger related systems Missile systems Battlefield communications Satellite and Space Station programs
	Video • cable television networks and set top converters
	Data • cable modems • servers and storage systems • computers, personal computers and related peripherals • data networking equipment

The Company designs and manufactures connectors and interconnect systems which are used primarily to conduct electrical and optical signals for a wide range of sophisticated electronic applications. The Company believes, based primarily on published market research, that it is one of the largest connector manufacturers in the world. The Company has developed a broad range of connector and interconnect products for communications equipment applications including the converging voice, video and data communications markets. The Company is also one of the leaders in developing interconnect products for factory automation, machine tools, instrumentation and medical systems, mass transportation applications and automotive applications, including airbags, pretensioner seatbelts and other on board automotive electronics. In addition, the Company is the leading supplier of high performance, military-specification, circular environmental connectors that require superior performance and reliability under conditions of stress and in hostile environments. These conditions are frequently encountered in commercial and military aerospace applications and other demanding industrial applications such as oil exploration, medical instrumentation and off-road construction.

Industry analysts estimate that the worldwide market for interconnect products will grow approximately 6% in 2003. The Company believes that the worldwide industry for interconnect products and systems is highly fragmented with over 2,000 producers of connectors worldwide, of which the 10 largest, including Amphenol, accounted for a combined market share of approximately 47% in 2002. Industry analysts estimate that the total sales for the industry were approximately $30 billion in 2002.

The Company’s Times Fiber subsidiary is the world’s second largest producer of coaxial cable for the cable television market. The Company believes that its Times Fiber unit is one of the lowest cost producers of coaxial cable for cable television, and that it is one of the technological leaders in increasing the bandwidth of coaxial cable products. The Company’s coaxial cable and connector products are used in cable television systems including full service cable television/telecommunication systems being installed by cable operators and telecommunication companies offering video, voice and data services. The Company is also a major supplier of coaxial cable to the developing international cable television market.

The Company is a global manufacturer employing advanced manufacturing processes. The Company manufactures and assembles its products at facilities in the Americas, Europe, Asia and Australia. The Company sells its connector products through its own global sales force and independent manufacturers’ representatives to thousands of OEMs in approximately 60 countries throughout the world as well as through a global network of electronics distributors. The Company sells its coaxial cable products primarily to cable television operators and to telecommunication companies who have entered the broadband communications market. For the year 2002, approximately 50% of the Company’s net sales were in North America, 26% were in Europe and 24% were in Asia and other countries.

The Company implements its product development strategy through product design teams and collaboration arrangements with customers which result in the Company obtaining approved vendor status for its customers’ new products and programs. The Company seeks to have its products become widely accepted within the industry for similar applications and products manufactured by other potential customers, which the Company believes will provide additional sources of future revenue. By developing application specific products, the Company has decreased its exposure to standard products which generally experience greater pricing pressure. In addition to product design teams and customer collaboration arrangements, the Company uses key account managers to manage customer relationships on a global basis such that it can bring to bear its total resources to meet the worldwide needs of its multinational customers. The Company is also focused on making strategic acquisitions in certain markets to further broaden and enhance its product offerings and expand its global capabilities.

Business Segments

The following table sets forth the dollar amounts of the Company’s net trade sales for its business segments. For a discussion of factors affecting changes in sales by business segment and additional segment financial data, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 7 in the Company’s “Notes to Consolidated Financial Statements.”

	2002		2001		2000
	(dollars in thousands )
Net trade sales by business segment:
Interconnect products and assemblies	$	892,309	$	906,799	$	1,009,162
Cable products	169,693		196,972		350,540
	$	1,062,002	$	1,103,771	$	1,359,702
Net trade sales by geographic area (1):
United States operations	$	501,073	$	538,938	$	714,756
International operations	560,929		564,833		644,946
	$	1,062,002	$	1,103,771	$	1,359,702

(1) Based on customer location to which product is shipped.

Interconnect Products and Assemblies. The Company produces a broad range of interconnect products and assemblies primarily for voice, video and data communication systems, commercial and military aerospace systems, automotive and mass transportation applications, and industrial and factory automation equipment. Interconnect products include connectors, which when attached to an electronic or fiber optic cable, a printed circuit board or other device, facilitate electronic or fiber optic transmission. Interconnect assemblies generally consist of a system of cable and connectors for linking electronic and fiber optic equipment. The Company designs and produces a broad range of connector and cable assembly products used in communication applications, such as: engineered cable assemblies used in base stations for wireless communication systems and internet networking equipment; smart card acceptor devices used in mobile GSM telephones, cable modems and other applications to facilitate reading data from smart cards; fiber optic couplers and connectors used in fiber optic signal transmission; input/output connectors and assemblies used for servers and data storage devices and linking personal computers and peripheral equipment; and sculptured flexible circuits used for integrating printed circuit boards in communication applications. The Company also designs and produces a broad range of radio frequency connector products used in telecommunications, computer and office equipment, instrumentation equipment and local area networks. The Company’s radio frequency interconnect products and assemblies are also used in base stations, mobile communication devices and other components of cellular and personal communications networks.

The Company believes that it is the largest supplier of high performance, military-specification, circular environmental connectors. Such connectors require superior performance and reliability under conditions of stress and in hostile environments. High performance environmental connectors are generally used to interconnect electronic and fiber optic systems in sophisticated aerospace, military, commercial and industrial equipment. These applications present demanding technological requirements in that the connectors can be

subject to rapid and severe temperature changes, vibration, humidity and nuclear radiation. Frequent applications of these connectors include aircraft, guided missiles, radar, military vehicles, equipment for spacecraft, energy, medical instrumentation, geophysical applications and off-road construction equipment. The Company also designs and produces industrial interconnect products used in a variety of applications such as factory automation equipment, mass transportation applications including railroads and marine transportation; and automotive safety products including interconnect devices and systems used in automotive airbags, pretensioner seatbelts, antilock braking systems and other on board automotive electronic systems. The Company also designs and produces highly-engineered cable and backplane assemblies. Such assemblies are specially designed by the Company in conjunction with OEM customers for specific applications, primarily for computer, wired and wireless communication systems, office equipment and aerospace applications. The cable assemblies utilize the Company’s connector and cable products as well as components purchased from others.

