Welcome to the Second Quarter Earnings Conference Call for Amphenol Corporation. [Operator Instructions]. I would now like to introduce today's conference host, Mr. Adam Norwitt. Sir, you may begin.

Well, thank you very much and I'd like to offer my greetings to everybody on the call here today. Thank you very much for joining us for our second quarter earnings call. I am Adam Norwitt, CEO of the company and I'm here together today on a very special day with Craig Lampo who is here for his first earnings call as our newly appointed Chief Financial Officer. Our earnings were released this morning and in a moment Craig is going to provide some financial commentary on the quarter. And then I will follow-up with an overview of the business and current trends. And certainly at the end we will have a question-and-answer session as well. But before going into the results I'd like to first introduce Craig Lampo who has been formally appointed as Amphenol's Chief Financial Officer effective yesterday, July 21. And this has followed a very smooth transition period working together with Diana Reardon. And I would like to take this opportunity to express my deepest gratitude to Diana, who has stepped down as CFO after more than 10 years in the role. During that time, as well as during her more than 27 years so far with the company, Diana has made tremendous contributions to the performance of Amphenol. It has been such a pleasure to work with her as CFO and I am especially pleased that Diana will remain strongly connected to Amphenol, both as a senior advisor to me and now as a member of our Board of Directors, to which she was appointed yesterday. Craig Lampo assumes the role of CFO after serving also more than 10 years as our Vice President and Corporate Controller. During that time Craig has worked hand-in-hand with Diana and me to drive the performance of the company and thereby has gained an intimate appreciation of our strategy, operations and the financial management of the company. But most importantly, Craig is a true Amphenolian, steeped deeply in the unique culture of this fine company. And I personally look forward to continuing to work even more closely with Craig in his new role and I'm excited for the long-term positive impact that he will no doubt have on Amphenol's performance. So I would like to please ask you to join me in extending my congratulations both to Diana as our newest Board member and to Craig Lampo as our new Chief Financial Officer. And with that let a me turn it over to Craig for his financial review of the second quarter. Craig, please.

Thank you, Adam. It is my pleasure to be on the call for the first time and to provide some financial commentary on the quarter. The company closed the second quarter with sales of $1.351 billion and EPS of $0.58, excluding one-time items, meeting the high end of the company's guidance. Sales were up 3% in U.S. dollars and 7% in local currencies compared to the second quarter of 2014. From an organic standpoint, excluding both acquisitions and currency, sales in the quarter were up 1%. Sequentially, sales were up 2% in U.S. dollars and 1% organically from the first quarter. Breaking down sales into our two major components, our Cable business which comprised 6% of our sales, was down 10% from last year primarily due to a slowdown in spending by cable operators as well as the effect of translation. The Interconnect business which comprised 94% of our sales, was up 4% from last year reflecting the benefits of both good organic growth and the company's acquisition program partially offset by translation. Adam will comment further on the trends by market in a few minutes. Operating income increased $266 million excluding one-time items in the second quarter. Operating margin, excluding one-time items, increased to 19.7% compared to 19.5% last year, a strong year-over-year conversion margin on incremental sales of 29%. The increase of 20 basis points in operating margins over the prior year resulted from an increase in operating margins in the Interconnect business. From a segment standpoint, in the Cable segment margins were 11.8% compared to 12.7% last year primarily as a result of lower volumes. In the Interconnect segment margins were 21.9%, up 30 basis points from 21.6% last year. The improvement in ROS reflects excellent operating execution both organically and from our acquisitions, in addition to…

Thank you very much, Craig. It is a pleasure, again, to be here. And I will give some discussion around our second quarter achievements. In particular I plan to discuss the trends and progress in our served markets. I'm also going to make some comments at the end about our third-quarter and our full-year guidance. With respect to the second quarter, Craig has certainly given a very comprehensive overview, but I just wanted to reiterate how pleased I am that we've reported such strong performance in sales and EPS despite what has continued to be a very challenging economic environment. We achieved sales of $1.351 billion, 3% increase from prior year in U.S. dollars and 7% in local currencies. And as Craig mentioned, our book to bill was 1.01 to 1, with the orders of $1.362 billion. We're really pleased with the profitability of the company in the quarter which continued to be very strong at 19.7% operating margins. And pleased, in addition that, our EPS reached the high end of guidance at $0.58, growing 7% or twice the rate of our sales growth. Craig also mentioned the increase in the dividend and, just to reiterate, the 12% increase in the company's dividend to $0.56 per year is really just another great confirmation of the financial strength of Amphenol. I can just say how proud I am of our organization who, despite the many challenges and dynamics in the marketplace, was again able to react quickly and capitalize on opportunities across the diverse array of markets that we serve, all while continuing to exercise the discipline and drive necessary to achieve excellent operating performance. It is just yet again a demonstration of the clear strength of Amphenol's entrepreneurial management culture. In the second quarter our small headquarters acquisition team put…

[Operator Instructions]. Our first question came from the line of Amit Daryanani of RBC. Your line is now open.

