Income Statement Detail
Gross margin was 22.2 percent compared to 23.3 percent in the year ago quarter, primarily caused by a product mix shift within our Electrical and Electronic Wire and Cable and Enterprise Cabling and Security Solutions segments. Strong cost management resulted in flat operating expense year-over-year and a 50 basis point improvement in operating expense as a percent of sales, excluding the above mentioned charges.
Interest expense in the current quarter of $16.2 million increased by $4.2 million compared to the prior year quarter as a result of the $4.8 million of incremental expense associated with the second quarter of 2012 bond offering.
Excluding the impact of the impairment, pension-related and restructuring charges, the tax rate in the current quarter was 35.5 percent. In the first quarter of 2012, the Company recorded a benefit of $9.7 million related to the reversal of valuation allowances, and interest and penalties of $1.7 million related to the prior year. In the third quarter of 2012, the Company recorded an impairment charge and an inventory adjustment which reduced operating income by $28.4 million, or $27.4 million net of tax. Excluding all of these charges the full year tax rate was 36.5 percent. The full year results for the prior year included net tax benefits of $10.8 million primarily related to the reversal of deferred income tax valuation allowances, $2.0 million of which was recorded in the fourth quarter. Excluding this benefit, the adjusted tax rate in the prior year fourth quarter and full year was 38.0 percent and 37.4 percent, respectively.Segment Update In December of 2012, the Company announced a change in reportable segments without revising or restating historical financial statements for any period. The new segments are Enterprise Cabling and Security Solutions, Electrical and Electronic Wire and Cable and OEM Supply.
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