Cable Products. The Company designs, manufactures and markets coaxial cable primarily for use in the cable television industry. The Company manufactures two primary types of coaxial cable: semi-flexible, which has an aluminum tubular shield, and flexible, which has one or more braided metallic shields. Semi-flexible coaxial cable is used in the trunk and feeder distribution portion of cable television systems, and flexible cable (also known as drop cable) is used primarily for hookups from the feeder cable to the cable television subscriber’s residence. Flexible cable is also used in other communication applications. The Company has also developed a broad line of radio frequency connectors for coaxial cable and fiber optic interconnect components for full service cable television/telecommunication networks.

The rapid development in fiber optic technologies, digital compression (which allows several channels to be transmitted within the same bandwidth that a single analog channel currently requires) and other communication technologies, including the Company’s development of higher capacity coaxial cable, have resulted in technologies that enable cable television systems to provide channel capacity in excess of 500 channels. Such expanded channel capacity, along with other component additions, permit cable operators to offer full service networks with a variety of capabilities including near video-on-demand, pay-per-view special events, home shopping networks, interactive entertainment and education services, telephone services and high-speed access to data resources such as the Internet. With respect to expanded channel capacity systems, cable operators have generally adopted, and the Company believes that for the foreseeable future will continue to adopt, a cable system using both fiber optic cable and coaxial cable. Such systems combine the advantages of fiber optic cable in transmitting clear signals over a long distance without amplification, with the advantages of coaxial cable in ease of installation, low cost and compatibility with the receiving components of the customer’s communication devices. The Company believes that while system operators are likely to increase their use of fiber optic cable for the trunk and feeder portions of the cable systems, there will be an ongoing need for high capacity coaxial cable for the local distribution and street-to-the-home portions of the cable system. In addition, U.S. cable system designs are increasingly being employed in international markets where cable television penetration is generally lower than in the U.S. The Company believes the development of cable television systems in international markets presents a significant opportunity to increase sales of its coaxial cable products.

The Company is also a leading producer of flat-ribbon cable, a cable made of wires assembled side by side such that the finished cable is flat. Flat-ribbon cable is used to connect internal components in systems with space and component configuration limitations. The product is used in computer and office equipment components as well as in a variety of telecommunication applications.

International Operations

The Company believes that its global presence is an important competitive advantage as it allows the Company to provide quality products on a timely and worldwide basis to its multinational customers. Approximately 53% of the Company’s sales for the year ended December 31, 2002 were outside the United States. Approximately 49% of such international sales were in Europe. The Company has manufacturing and assembly facilities in the United Kingdom, Germany, France, the Czech Republic, and Estonia and sales offices in most European markets. The Company’s European operations generally have strong positions in their respective local markets. The balance of the Company’s international activities are located in Asia, Canada, Latin America and Australia. Asian operations include manufacturing facilities in Japan, Taiwan, China, Korea, India and Malaysia. The Company’s international manufacturing and assembly facilities generally serve the respective local markets and coordinate product design and manufacturing responsibility with the Company’s other operations around the world. The Company has low cost manufacturing and assembly facilities in Mexico, China, India and Eastern Europe to serve regional and world markets.

Customers

The Company’s products are used in a wide variety of applications by numerous customers, the largest of which accounted for approximately 4% of net sales for the year ended December 31, 2002. The Company sells its products to over 10,000 customer locations worldwide. The Company’s products are sold both directly to OEMs, cable system operators, telecommunication companies and through manufacturers’ representatives and distributors. There has been a trend on the part of OEM customers to consolidate their lists of qualified suppliers to companies that have a global presence, can meet quality and delivery standards, have a broad product portfolio and design capability, and have competitive prices. The Company has focused its global resources to position itself to compete effectively in this environment. The Company has concentrated its efforts on service and productivity improvements including advanced computer aided design and manufacturing systems, statistical process controls and just-in-time inventory programs to increase product quality and shorten product delivery schedules. The Company’s strategy is to provide comprehensive design capabilities, a broad selection of products and a high level of service in the areas in which it competes. The Company has achieved a preferred supplier designation from many of its OEM customers.

The Company’s sales to distributors represented approximately 20% of the Company’s 2002 sales. The Company’s recognized brand names, including “Amphenol,” “Times Fiber,” “Tuchel,” “Socapex,” “Sine,” “Spectra-Strip,” “Pyle-National,” “Matrix,” “Kai Jack” and others, together with the Company’s strong connector design-in position (products that are specified in customer drawings), enhance its ability to reach the secondary market through its network of distributors.

Manufacturing

The Company employs advanced manufacturing processes including molding, stamping, plating, turning, extruding, die casting and assembly operations as well as proprietary process technology for flat-ribbon and coaxial cable production. The Company’s manufacturing facilities are generally vertically integrated operations from the initial design stage through final design and manufacturing. Outsourcing of certain fabrication processes is used when cost-effective. Substantially all of the Company’s manufacturing facilities are certified to the ISO9000 series of quality standards.

The Company employs a global manufacturing strategy to lower its production costs and to improve service to customers. The Company sources its products on a worldwide basis with manufacturing and assembly operations in the Americas, Europe, Asia and Australia. To better serve high volume OEM customers, the Company has established just-in-time facilities near major customers.

The Company’s policy is to maintain strong cost controls in its manufacturing and assembly operations. The Company has undertaken programs to rationalize its production facilities, reduce expenses and maximize the return on capital expenditures. The programs to improve productivity are ongoing.

The Company purchases a wide variety of raw materials for the manufacture of its products, including precious metals such as gold and silver used in plating; aluminum, brass, steel, copper and bimetallic products used for cable, contacts and connector shells; and plastic materials used for cable and connector bodies and inserts. Such raw materials are generally available throughout the world and are purchased locally from a variety of suppliers. The Company is not dependent upon any one source for raw materials, or if one source is used the Company attempts to protect itself through long-term supply agreements.

Research and Development

The Company’s research and development expense for the creation of new and improved products and processes were $24.2 million, $22.6 million and $23.5 million for 2002, 2001 and 2000, respectively. The Company’s research and development activities focus on selected product areas and are performed by individual operating divisions. Generally, the operating divisions work closely with OEM customers to develop highly-engineered products and systems that meet customer needs. The Company focuses its research and development efforts primarily on those product areas that it believes have the potential for broad market applications and significant sales within a one-to-three year period.