I have a question and a follow-up. On mobile devices, Adam, you're looking for 40% sequential growth in September. That is probably stronger growth than you have seen for the last several years in September. Maybe you can talk about is it units that you think are going up or is it content for you guys that is driving this much conviction that you can do that? And baked into your full-year numbers how do you think December plays out in mobile devices?

I think it is very strong performance. As you know, over the last several years there are some years where the third quarter is very strong and other years where the fourth quarter is very strong. But no doubt about it, the second half is usually very strong in the mobile device segment; I think this year is no different. As we look towards the third quarter we see really a variety of levers of growth here. And that includes units, that includes content that includes really expansion of the various products that we're offering into the market. We sell such a broad suite of products into that market, everything from antennas and interconnect to mechanisms and even products that go onto the devices as well as products that go to support our customers in their production processes. And so, there is just a real wide array of products that we're selling onto a wide array of applications with a diverse range of customers. Relative to the December quarter, I think you can do the math that we would anticipate at this point that the December quarter would be sequentially down a bit from the third quarter. Again, there are some years where the third quarter is stronger than the fourth and other years where the fourth quarter is stronger than the third. It is not a market that I would ever want to give long-term predictions on the various seasonality and cadence of that market. But this year we're very happy to still be in a very strong position. And I would just one more time emphasize, if you look at our performance in this space, over the last several quarters we had a very strong fourth quarter and a very strong second half last year. We had also a very strong -- a reduction in sales in the first quarter -- if I recall correctly it was nearly 30% from the first quarter to the -- from the fourth quarter to the first quarter we grew 7% sequentially last quarter and now we're going to grow 40% into the third quarter, that is not an easy business to run. And I just give so much credit to our organization being able to flex in such an environment. At the end of the day that is one of the greatest competitive advantages that we have in this space. So few can flex at that level in real-time with the needs of the customers, I think ultimately that allows us to get maybe a little bit more than our fair share of the market opportunity.

And then if I could just follow up on FCI. Could you just talk about what's the historical or the growth rate been for the company for the last few years? And as you integrate this once it closes is it reasonable to say the aspiration when you get closer to the Interconnect margins for Amphenol versus the corporate levels for FCI?

Yes, no, it is an excellent question and again we're just very excited about FCI. FCI has just an outstanding business and I wouldn't necessarily talk about specific growth rates, but I would just tell you that they have had good growth over the recent years. It is a company with a very long legacy. It comes for many, many decades over certain iterations and ownerships. And the business today that we're buying is really the core electronics commercial business of FCI. And that is a business that just has done an outstanding job in gaining position across a wide array of products and markets. I mentioned everything from high-speed to power, input-output connectors, miniaturized connectors and has done a great job on a regional basis as well with customers where we don't necessarily have necessarily that strength. And so, as we think about their future, certainly our aspiration for FCI would be for them to perform at or above the levels of Amphenol. Otherwise we would not have bought the company. And as we think about operating performance, today the company clearly does not perform at the levels of Amphenol. As we talked about in the press release, they have EBITDA margins of around 20%, but their operating margins would be more in the low to mid-teens. And we certainly see great opportunities for FCI over a time period certainly, medium to long time period, to bring themselves up to Amphenol level margins. That has been a recipe that we have applied for many years. In fact, we're coming up to the 10th anniversary of the Teradyne Connection Systems or TCS acquisition. Believe it or not that was 10 years ago December that we acquired TCS. And at the time that was a company that didn't perform at the levels that Amphenol aspired to and was able to achieve. And certainly over the years that organization was able, through being part of Amphenol, to really reach towards much higher levels of profitability. And we would certainly have that long-term aspiration for FCI and long-term goals.

Thank you. Our next question came from the line of Amitabh Passi of UBS. Your line is now open.

