A M P H E N O L C O R P O R A T I O N 2 0 0 4 A N N U A L R E P O R T  International Operations  Customers  18  The Company's products are used in a wide variety of applications by numerous customers, the largest of which was less  than 4% of net sales for the year ended December 31, 2004. The Company sells its products to over 10,000 customer locations  worldwide. The Company's products are sold both directly to OEMs, contract manufacturers, 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 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 56% of the Company's sales for the  year ended December 31, 2004 were outside the United States. Approximately 48% 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 balance of the Company's international activities are located in Asia, Canada, Latin  America, Africa 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, Africa and Eastern Europe to serve regional and world  markets. 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. 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 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 an opportunity to increase sales of its coaxial cable  products. 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.