Trademarks and Patents

The Company owns a number of active patents worldwide. While the Company considers its patents to be valuable assets, the Company does not believe that its competitive position is dependent on patent protection or that its operations are dependent on any individual patent. The Company regards its trademarks “Amphenol,” “Times Fiber,” “Tuchel,” “Socapex,” “Sine,” “Spectra-Strip,” “Pyle-National,” “Matrix,” “Kai Jack” and others to be of value in its businesses. The Company has exclusive rights in all its major markets to use these registered trademarks.

Competition

The Company encounters competition in substantially all areas of its business. The Company competes primarily on the basis of engineering, product quality, price, customer service and delivery time. Competitors include large, diversified companies, some of which have substantially greater assets and financial resources than the Company, as well as medium to small companies. In the area of coaxial cable for cable television, the Company believes that it and CommScope are the primary world providers of such cable; however, CommScope is larger than the Company in this market. In addition, the Company faces competition from other companies that have concentrated their efforts in one or more areas of the coaxial cable market.

Backlog

The Company estimates that its backlog of unfilled orders was $224.0 million and $229.0 million at December 31, 2002 and 2001, respectively. Orders typically fluctuate from quarter to quarter based on customer demands and general business conditions. Unfilled orders may be cancelled prior to shipment of goods. It is expected that all or a substantial portion of the backlog will be filled within the next 12 months. Significant elements of the Company’s business, such as sales to the cable television industry, distributors, the computer industry, and other commercial customers, generally have short lead times. Therefore, backlog may not be indicative of future demand.

Employees

As of December 31, 2002, the Company had approximately 11,100 full-time employees worldwide. Of these employees, approximately 8,300 were hourly employees and the remainder were salaried. The Company had a one week strike in October 1995 at its Sidney, New York facility relating to the renewal of the labor contract at that facility with the International Association of Machinists and Aerospace Workers. The Company has not had any other significant work stoppages in the past ten years. The Company believes that it has a good relationship with its unionized and non-unionized employees.

Other

The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports are available, without charge, on the Company’s web site, www.amphenol.com, as soon as reasonably practicable after they are filed electronically with the SEC. Copies are also available without charge, from Amphenol Corporation, Investor Relations, 358 Hall Avenue, Wallingford, CT 06492.

Cautionary Statements for Purposes of Forward Looking Information

Statements made by the Company in written or oral form to various persons, including statements made in filings with the SEC, that are not strictly historical facts are “forward looking” statements. Such statements should be considered as subject to uncertainties that exist in the Company’s operations and business environment. The following includes some, but not all, of the factors or uncertainties that could cause the Company to fail to conform with expectations and predictions:

• A global economic slowdown in any one, or all, of the Company’s market segments.

• The effects of extreme changes in monetary and fiscal policies in the U.S. and abroad including extreme currency fluctuations and unforeseen inflationary pressures.

• Severe and unforeseen price pressure on the Company’s products or significant cost increases that can not be recovered through price increases or productivity improvements.

• Increased difficulties in obtaining a consistent supply of basic materials like steel, aluminum, copper, bimetallic products, gold or plastic resins at stable pricing levels.

• Unpredictable difficulties or delays in the development of new product programs.

• Significant changes in interest rates or in the availability of financing for the Company or certain of its customers.

• Rapid escalation of the cost of regulatory compliance and litigation.

• Unexpected government policies and regulations affecting the Company or its significant customers.

• Unforeseen intergovernmental conflicts or actions, including but not limited to armed conflict and trade wars.

• Difficulties and unanticipated expense of assimilating newly-acquired businesses.

• Any difficulties in obtaining or retaining the management and other human resource competencies that the Company needs to achieve its business objectives.

• The risks associated with any technological shifts away from the Company’s technologies and core competencies. For example, a technological shift away from the use of coaxial cable in cable television/telecommunication systems could have a substantial impact on the Company’s coaxial cable business.

• Unforeseen interruptions to the Company’s business with its largest customers, distributors and suppliers resulting from, but not limited to, strikes, financial instabilities, computer malfunctions or inventory excesses.

Item 2. Properties

The Company’s fixed assets include certain plants and warehouses and a substantial quantity of machinery and equipment, most of which is general purpose machinery and equipment using tools and fixtures and in many instances having automatic control features and special adaptations. The Company’s plants, warehouses, machinery and equipment are in good operating condition, are well maintained, and substantially all of its facilities are in regular use. The Company considers the present level of fixed assets along with planned capital expenditures as suitable and adequate for operations in the current business environment. At December 31, 2002, the Company operated a total of 76 plants and warehouses of which (a) the locations in the U.S. had approximately 1.9 million square feet, of which .8 million square feet were leased; and (b) the locations outside the U.S. had approximately 2.4 million square feet, of which 1.3 million square feet were leased.

The Company believes that its facilities are suitable and adequate for the business conducted therein and are being appropriately utilized for their intended purposes. Utilization of the facilities varies based on demand for the products. The Company continuously reviews its anticipated requirements for facilities and, based on that review, may from time to time acquire or lease additional facilities and/or dispose of existing facilities.

Item 3. Legal Proceedings

The Company and its subsidiaries have been named as defendants in several legal actions in which various amounts are claimed arising from normal business activities. Although the amount of any ultimate liability with respect to such matters cannot be precisely determined, in the opinion of management, such matters are not expected to have a material effect on the Company’s financial condition or results of operations.

Certain operations of the Company are subject to federal, state and local environmental laws and regulations which govern the discharge of pollutants into the air and water, as well as the handling and disposal of solid and hazardous wastes. The Company believes that its operations are currently in substantial compliance with all applicable environmental laws and regulations and that the costs of continuing compliance will not have a material effect on the Company’s financial condition or results of operations.

Subsequent to the acquisition of Amphenol from Allied Signal Corporation in 1987 (Allied Signal merged with Honeywell International Inc. in December 1999 (“Honeywell”)), Amphenol and Honeywell have been named jointly and severally liable as potentially responsible parties in relation to several environmental cleanup sites. Amphenol and Honeywell have jointly consented to perform certain investigations and remedial and monitoring activities at two sites and they have been jointly ordered to perform work at another site. The responsibility for costs incurred relating to these three sites is apportioned between Amphenol and Honeywell based on an agreement entered into in connection with the acquisition in 1987. For sites covered by this agreement, to the extent that conditions or circumstances occurred or existed at the time of or prior to the acquisition, Honeywell is currently obligated to pay 80% of the costs up to $30 million and 100% of the costs in excess of $30 million. At December 31, 2002, approximately $29.1 million of costs have been incurred applicable to this agreement. Honeywell representatives work closely with the Company in addressing the most significant environmental liabilities.