Adam, I just had a couple questions for you. On just FCI, are there any cross-licensing agreements or potential revenue dissynergies that we need to be thinking about? Just maybe an overarching comment there.

Sure. No, it is a very good question. There are a couple of licensing arrangements that we have, like we have with many other companies in the industry. But we don't really view that as revenue dissynergies. Those licensing arrangements tend to be relatively -- the second source arrangements tend to have relatively small proportions and we don't see that as any material impact to the business. I mean what we see much more is benefits. When we think about the products and the complementary aspect of those products, as well as the complementary access to customers where there are certain customers where they have done much better and others where we have done much better. And I think being able to bring that full suite of technologies between both those sets of customers is really something that will far outweigh any immaterial revenue kind of dissynergies, as you term it, from cross licensing.

And just a quick follow-up, we have heard from a few other companies in the supply-chain, including semiconductor companies, of increasing levels of caution as the order progressed. I am just curious how things potentially trended for you during the quarter. Did you see a slowing in the quarter and essentially how you would characterize the environment today.

I think I would characterize the environment as throughout the course of the quarter the macro environment, I would say, felt a little worse at the end of the quarter than it felt at the beginning. That didn't necessarily translate into the results of the company, I would say. I think our team did a fabulous job and we had what I would term a pretty normal cadence throughout the quarter in terms of you tend to have a pretty strong June in the second quarter and that was no different in this quarter, but it was a bit more of a fight, I will tell you that. And I think that the overall market environment continues to have a relatively high degree of uncertainty around it and probably throughout the course of the quarter was a bit higher.

Any specific geographies or was that sort of a broad--

No, I would say that it is more broad. I mean, look, I wouldn't -- we're not necessarily a canary in the coal mine for every market and every geography here. But I just think that there is a general sense that there was uncertainty. You have to fight sometimes a little bit harder for the last order.

Thank you. Our next question came from the line of Mark Delaney of Goldman Sachs. Your line is now open.

I was hoping first, Adam, maybe you could elaborate a little bit more on the strength that you are seeing in the mobile devices end market. I know you talked about how it can be volatile from quarter to quarter, but you mentioned specifically that you are participating in things, some directly involved in the manufacturing process. And I'm just wondering is there a one-time nature to some of those sales or is there something that you would have an opportunity to participate in in future years?

Yes, no, look, I think we don't see that as a one-time thing. What I would say is that in the mobile devices market the demand tends to have certain quarters where it is much higher than others. And I don't think that will be any different regardless of whether you are participating on the product side or working with them in the production. There tend to be ramp ups of products, there tend to be ramp ups of production processes and there tend to be then some digestion of those ramp ups. And I think you see that really in the ongoing results of the company over many years where quarter to quarter you have certain quarters that are much stronger in the mobile devices space that tend to be more towards the second half of the year. Not always. I mean we have had in other years where actually the first quarter was not such a bad quarter because there was a certain set of product releases. The cadence of when the activity gets hot and not hot in the mobile devices is something again that doesn't -- that is not entirely predictable in any year, year in and year out. And we don't see that that is a very different dynamic regardless of whether you are selling products that go onto the device or helping to make the device or supporting accessories where we have also a very strong business related to accessories and devices. I think all of those tend to be relatively lumpy and you have got to be in a position where you can strike while the iron is hot, while the opportunity is there. And the better you can be at striking with a real agile organization at that time the more success you can have over the long term.

And then a second follow-up question if you could just help us to contextualize the FCI acquisition versus the broader M&A program at the company. I mean some of the deals the company has done in recent years, GE, Casco and FCI, have been larger. I mean I think to get to deals of this size you have to go back to the Teradyne Connection Systems business you mentioned from 10 years ago. So there has been a noticeable increase in the size of the M&A. I'm just wondering if you can talk about what other opportunities are there of this sort of deal size, hundreds of millions or billion-dollar type acquisitions. And is that the type of size we should expect the company to be looking to execute on going forward?

Sure. Look, I think I have said for many years that we have some very strong criteria for acquisitions. And that is first and foremost technology and we want companies with very, very strong technology. And in addition equal billing with technology is we want outstanding people and then we want that to be complementary to the company. And the criteria that we have never had is size, and I think that while it is true that the FCI acquisition is the largest acquisition we have made in the history of the company in absolute dollars, from a proportional size the TCS acquisition was actually substantially bigger. I think at the time it had sales of close to a third of the size of Amphenol. So I think that we're a bigger company and so we certainly have the capacity to do deals of a wide variety of sizes. In terms of what is out there and what is available and what will be available, it is very hard to say. I mean, there are plenty of companies out there of a certain size. Will they ultimately one day be for sale? There are some that we certainly hope they will be. We're very patient, though. I can tell you that even within FCI, I mean that has been a process of onward close to a decade where we have been knowing that company, having dialogue. And that is very similar to many of the acquisitions that we have made where we develop a very long-term dialogue with those companies. And eventually there comes an inflection point where the owner of the company, be that the owner/operator or in this case the financial owner, decides that they are ready to consider selling that. And I think that there are large companies that are out there. Will those be in the near-term or even medium-term actionable from an acquisition standpoint? That is very hard to say. So it doesn't mean that we won't do acquisitions also of smaller size. As you saw in the quarter, we made two other acquisitions, $20 million in size, $50 million in size. We will continue to pursue a very broad range of acquisition targets all around those criteria of having strong technology outstanding people and complementary market positions.

Thank you. Our next question came from the line of Mr. Mike Wood of Macquarie. Your line is now open, sir.

Regarding industrial and just local consumption oriented markets in China, there are two markets where some industrial companies had been reporting softness. Can you just speak to what Amphenol is seeing there? And regarding those trends, has there been any destocking or you think maybe sell-in is underperforming sell-through?

Yes. So, when you talk about industrial in certain of these geographies, I wouldn't necessarily say that the performance of our industrial business in this case was really geographically focused. I mean there was nothing really of note geographically in our performance. I think I mentioned that we saw a continued and relatively significant decline in our sales to oil and gas markets. That is not geographical; I mean there is oil and gas in business in Asia, in Europe and in North America. We also saw some declines in rail mass transit as well. I think rail mass transit -- maybe there was a little bit more of that decline in Asia, but not so material to the impact. So I wouldn't necessarily characterize the performance of our industrial business on a geographical basis. The strength that we saw in places like heavy equipment and instrumentation, again just on an organic basis, were not necessarily geographically focused either. I think those were in new areas where we have new technologies and in particular where we have seen just this increasing prevalence of adoption of new electronics onto industrial equipment. And that is something that we see in particular in the heavy equipment and the sort of agriculture and mining and those type of very harsh environment large equipment areas of the industrial market where there is, seems to be actually quite an acceleration of the adoption of electronics. As companies by to embed more functionality in their devices and in their equipment in order to compete in a marketplace which is maybe not so favorable.

And as a follow can you just speak to your capacity? You mentioned your M&A pipeline, but just in terms of the leverage which I roughly calculate around two times EBITDA after FCI would be closed. Do you feel at all constrained by additional deals this year or by an operational capacity?

Sure. I will take that one. At the end of the quarter -- I mean the answer is no. At the end of the quarter the company has in excess of $2.1 billion of capacity between our cash and revolver availability. Not to mention certainly our strong operating cash flow that the company continues to generate. As we previously disclosed, we have earmarked about $1.3 billion of that capacity for acquisitions of FCI, the majority of which will be funded with our international cash. And certainly while this is a somewhat bigger deal than we've done in the past, as Adam just mentioned, relative to the size of Amphenol, certainly it is not our large deal. And certainly is well within the company's capital leverage capacity given full and appropriate consideration to certainly the importance of our ratings. In the future we will certainly continue to have a thoughtful and balanced approach to deploying our capital and financial strength, giving appropriate consideration and priority of certainly first to our acquisition program and then to our dividend program and probably lastly, to our stock buyback program. So in the near-term, depending on future acquisition activity, including FCI, that weighting may be a little bit more skewed towards our acquisition program. But as a management team we believe this certainly provides the best long-term return to our shareholders.

Thank you. Our next question comes from the line of Shawn Harrison of Longbow Research. Your line is open.

And Craig, congrats on the official appointment, wanted to dig in a little bit more on just mobile infrastructure in terms of where you are seeing the incremental weakness by geography, if you could help us out with that. And the weakness that you are seeing in the back half, does that mean that you are seeing projects spill into 2016 or is this stuff just -- that is not going to be built out?