Owners and occupiers of sites containing hazardous substances, as well as generators of hazardous substances, are subject to broad liability under various federal and state environmental laws and regulations, including expenditures for cleanup and monitoring costs and potential damages arising out of past disposal activities. Such liability in many cases may be imposed regardless of fault or the legality of the original disposal

activity. The Company is currently performing monitoring activities at its manufacturing site in Sidney, New York. The Company is also performing monitoring, investigation, design and cleanup activities at three off-site disposal sites previously utilized by the Company’s Sidney facility and others, the “Richardson Hill” landfill, the “Route 8” landfill and the “Sidney Center” landfill. The Company and Honeywell have entered into an administrative consent order with the United States Environmental Protection Agency (the “EPA”) and are presently determining necessary and appropriate remedial measures for “Richardson Hill”, which has been designated a “Superfund” site on the National Priorities List under the Comprehensive Environmental Response, Compensation and Liability Act of 1980. With respect to the second site, the “Route 8” landfill, the Company initiated a remediation program pursuant to a Consent Order with the New York Department of Environmental Protection and is continuing to monitor the results of those remediation efforts. In December 1995, the Company and Honeywell received a letter from the EPA demanding that the Company and Honeywell accept responsibility for the investigation and cleanup of the third site, Sidney Center landfill, another Superfund Site. The Sidney Center landfill was a municipal landfill site utilized by the Company’s Sidney facility and other local towns and businesses. In 1996, the Company and Honeywell received a unilateral order from the EPA directing the Company and Honeywell to perform certain investigation, design and cleanup activities at the Sidney Center landfill site. The Company and Honeywell responded to the unilateral order by agreeing to undertake certain remedial design activities. In 1997, the EPA filed a lawsuit against the Company and Honeywell seeking reimbursement of past costs expended by the EPA in connection with activities at the Sidney Center landfill site and seeking to affix liability upon the Company and Honeywell for all additional costs to be incurred in connection with all further investigations, design and cleanup activities at the Sidney Center landfill site. The Company joined four local municipalities as co-defendants in the lawsuit. In 2001 the Company and Honeywell were ordered by the Court to pay the EPA approximately $3.5 million, net of contributions by the municipalities who had been joined as co-defendants in the lawsuit. Pursuant to that decision the Company and Honeywell will be responsible for completing the remedial design work and for implementing any agreed remediation plan at the Sidney Center landfill site. The municipalities who were joined in the lawsuit have agreed to monitor and maintain any caps installed at the Sidney Center landfill site as part of any remediation plan. The Company and Honeywell will be responsible for continuing groundwater monitoring at the site. The Company is also engaged in remediating or monitoring environmental conditions at certain of its other manufacturing facilities and has been named as a potentially responsible party for cleanup costs at other off-site disposal sites. During 2002, the Company incurred costs of approximately $.7 million, net of indemnification payments received from Honeywell, in connection with investigating, remediating and monitoring environmental conditions at all of these facilities and sites. In 2003 Amphenol expects such expenditures, net of expected indemnification payments from Honeywell, to be less than $1.0 million.

Since 1987, the Company has not been identified nor has it been named as a potentially responsible party with respect to any other significant on-site or off-site hazardous waste matters. In addition, the Company believes that all of its manufacturing activities and disposal practices since 1987 have been in material compliance with all applicable environmental laws and regulations. Nonetheless, it is possible that the Company will be named as a potentially responsible party in the future with respect to additional Superfund or other sites. Although the Company is unable to predict with any reasonable certainty the extent of its ultimate liability with respect to any pending or future environmental matters, the Company believes, based upon all information currently known by management about the Company’s manufacturing activities, disposal practices and estimates of liability with respect to all known environmental matters, that any such liability will not be material to its financial condition or results of operations.

Item 4. Submission of Matters to a Vote of Security-Holders

The Annual Meeting of Stockholders was held on May 22, 2002. The following matters were submitted to and approved by the stockholders: (i) the election of three directors, Scott P. Nuttall, George R. Roberts and Dean H. Secord, each for a three year term expiring in the year 2005 and (ii) ratification of Deloitte & Touche LLP as independent accountants of the Company.

Item 4.1 Executive Officers

The following table sets forth the name, age and position with the Company of each person who was an executive officer of Amphenol as of December 31, 2002. Officers are elected to serve at the discretion of the Board of Directors in accordance with the By-Laws of the Company. The By-Laws of the Company provide that the Board of Directors shall elect the officers of the Company at its first meeting held after the Annual Meeting of Stockholders of the Company. All officers of the Company are elected to hold office until their successors are chosen and qualified, or until their earlier resignation or removal.

Name	Age	Position

Martin H. Loeffler	58	Chairman of the Board, Chief Executive Officer and President

Edward G. Jepsen	59	Executive Vice President and Chief Financial Officer

Timothy F. Cohane	50	Senior Vice President

Edward C. Wetmore	46	Secretary and General Counsel

Diana G. Reardon	43	Controller and Treasurer

Martin H. Loeffler has been a Director of Amphenol since December 1987 and Chairman of the Board since May 1997. He has been Chief Executive Officer since May 1996 and President since July 1987.

Edward G. Jepsen has been Executive Vice President and Chief Financial Officer of Amphenol since May 1989 and prior thereto Senior Vice President and Director of Finance since November 1988.

Timothy F. Cohane has been Senior Vice President of Amphenol since December 1994 and prior thereto a Vice President since 1991.

Edward C. Wetmore has been Secretary and General Counsel of Amphenol since 1987.

Diana G. Reardon has been Treasurer of Amphenol since March 1992 and Controller since July 1994 and prior thereto Assistant Controller since June 1988.

PART II

Item 5. Market for the Registrant’s Common Stock and Related Stockholder Matters

The Company effected the initial public offering of its Class A Common Stock in November 1991. The Company’s common stock has been listed on the New York Stock Exchange since that time under the symbol “APH.” The following table sets forth on a per share basis the high and low prices for the common stock for both 2002 and 2001 as reported on the New York Stock Exchange.