Yes, no. I think it is actually pretty interesting. When you look at it on a year-over-year basis in local currency, essentially all geographies are down by the same amount. And so, the amount by which we were down, that kind of 23% in local currency, that was spot on in each geography really kind of the same number. And while that is a coincidence of course, because there is not necessarily a correlation, I think it is indicative of one thing. And that is that you had a very significant build out cycle last year, no doubt about it. And there is always some digestion. But in addition to the digestion there is a little bit of what I would call indigestion that comes from a few [Technical Difficulty] happening. And one of those is just broadly in the carrier space there is a lot of activity, corporate activity, mergers, discussions, acquisitions, regulatory things that are happening. That is one. And then you see that is more in the West in North America in particular and then a little bit in Europe. But you have also in China some government-related actions that are happening that are also keeping a damper on the mobile infrastructure spending in the first half. I think as we look towards the second half we do anticipate the second half being stronger than the first half, just not at the level that we had originally come into the year talking about. I mean if you remember, Shawn, very well, last quarter we also had to adopt a bit more negative view of this market and we incrementally feel a little more negative this time. And that doesn't feel so great in that wireless infrastructure market. But it just appears that the spending is being extended…

And just as a follow-up on FCI, I guess one of the concerns I have received is that, FCI being owned by private equity for a number of years now, almost 10, maybe Bain has squeezed a lot of blood from the stone. How do you generate the margins and push margins higher in that business? Is it revenue synergies? Is it ways to sprinkle -- I don't know if this is the best term -- the Amphenol dust on the business and bring it into the fold and there is opportunities there? Is there something else? Because I guess the general concern is that Bain was running it pretty lean. What opportunities does Amphenol have to improve the cost structure and margin profile?

Sure, it is an excellent question. And it is true, Bain owned it for nine years and I think by owning it for so long, by the way, we're not able to kind of starve the business either. They had to and they did continue to invest very strongly in the business over many years. As we look towards the operating improvements, I think you mentioned a number of things and I am not going to claim that we have pixie dust at Amphenol. But we certainly have an approach in the company towards expansion of operating profitability and really alignment of accountabilities such that you achieve that operating profitability. And that is something that we will work very hard with the FCI team, who is very excited, by the way, to be a part of that entrepreneurial culture. And we think that in and of itself has tremendous impacts on the profitability of the company. That was something we saw at the time with TCS that is something that we have seen with the GE sensors business. I mean time and again when you bring a company in that has come maybe from a slightly different approach and you bring them into that decentralized, accountable model of Amphenol you have really some fabulous impact that comes from that. Obviously from a revenue and a technology, I mean there are a lot of great, great opportunities to leverage the unique technologies that each of us have where collectively we can create better solutions for our customer either better cost solutions or better technology solutions. I mean FCI has just certain really fantastic innovations across the company where we will seek to apply some of those innovations more broadly across Amphenol and vice versa. And I think that that can also have a great impact on the overall operating results of the company.

Thank you. Our next question came from the line of Sherri Scribner of Deutsche Bank. Your line is now open.

Adam, I was hoping you could help us think through the guidance. It looks like you took the full-year guidance up at the low end but kept the high end the same. But the third quarter numbers look better than most people's expectations. So that implies that the fourth quarter was a bit lower than people's expectations. It seems to me that that is probably related to the seasonality of the mobile devices segment this quarter. But was hoping you could give us some thoughts on that seasonality this year and the fact that the guidance didn't really change that much.

Sure. No, I think you have answered your own question, Sherri, as far as I am concerned. As usual, you do the analysis perfectly. It is very true that we have raised -- we never gave third-quarter guidance, first of all. So I think we have always given full-year guidance and we're very happy to be able to sustain that full-year guidance. I think we feel that the third quarter is strong in mobile and I think I already mentioned that we would anticipate in the December quarter to see a little bit of a sequential moderation in our sales into the mobile devices market. I think relative to that full-year guidance we have obviously the benefit of the two acquisitions. And I mentioned as well that from an organic standpoint we see our range at really a 3% to 4% organic growth range. And that is a slight tick down from what we had seen before all for the reasons that I discussed in the various markets and in particular across the carrier market. So, I think that the uncertainty in particular in those carrier-based markets, the mobile infrastructure and broadband markets, with all that is going on in that space that injects maybe a little bit more dose of conservatism into our outlook. But net-net we're extremely pleased to have that guidance really holding at the high end, bringing that up at the low end and with a real strong sense of confidence given a market environment that we think has incrementally gotten a little bit more challenging throughout the course of the quarter.

And it actually feeds into my follow-up which was in the press release you noted an increased level of uncertainty globally. In answer now you just suggested maybe that is just related to the carrier segment. But wanted to get a sense of where you are seeing the uncertainty. Is it generally pretty broad, is it some segments like carrier or is it some other segments too? Thank you.

No, I think when I talked about the carrier, that is really the specific impact to our outlook. I think the general comment about uncertainty in the marketplace is really more of a general one. As I mentioned I think early on, just as the quarter went on it was a little bit more of a fight to get the orders. I think our team is really up to the task and they did a fantastic job given that environment and we're confident that we will continue to do an excellent job given that environment going forward.

Thank you. Our next question comes from the line of William Stein of SunTrust. Your line is now open.

Congratulations on the good outlook relative to what we're seeing elsewhere. And that is really what I would like to focus on. One of the areas that some other component and semiconductor companies have talked about is channel inventory adjustments denting their Q3 outlooks. I am wondering if you are saying anything in this regard, if you are seeing any actions by either end customers or the channel in reducing inventory?

Yes, look, in the channel as it is distribution, distribution represents under 13% of our sales in the quarter. And I don't know that we have seen anything really marked in terms of massive inventory reduction or changes. I wouldn't say that the distribution channel has been very frothy in the quarter. And when we talk about it being a little bit more of a fight, maybe there is some component of that that is related to distribution. But again, it hasn't been that there was like a pivot in the behavior of our distributors or in the behavior of the sell-through with our distributors. I think that it is just a little bit more sometimes of a challenge and maybe a little bit more of a conservatism on their part, but we don't see big inventory reductions, pullbacks, massive corrections coming out of that channel right now.

And one follow-up if I can, I'm wondering if you might give us an update on the progress of the sensor business? You have done a couple of acquisitions there in the last year or two. And I know that you highlighted some design wins in particular in automotive I think. Maybe you could just kind of give us an update on how that part of the business is progressing?

Sure. No, look, we continue to be really excited about our sensor business. It is coming up, believe it or not, on a year and a half. We passed the year and a half mark of owning the GE sensors business; end of this year it will already be two years. Time flies. And Casco was acquired nearly a year ago. And I would just reiterate, as I have said on the last several calls, that we feel really excited about that. And we continue to get great affirmation from customers that us owning a sensor business is a really good thing for the company, a good thing for our customers and a good thing for the technology solutions that we can provide. We're working very hard on a very collaborative basis across the company to uncover and to pursue opportunities where we can really bring in a sensor and an interconnect together with maybe our industrial business or our automotive business. And I would say that we have had good wins in that area. I wouldn't point to anything that is really material to the outlook of the company as yet, but I think the long-term prognosis for our sensor business is excellent as is the long-term prognosis for the opportunity of having that sensor and interconnect solution. The ability to package the sensor together with a harsh environment or otherwise interconnect solution is something that is very special. And it is something that our customers appear to have a great desire to engage with us on.

Thank you. Our next question comes from the line of Craig Hettenbach of Morgan Stanley. Your line is now open.

I guess it is not pixie dust, maybe the word is Amphenolian. But just on the automotive business, that has come quite a far way in the last couple years through a mix of the organic as well as acquisitions. Can you talk about where you are from a penetration standpoint and how much you have to gain from that versus just the overriding increasing content theme?

Sure. I mean, look, we're still small on a relative basis compared to some of the major participants in the space. But we're a little bit less small than we were five years ago, that is -- there is no doubt about it. And we have made outstanding acquisitions over those five, six years and we have continued to do that here in the quarter -- at the end of the second quarter with DoCharm. And I think when I look at that business today and I compare that business to circa 2009, a couple of things. Number one is a much broader offering of products across a broader range of applications. That is number one. Number two is we now have kind of at a minimum a foot in the door, sometimes a leg and sometimes even the whole body, but at a minimum a foot in the door with the vast majority of major automotive OEMs in most geographies. I think with the exception of Japan where we have never had a strong position. And I wouldn't say that we have necessarily gained that strong position even if, with some of the Japanese OEMs outside of Japan, we have actually gained a strong position. And then the third is just regionally. Where our automotive business would have been six years ago two-thirds or three-quarters European, today that automotive business is actually quite balanced on a regional basis. Europe is still marginally the largest territory. But really it is marginal as compared to North America and Asia. And with the acquisition that we've just made, that will bring even a stronger position with us in China both with the international as well as the indigenous participants in China. And look we certainly read the papers and hear everybody talking about is there a downturn in China and all of this. I mean the reality is we have still such a small position and still so much to gain across the range of electronics in those cars that we still feel a great sense of confidence in our automotive business. And I think ultimately that has translated into the strong performance we had this quarter, 16% organic growth in the quarter and our continued outlook where we anticipate still for the year to have kind of mid-teens organic growth in the automotive market. And that is clearly not reflective of just rising with the tide in overall unit sales. So there is a lot of gaining of position on new applications with new products from us that is really driving that growth.