	2002		2001
	High	Low	High	Low
First Quarter	51.75	40.25	50.75	28.30
Second Quarter	49.00	35.50	57.99	29.11
Third Quarter	42.46	30.11	45.95	32.00
Fourth Quarter	45.81	27.47	52.95	32.50

As of February 28, 2003 there were 71 holders of record of the Company’s common stock. A significant number of outstanding shares of common stock are registered in the name of only one holder, which is a nominee of The Depository Trust Company, a securities depository for banks and brokerage firms. The Company believes that there are a significant number of beneficial owners of its common stock.

Since its initial public offering in 1991, the Company has not paid any cash dividends on its common stock and it does not have any present intention to commence payment of any cash dividends. The Company intends to retain earnings to provide funds for the operation and expansion of the Company’s business and to repay outstanding indebtedness.

Currently the Company is restricted from declaring and paying any cash dividends on, or repurchasing the Company’s common stock under certain covenants contained in the Company’s debt agreements.

Partnerships affiliated with Kohlberg Kravis Roberts & Co. L.P. (“KKR”) owned 49.1% of the Company’s Class A Common Stock as of December 31, 2002. The Company pays KKR an annual fee of $1.0 million for management consulting and financial services.

Item 6. Selected Financial Data

(dollars in thousands, except per share data)

	Year Ended December 31,
	2002		2001		2000		1999			1998

*Operations*

Net sales	$	1,062,002	$	1,103,771	$	1,359,702	$	1,010,603		$	918,877
Income before extraordinary item	80,344		83,710		107,904		44,295			36,510
Extraordinary loss							(8,674		)
Net income	80,344		83,710		107,904		35,621			36,510

Net income per common share-Diluted:
Income before extraordinary item	1.85		1.95		2.52		1.21			1.02
Extraordinary loss							(.24		)
Net income	1.85		1.95		2.52		.97			1.02

*Financial Position*

Working capital	$	153,250	$	166,857	$	170,131	$	189,252		$	163,508
Total assets	1,078,908		1,026,743		1,004,322		836,376			807,401
Current portion of long-term debt	78,363		59,705		28,130		16,829			1,655
Long-term debt	565,885		660,614		700,216		745,658			952,469
Shareholders’ equity (deficit)	166,982		103,933		29,234		(81,166		)	(292,257		)
Weighted average shares outstanding – diluted	43,445,600		42,997,121		42,878,922		36,664,016			35,884,794

Item 7.

Management’s Discussion and Analysis of Financial
Condition and Results of Operations

The following discussion and analysis of the results of operations for the three fiscal years ended December 31, 2002 has been derived from and should be read in conjunction with the consolidated financial statements contained herein.

Results of Operations

The following table sets forth the components of net income as a percentage of net sales for the periods indicated.

	Year Ended December 31,
	2002		2001		2000
Net sales	100.0	%	100.0	%	100.0	%
Cost of sales, excluding depreciation and amortization	65.9		63.8		65.2
Depreciation and amortization expense	3.3		2.9		2.1
Selling, general and administrative expense	14.4		14.1		13.7
Amortization of goodwill			1.3		1.0
Operating income	16.4		17.9		18.0
Interest expense	(4.3	)	(5.1	)	(4.6	)
Other expenses, net	(.5	)	(.5	)	(.7	)
Income before income taxes	11.6		12.3		12.7
Provision for income taxes	(4.0	)	(4.7	)	(4.8	)
Net income	7.6	%	7.6	%	7.9	%

2002 Compared to 2001

Net sales were $1,062.0 million for the year ended December 31, 2002 compared to $1,103.8 million for 2001. Sales of interconnect products and assemblies decreased 2% compared to 2001 ($892.3 million in 2002 versus $906.8 million in 2001). Such decrease is primarily attributable to decreased sales (approx. $52.8 million) of products and interconnect systems for telecom infrastructure, datacom and industrial markets. Such declines were partially offset by increased sales (approx. $38.3 million) of products and interconnect systems for military aerospace, automotive and wireless handset markets. Sales of cable products decreased 14% compared to 2001 ($169.7 million in 2002 versus $197.0 million in 2001). Such decrease is primarily attributable to a slowdown in capital spending by U.S. and international cable television operators. The lower levels of spending are not expected to change significantly in the near term.

Geographically, sales in the U.S. in 2002 decreased approximately 7% compared to 2001 ($501.1 million in 2002 versus $538.9 million in 2001); international sales for 2002 decreased approximately 1% in U.S. dollars ($560.9 million in 2002 versus $564.8 million in 2001) and decreased approximately 3% in local currency compared to 2001. The comparatively weaker U.S. dollar in 2002 had the currency effect of increasing net sales by approximately $14.4 million when compared to foreign currency translation rates in 2001.

The gross profit margin as a percentage of net sales (including depreciation in cost of sales) was 31% for 2002 compared to 33% for 2001. The decrease in gross profit margin is generally attributable to a difficult pricing environment, particularly in the communications markets, and the adverse effect on production costs of the lower sales volume, partially offset by cost reduction programs. The pricing environment in communication related markets is expected to remain difficult in the near term.

Selling, general and administrative expenses as a percentage of sales remained relatively constant at approximately 14% for both 2002 and 2001.

Goodwill amortization expense was nil in 2002, as a result of adopting FAS No. 142; whereas goodwill amortization was $14.3 million in 2001.

Interest expense was $45.9 million for 2002 compared to $56.1 million for 2001. The decrease is

primarily attributable to lower average debt levels and lower interest rates. At current interest rates, interest expense for 2003 is expected to be approximately $35 million.

Other expenses, net for 2002 and 2001 was $5.4 million and $5.6 million, respectively. See Note 8 to the Company’s Consolidated Financial Statements for details of the components of other expenses, net.

The provision for income taxes for 2002 was at an effective rate of 35% compared to 38% in 2001. For 2001, the effective tax rate, excluding non-deductible goodwill amortization, was 35%.

2001 Compared to 2000

Net sales were $1,103.8 million for the year ended December 31, 2001 compared to $1,359.7 million for 2000. Sales of interconnect products and assemblies decreased 10% compared to 2000 ($906.8 million in 2001 versus $1,009.2 million in 2000). Such decrease is primarily attributable to decreased sales of products and interconnect systems for telecom infrastructure, datacom and industrial markets. Such declines were partially offset by increased sales of products and interconnect systems for military aerospace and automotive markets. Sales of cable products decreased 44% compared to 2000 ($197.0 million in 2001 versus $350.5 million in 2000). Such decrease is primarily attributable to a slowdown in capital spending by certain U.S. and international cable television operators.