Just as a quick follow-up, you mentioned just some of the change occurring in the data center. That has been another area of potential concern in terms of is there any slowing on the hyper scale side. Any insight in terms of kind of what you are seeing from data center growth into the back half?

Sure. I think I did talk about the fact that we had a good quarter in IT datacom compared to the overall market. We still anticipate kind of a mid-single-digit growth in the IT datacom market for the year. There is no question, this transformation that is happening in the IT datacom market, the real shifting of the balance of power from traditional OEMs building boxes and putting them in boxes and shipping them to this more sort of Web 2.0, cloud web service, I mean there is so many different names you can call it. That transformation continues unabated. And I think that shifting of the balance of power is a very dangerous time in the market for someone who is caught unawares. And I think our team has just done an outstanding job and we've made a lot of real significant organizational moves, let me say. Taking people who were really strong people focused on certain areas and saying, I am cutting the cord with you there and putting you into something totally new. It is hard for them because now they have got to go from wearing a tie to wearing shorts and Birkenstocks when they go to the customers. But ultimately that transformation of our people and then the tailoring of the technologies to what the needs of the web service company that is something that we think is going to bear fruit long-term. You've got to chase where the money is in a space like this and I think that we have done so far a great job of that. But it is not a space without its peril when you see the dramatic change that is happening in that area.

Thank you. Our next question came from the line of Jim Suva of Citi. Your line is now open.

And to make up for my lack of smartness I will just ask one question with no follow-ups. Can you just help us understand, FCI has been around for a very long time with a long history, although the company has gone through a lot of international restructuring challenges and you announced that you are acquiring FCI Asia. Can you help us better understand what does that all include? Geographic reach? A lot of their businesses over the past decade or 15 years have kind of been divested or slowed or closed down or things like that. Are you acquiring all that is left in FCI? And if so is there still much heavy lifting to do to get it integrated? Or in the past their cost structure has been very French and Spanish and kind of Western Europe high cost basis. If you'd just help us understand kind of what you are all buying here and what type of effort it is going to take. Thank you.

Thank you, Jim, actually this was much more than one question, so you are still very smart. Let me just clarify relative to FCI Asia, as it is called, that is the legal name of the company. FCI is a global company, it happens to be headquartered in Singapore. It has a long history and it was originally, well let me say on an interim basis it was a French company. Long ago [indiscernible] Electronics which is one of the predecessor companies, was certainly an American company. But FCI as a global business is really around the world. They moved the headquarters to Asia a couple of years ago. It is true that FCI used to have several other businesses which over a certain number of years Bain took the approach to divest them kind of one by one. They had in automotive business, I'm sure everybody is familiar with that. They had a power business, a real high-voltage business that was divested a number of years back. They had also this what was called microelectronics business which was a very specialized business that was also divested. And we're buying really the totality of what Bain owns today which was originally known as FCI Electronics which was the commercial electronics interconnect business of FCI and that was always the piece of FCI that we had our eye on for this nearly a decade. And in terms of the heavy lifting that has been done, I mean the company has a great performance and it has performed better than maybe it did in the past. But we still see excellent opportunities in the future to improve operating performance of the business. And I think I already discussed a number of the different levers that we intend to exercise as we look towards improving the performance of FCI.

Thank you. Our next question came from the line of Mr. Steven Fox of Cross Research. Your line is now open.

Just a couple quick ones around some of the comments you made, Adam, on acquisitions. On the two acquisitions announced today I was wondering if you could just provide a couple of examples around where some of the European deals you said they have, RF interconnect exposure into the industrial markets. Can you give us some examples of that? And similarly, for the Chinese business, where you said automotive lighting that complements some other deals you have done, can you just give us a couple of examples of that? And then I had a quick follow up.

So first with ProCom, ProCom is actually an antenna company. Sorry if I misspoke. It expands our RF interconnect and antenna offering, but it is really a focused antenna company in the industrial market and really predominantly in the industrial market. It is a very special business in that they make antennas get used in very harsh environments. I mean take for example on a freighter ship where you have very complex wireless communications that have to happen on a freighter in the middle of the ocean. They would make those type of antennas. They make antennas that are used in emergency radio systems for police and fire departments. They make -- just a real wide variety of antennas that are used across a range of applications where we today don't participate. And that is what is so exciting about ProCom. It is obviously a small company, just over $20 million in sales. But it is a company with a unique technology, then we would look to expand their presence to other geographies where today they are a very European focused company. And together with our strong presence on industrial interconnect and with industrial customers we see here a great opportunity to leverage that antenna business into a new market area beyond just the wireless communications of mobile devices and mobile infrastructure where today we have a very strong position. Relative to DoCharm, I did mention that DoCharm has -- one of their main specialties is around complex interconnect assemblies that go into automotive lighting applications. You may recall that a number of years ago we acquired a company called [indiscernible] was really one of the leaders in automotive lighting in Europe and North America and that business has just done fantastic with us since we acquired it. What we…

And then just really quickly, during your prepared remarks you mentioned that Goldstar and Casco were helping organic growth. And I was just wondering if you can clarify whether that was sales synergies with existing businesses or bringing their business into your customers? Or were you just referring to their own growth on a standalone basis? Thanks.

Yes, sorry, again if I misspoke, Steve, I apologize. But I did not mean that they were helping our organic growth, I meant that our overall growth was aided by the additions of Goldstar and Casco.

Thank you. Our next question came from the line of Wamsi Mohan of Bank of America Merrill Lynch. Your line is now open.

Adam, relative to most of your recent acquisitions, FCI appears to be very different in that you need to do a lot more heavy lifting with integrations, whereas in many of your other acquisitions you tended to acquire entities that just leveraged your scale, reach and technology, but you don't have to sort of do much in terms of integration. So two questions, one, what are you expecting in terms of integration cost for this acquisition? Will you be including that in your non-GAAP earnings as you refer to accretion? And secondly, should we expect to see more acquisitions from Amphenol given the relative size that you are now as a company that you would need to go after targets where you would have to on an ongoing basis be more involved in integration? Thanks.

I think it is true that FCI is a larger company and that it has maybe some work to be done as it joins with Amphenol in terms of aligning it appropriately in the business. But let's not forget that the core thing that we look to do in companies like that is to just instill the culture of Amphenol. I think we talked about at the time when we acquired GE sensors that that was a very different culture, it was a very different organization. And there was maybe a little bit more work that we had to do in that case to align the company towards and Amphenol like measure of accountability and operating discipline and really to bring that sort of cultural change into the company. And that comes down to essentially making sure that you have got direct line management, general managers who run businesses to which they are held accountable and for which they have authority. And I think that is the main thing that we would make sure is the case here with FCI. I think we have really the -- all wherewithal to make sure that that is the case. We have a great playbook to apply. And ultimately it doesn't mean that we're going in and monkeying around with the whole thing, but rather we're making sure that there are the appropriate accountabilities for the focus businesses within FCI. By the way, that is something that the current and soon-to-be prior owners were already heading towards with FCI. As they migrated the business as they drove that towards more accountability, they were in many respects looking to emulate Amphenol already. And so, I think we can just accelerate that emulation a little bit as it joins with us. And maybe I'll let Craig comment a little bit on just how we would view costs related to the acquisition.

Sure. I mean we would expect some similar charges to those we've had in the past for things like transaction-related fees, expenses and purchase accounting-related items like inventory and backlog valuations that would be amortized early in the first year and these items certainly would be one-time in nature and we would call these out. In addition, certainly given the size of the deal, it is possible that there could be some other nonrecurring charges. If so we would certainly call them out.

At this point we don't have any more questions over the phone.

That is very good. Well, thank you again, everybody for your attention today. I know it is a busy day for all of you and we truly appreciate your time and I hope it is not too late to wish you all a very enjoyable and pleasant summer. Hopefully you will get, after this busy earning season a little bit of time to have some vacation with your families. Thanks again and we will talk to you all in about 90 days.

Thank you.

Thank you for attending today's conference and have a nice day.