Geographically, sales in the U.S. in 2001 decreased approximately 25% compared to 2000 ($538.9 million in 2001 versus $714.8 million in 2000); international sales for 2001 decreased approximately 12% in U.S. dollars ($564.8 million in 2001 versus $644.9 million in 2000) and decreased approximately 9% in local currency compared to 2000. The comparatively strong U.S. dollar in 2001 had the currency effect of decreasing net sales by approximately $22.8 million when compared to foreign currency translation rates in 2000.

The gross profit margin as a percentage of net sales (including depreciation in cost of sales) remained relatively constant at approximately 33% for both 2001 and 2000. Cost reduction activities in 2001 contributed to offsetting the adverse effect of lower sales volume.

Selling, general and administrative expenses as a percentage of sales remained relatively constant at approximately 14% for both 2001 and 2000.

Interest expense was $56.1 million for 2001 compared to $61.7 million for 2000. The decrease is primarily attributable to lower average debt levels and lower interest rates.

Other expenses, net for 2001 and 2000 was $5.6 million and $9.5 million, respectively. See Note 8 to the Company’s Consolidated Financial Statements for details of the components of other expenses, net.

The provision for income taxes was at an effective rate of 38% for both 2001 and 2000.

Liquidity and Capital Resources

Cash provided by operating activities totaled $131.6 million, $118.9 million, and $154.2 million for 2002, 2001 and 2000, respectively. The increase in cash from operating activities in 2002 compared to 2001 is primarily attributable to a net decrease in non-cash components of working capital offset in part by a decrease in net income. In 2001, the decrease in cash from operating activities is primarily attributable to a decrease in net income adjusted for depreciation and amortization charges and to a net increase in non-cash components of working capital.

Cash from operating activities was used for capital expenditures ($18.8 million, $38.6 million and $53.1 million in 2002, 2001 and 2000, respectively), and acquisitions ($33.8 million, $60.5 million, and $67.7 million in 2002, 2001 and 2000, respectively).

The Company has a bank loan agreement (Bank Agreement) which includes a Term Loan, consisting of a Tranche A and B, and a $150 million revolving credit facility. At December 31, 2002, the Tranche A had a balance of $179.5 million and matures over the period 2003 to 2004, and the Tranche B had a balance of $284.5 million and matures over the period 2005 and 2006. The revolving credit facility expires in 2004; and, availability under the facility at December 31, 2002 was $142.8 million, after reduction of $7.2 million for outstanding letters of credit. The Bank Agreement is secured by a first priority pledge of 100% of the capital stock of the Company’s direct domestic subsidiaries and 65% of the capital stock of direct material foreign subsidiaries, as defined in the Bank Agreement. The Bank Agreement also requires that the Company satisfy certain financial covenants including interest coverage and leverage ratio tests, and

includes limitations with respect to, among other things, indebtedness and restricted payments, including dividends on the Company’s common stock.

The Company is currently pursuing a refinancing of its senior credit facilities. The new credit facilities would be used to replace the Company’s existing credit facilities, and may be used to redeem all or a portion of the Company’s outstanding senior subordinated notes.

A subsidiary of the Company has an agreement with a financial institution whereby the subsidiary can sell an undivided interest of up to $85.0 million in a designated pool of qualified accounts receivable. The agreement expires in May 2004 with respect to $60.0 million of accounts receivable and expires in July 2003 with respect to an additional $25.0 million of accounts receivable. At December 31, 2002, approximately $63.2 million of receivables were sold under the agreement and are therefore not reflected in the accounts receivable balance in the accompanying Consolidated Balance Sheet.

The Company’s primary ongoing cash requirements will be for operating and capital expenditures, product development activities and debt service. The Company’s debt service requirements consist primarily of principal and interest on bank borrowings and interest on its 9 7/8% Senior Subordinated Notes due 2007 (“Notes”). The Company’s primary sources of liquidity are internally generated cash flow, the Company’s revolving credit facility and the sale of receivables under the Company’s accounts receivable agreement. The Company expects that ongoing requirements for operating and capital expenditures, product development activities and debt service requirements will be funded from these sources; however, the Company’s sources of liquidity could be adversely affected by a decrease in demand for the Company’s products, a deterioration in certain of the Company’s financial ratios or a deterioration in the quality of the Company’s accounts receivable.

The Company has not paid, and does not have any present intention to commence payment of, cash dividends on its common stock. The Company expects that capital expenditures in 2003 will be approximately $28 million. The Company’s required debt and capital lease amortization in 2003 is $78.4 million; the Company’s required cash interest payments for 2003, at current interest rates, are estimated at approximately $33 million. The Company may also use cash to fund part or all of the cost of future acquisitions.

Disclosures about contractual obligations and commitments

The following table summarizes the Company’s known obligations to make future payments pursuant to certain contracts as of December 31, 2002, as well as an estimate of the timing in which these obligations are expected to be satisfied:

Contractual Obligations (dollars in thousands)	Total		Less than 1 year		1-3 years		4-5 years		More than 5 years
Long-Term Debt	$	642,275	$	77,026	$	234,574	$	330,675
Capital Lease Obligations	1,973		1,337		636
Operating Leases	37,820		12,968		13,376		4,923		6,553
Purchase Obligations	39,958		37,633		2,015		223		87
Other Long-Term Liabilities	3,250		1,125		1,125		1,000

Total	$	725,276	$	130,089	$	251,726	$	336,821	$	6,640

Environmental Matters

Inflation and Costs

The cost of the Company’s products is influenced by the cost of a wide variety of raw materials, including precious metals such as gold and silver used in plating; aluminum, copper, brass and steel used for contacts, shells and cable; and plastic materials used in molding connector bodies, inserts and cable. In general, increases in the cost of raw materials, labor and services have been offset by price increases, productivity improvements and cost saving programs.

Risk Management

The Company has to a significant degree mitigated its exposure to currency risk in its business operations by manufacturing and procuring its products in the same country or region in which the products are sold so that costs reflect local economic conditions. In other cases involving U.S. export sales, raw materials are a significant component of product costs for the majority of such sales and raw material costs are generally dollar based on a worldwide scale, such as basic metals and petroleum derived materials.

Recent Accounting Changes

Effective January 1, 2002, the Company adopted FAS No. 143, “Accounting for Asset Retirement Obligations” and FAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets”. FAS No. 143 addresses the recognition and remeasurement of obligations associated with the retirement of tangible long-lived assets. FAS No. 144 addresses accounting and reporting for the impairment or disposal of long-lived assets, including discontinued operations. There was no effect to the Company’s Consolidated Financial Statements as a result of such adoption.

In June 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 146 (FAS 146), “Accounting for Costs Associated with Exit or Disposal Activities”. The statement addresses financial accounting and reporting for costs associated with exit or disposal activities and requires that a liability for such costs be recognized and measured in the period in which a liability is incurred. The statement is effective beginning January 1, 2003, and is not expected to have a material impact on the Company’s Consolidated Financial Statements.

In November 2002, the Financial Accounting Standards Board issued Interpretation No. 45 (FIN 45), “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others”. The Interpretation addresses the disclosures to be made by a guarantor in its financial statements about its obligations under guarantee. In addition, it also clarifies the requirements related to the recognition of a liability by a guarantor at the inception of a guarantee for the obligations the guarantor has undertaken in issuing that guarantee. The initial recognition and measurement provisions of this interpretation are applicable on a prospective basis to guarantees issued or modified after December 31, 2002. The disclosure provisions became effective December 15, 2002 and had no material impact on the Company’s Consolidated Financial Statements.

In December 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 148

(FAS 148), “Accounting for Stock-Based Compensation - Transition and Disclosure”. FAS No. 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, this statement amends the disclosure requirements of FAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The Company has elected to continue to apply APB Opinion 25, “Accounting for Stock Issued to Employees,” and related interpretations in accounting for stock options, and the disclosures required by FAS 123 and 148 are included in Notes 1 and 4 to the Company’s Consolidated Financial Statements.

In January 2003, the Financial Accounting Standards Board issued Interpretation No. 46 (FIN 46), “Consolidation of Variable Interest Entities”. It requires that the assets, liabilities and results of the activity of variable interest entities be consolidated into the financial statements of the company that has controlling financial interest. It also provides the framework for determining whether a variable interest entity should be consolidated based on voting interest or significant financial support provided to it. This Interpretation is effective July 1, 2003, and is not expected to have a material impact on the Company’s Consolidated Financial Statements.

Pensions

The Company and its domestic subsidiaries have a defined benefit pension plan (“Plan”) covering substantially all U.S. employees. Plan benefits are generally based on years of service and compensation and are generally noncontributory. Certain foreign subsidiaries also have defined benefit plans covering their employees.

Our pension cost (credit) for all pension plans approximated $.7 million, $(.3) million and $(.3) million in 2002, 2001, and 2000, respectively, and is calculated based upon a number of actuarial assumptions established on January 1 of the applicable year, including an expected long-term rate of return on Plan assets. In developing our expected long-term rate of return assumption, we evaluated input from our actuaries and investment consultants as well as long-term inflation assumptions. Projected returns by such consultants are based on broad equity and bond indices. We also considered our historical 13 year compounded return of 10.8%, which has been in excess of these broad equity and bond benchmark indices. Our expected long-term rate of return on Plan assets is based on an asset allocation assumption of 60% with equity managers, with an expected long-term rate of return of 11%, 25% with fixed income managers, with an expected long-term rate of return of 6.75% and 15% with high yield bond managers, with an expected rate of return of 8.5%. Because of market fluctuation, our actual asset allocation as of December 31, 2002 was 50% with equity managers and 50% with fixed income managers, including high yield managers. We believe, however, that our long-term asset allocation on average will approximate 60% with equity managers and 40% with fixed income managers. We regularly review our actual asset allocation and periodically rebalance our investments to our targeted allocation when considered appropriate. Based on this methodology the Company reduced the expected long-term rate of return assumption by 100 basis points to 9.5% beginning in 2003. This will have the effect of increasing pension expense in 2003 by approximately $2 million.

The discount rate used by the Company for valuing pension liabilities is based on a review of high quality corporate bond yields with maturities approximating the remaining life of the projected benefit obligations. The discount rate on this basis has decreased from 7.25% at December 31, 2001 to 6.5% at December 31, 2002. This will have the effect of increasing pension expense in 2003 by approximately $2 million. Although future changes to the discount rate are unknown, had the discount rate increased or decreased 50 basis points, the pension liability would have decreased $9.5 million or increased $10.4 million, respectively.

The financial markets have declined significantly in recent years, which has had an adverse effect on Plan assets. In 2002, this resulted in a $42.5 million non-cash charge to the accumulated other comprehensive loss account component of stockholders’ equity. Such charge represents an increase in the accrued pension liabilities of $67.0 million, net of deferred taxes. The Company estimates that, based on

current actuarial calculations, it will make a cash contribution to the pension plans in 2003 of approximately $7.0 million. Cash contributions in subsequent years will depend on a number of factors including the investment performance of Plan assets.

Critical Accounting Policies and Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant accounting policies are set forth below.

Revenue Recognition - Sales and related cost of sales are recognized upon shipment of products. Allowances for estimated uncollectible accounts, discounts, returns and allowances are provided based upon historical experience, current trends and specific information which indicates that an allowance is appropriate.

Inventories - Inventories are stated at the lower of standard cost, which approximates average cost, or market. Provisions for slow moving and obsolete inventory are provided based on historical experience and product demand.

Depreciable Assets - Property, plant and equipment are carried at cost less accumulated depreciation. The appropriateness and the recoverability of the carrying value of such assets is periodically reviewed taking into consideration current and expected business conditions.

The significant accounting policies are more fully described in Note 1 to the Company’s Consolidated Financial Statements.

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

The Company, in the normal course of doing business, is exposed to the risks associated with foreign currency exchange rates and changes in interest rates.

Foreign Currency Exchange Rate Risk

The Company conducts business in several international currencies through its worldwide operations, and as a result is subject to foreign exchange exposures due to changes in exchange rates of the various currencies. Changes in exchange rates can positively or negatively effect the Company’s sales, gross margins and retained earnings. The Company attempts to minimize currency exposure risk by producing its products in the same country or region in which the products are sold and thereby generating revenues and incurring expenses in the same currency and by managing its working capital; although there can be no assurance that this approach will be successful, especially in the event of a significant and sudden decline in the value of any of the international currencies of the Company’s worldwide operations. The Company does not engage in purchasing forward exchange contracts for speculative purposes.

Interest Rate Risk

The Company is subject to market risk from exposure to changes in interest rates based on its financing activities. The Company has utilized interest rate swap agreements to manage and mitigate its exposure to changes in interest rates. The Company had two fixed rate interest swap agreements totaling $450 million that expired in 2002. At December 31, 2002, the Company’s average LIBOR rate was 1.9%. A 10% change in the LIBOR interest rate at December 31, 2002 would have the effect of increasing or decreasing interest expense by approximately $.3 million. The Company does not expect changes in interest rates to have a material effect on income or cash flows in 2003, although there can be no assurances that interest rates will not significantly change.

Item 8. Financial Statements and Supplementary Data

Report of Management

Management is responsible for the integrity and objectivity of the financial statements and other information appearing in this annual report on Form 10-K. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and include amounts based on management’s best estimates and judgments. The Company maintains a system of internal accounting controls and procedures intended to provide reasonable assurance that assets are safeguarded and transactions are properly recorded and accounted for in accordance with management’s authorization.

Deloitte & Touche LLP has been engaged to audit the financial statements in accordance with auditing standards generally accepted in the United States of America. They obtain an understanding of the Company’s accounting policies and controls, and conduct such tests and related procedures as they consider necessary to arrive at their opinion. The Board of Directors has appointed an Audit Committee composed of outside directors. The Audit Committee meets periodically with representatives of management and Deloitte & Touche LLP to discuss and review their activities with respect to internal accounting controls and financial reporting and auditing.

Independent Auditors’ Report

To the Board of Directors and
Shareholders of Amphenol Corporation

We have audited the accompanying consolidated balance sheets of Amphenol Corporation and subsidiaries as of December 31, 2002 and 2001, and the related consolidated statements of income, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2002. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Amphenol Corporation and subsidiaries as of December 31, 2002 and 2001, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2002 in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 1 to the Consolidated Financial Statements, the Company changed its method of accounting for goodwill and other intangible assets to conform to Statement of Financial Accounting Standards No. 142.

/s/ Deloitte & Touche LLP
Hartford, Connecticut
January 14, 2003

Consolidated Statement of Income

(dollars in thousands, except per share data)

	Year Ended December 31,
	2002			2001			2000

Net sales	$	1,062,002		$	1,103,771		$	1,359,702

Costs and expenses:
Cost of sales, excluding depreciation and amortization	700,302			704,278			886,385
Depreciation and amortization expense	34,825			32,316			29,448
Selling, general and administrative expense	152,928			155,810			186,052
Amortization of goodwill				14,340			13,394
Operating income	173,947			197,027			244,423
Interest expense	(45,930		)	(56,099		)	(61,710		)
Other expenses, net	(5,355		)	(5,573		)	(9,495		)
Income before income taxes	122,662			135,355			173,218
Provision for income taxes	(42,318		)	(51,645		)	(65,314		)
Net income	$	80,344		$	83,710		$	107,904

Net income per common share - Basic	$	1.89		$	2.00		$	2.59
Average common shares outstanding - Basic	42,445,849			41,920,616			41,584,069

Net income per common share - Diluted	$	1.85		$	1.95		$	2.52
Average common shares outstanding - Diluted	43,445,600			42,997,121			42,878,922

See accompanying notes to consolidated financial statements.

Consolidated Balance Sheet

(dollars in thousands, except per share data)

	December 31,
	2002			2001

*Assets*
Current Assets:
Cash and short-term cash investments	$	20,659		$	27,975
Accounts receivable, less allowance for doubtful accounts of $8,812 and $5,191	131,252			113,370
Inventories:
Raw materials and supplies	38,133			41,514
Work in process	111,337			111,409
Finished goods	56,173			55,393
	205,643			208,316
Prepaid expenses and other assets	31,610			20,596
Total current assets	389,164			370,257
Land and depreciable assets:
Land	12,679			11,430
Buildings	95,578			89,104
Machinery and equipment	337,860			315,554
	446,117			416,088
Less accumulated depreciation	(285,427		)	(251,201		)
	160,690			164,887
Deferred debt issuance costs	4,382			5,795
Goodwill	486,841			460,442
Deferred taxes and other assets	37,831			25,362
	$	1,078,908		$	1,026,743

*Liabilities & Shareholders’ Equity*
Current Liabilities:
Accounts payable	$	88,533		$	80,501
Accrued interest	4,957			8,499
Accrued salaries, wages and employee benefits	24,568			24,700
Other accrued expenses	39,493			29,995
Current portion of long-term debt	78,363			59,705
Total current liabilities	235,914			203,400

Long-term debt	565,885			660,614
Accrued pension and post employment benefit obligations	102,418			35,687
Deferred taxes and other liabilities	7,709			23,109

Commitments and contingent liabilities (Notes 2, 6 and 9)

Shareholders’ Equity:
Class A Common Stock, $.001 par value; 100,000,000 shares authorized; 42,571,623 and 42,300,068 shares outstanding at December 31, 2002 and 2001, respectively	43			42
Additional paid-in capital (deficit)	(274,282		)	(280,224		)
Accumulated earnings	522,440			442,096
Accumulated other comprehensive loss	(81,219		)	(57,981		)
Total shareholders’ equity	166,982			103,933

	$	1,078,908		$	1,026,743

See accompanying notes to consolidated financial statements.

Consolidated Statement of Changes in Shareholders’ Equity

(dollars in thousands, except per share data)

	Common Stock		Additional Paid-In Capital (Deficit)			Comprehensive Income			Accumulated Earnings		Accumulated Other Comprehensive Loss			Total Shareholders’ Equity (Deficit)
Balance December 31, 1999	$	41	$	(318,661	)				$	250,482	$	(13,028	)	$	(81,166	)
Comprehensive income:
Net income						$	[107,904	]	107,904					107,904
Other comprehensive loss, net of tax:
Translation adjustments						(10,702		)			(10,702		)	(10,702		)
Comprehensive income						$	[97,202	]
Stock options exercised, including tax benefit			2,501											2,501
Deferred compensation			180											180
279,414 shares issued in connection with acquisitions	1		10,516											10,517
Balance December 31, 2000	42		(305,464		)				358,386		(23,730		)	29,234
Comprehensive income:
Net income						$	[83,710	]	83,710					83,710
Other comprehensive loss, net of tax:
Translation adjustments						(9,612		)			(9,612		)	(9,612		)
Revaluation of interest rate derivatives						(8,837		)			(8,837		)	(8,837		)
Minimum pension liability adjustment						(15,802		)			(15,802		)	(15,802		)
Other comprehensive loss