AVX Corporation
Annual Report 2015

Plain-text annual report

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549 FORM 10-K ☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended March 31, 2015 ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934For the transition period from _________ to__________ Commission File Number: 1-7201(Exact name of registrant as specified in its charter)Delaware 33‑0379007(State or other jurisdiction of incorporation or organization) (I.R.S. employer identification number) 1 AVX Boulevard, Fountain Inn, South Carolina 29644(Address of principal executive offices) (Zip Code)(864) 967-2150(Registrant's telephone number, including area code)Securities registered Pursuant to Section 12(b) of the Act: Title of each className of each exchange on which registeredCommon Stock, $.01 par value per shareNew York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.Yes ☒ No ☐ Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the SecuritiesAct. Yes ☐ No ☒ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file suchreports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, everyInteractive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months(or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S‑K is not contained herein, and willnot be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference inPart III of this Form 10‑K or any amendment to this Form 10‑K. ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smallerreporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule12b-2 of the Exchange Act.Large accelerated filer☐ Accelerated filer☒Non-accelerated filer☐(Do not check if a smaller reportingcompany)Smaller reporting company☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ Based on the closing sales price of $13.28 on September 30, 2014, the last business day of the registrant's most recently completedsecond fiscal quarter, the aggregate market value of the common stock held by non‑affiliates of the registrant as of that date was$612,969,847. As of May 15, 2015, there were 168,121,418 shares of the registrant’s common stock, par value $.01 per share, outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive proxy statement for the 2015 Annual Meeting of Stockholders, which will be filed within 120days of March 31, 2015, are incorporated by reference into Part III. 2 TABLE OF CONTENTSPart I PageItem 1.Business5 Item 1A.Risk Factors13 Item 1B.Unresolved Staff Comments 20 Item 2.Properties 21 Item 3.Legal Proceedings 22 Item 4.Mine Safety Disclosures 22 Part IIItem 5.Market for the Registrant's Common Equity, Related Stockholder Matters and IssuerPurchases of Equity Securities23 Item 6.Selected Financial Data25 Item 7.Management's Discussion and Analysis of Financial Condition and Results of Operations 27 Item 7A.Quantitative and Qualitative Disclosures About Market Risk40 Item 8.Financial Statements and Supplementary Data41 Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure41 Item 9A.Controls and Procedures 41 Item 9B.Other Information42 Part IIIItem 10.Directors, Executive Officers and Corporate Governance42 Item 11.Executive Compensation 43 Item 12.Security Ownership of Certain Beneficial Owners and Management and RelatedStockholder Matters43 Item 13.Certain Relationships and Related Transactions, and Director Independence43 Item 14.Principal Accounting Fees and Services 43 Part IVItem 15.Exhibits and Financial Statement Schedules43 Signatures 45 3  Cautionary Statement Pursuant to Safe Harbor Provisions of the Private SecuritiesLitigation Reform Act of 1995The following discussion and analysis should be read in conjunction with the consolidated financial statements, including thenotes thereto, appearing elsewhere herein. Statements in this Annual Report on Form 10-K that reflect projections or expectationsof future financial or economic performance of AVX Corporation, and statements of the Company's plans and objectives forfuture operations, including those contained in “Business”, “Risk Factors”, “Management’s Discussion and Analysis of FinancialCondition and Results of Operations”, and “Quantitative and Qualitative Disclosures about Market Risk”, or relating to theCompany’s outlook for overall volume and pricing trends, end market demands, cost reduction strategies and their anticipatedresults, and expectations for research, development, and capital expenditures, are “forward-looking” statements within themeaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, asamended. Words such as “expects”, “anticipates”, “approximates”, “believes”, “estimates”, “intends”, and “hopes” andvariations of such words and similar expressions are intended to identify such forward-looking statements. No assurance can begiven that actual results or events will not differ materially from those projected, estimated, assumed, or anticipated in any suchforward-looking statements. Important factors that could result in such differences, in addition to the other factors noted withsuch forward-looking statements and in “Risk Factors” in this Annual Report on Form 10-K, include: general economicconditions in the Company's market, including inflation, recession, interest rates, and other economic factors; casualty to or otherdisruption of the Company's facilities and equipment; potential environmental liabilities; and other factors that generally affect thebusiness of manufacturing and supplying electronic components and related products. Forward looking statements are intendedto speak only as of the date they are made and AVX Corporation does not undertake to update or revise any forward-lookingstatement contained in this Annual Report on Form 10-K to reflect new events or circumstances unless and to the extent requiredby applicable law.4 PART I Item 1.Business General AVX Corporation (together with its consolidated subsidiaries, “AVX” or the “Company”) is a leading worldwidemanufacturer and supplier and reseller of a broad line of passive electronic components, interconnect devices, and relatedproducts. Virtually all types of electronic devices use our passive component products to store, filter, or regulate electric energy. Our passive electronic component products include ceramic and tantalum capacitors, film capacitors, varistors, filters, andother components manufactured in our facilities throughout the world and passive components manufactured by KyoceraCorporation of Japan (“Kyocera”), a public company and our majority stockholder, which owns approximately 72% of ouroutstanding common stock, and other manufacturing suppliers. We also manufacture and sell electronic connectors and inter-connect systems and distribute and sell certain electronic connectors manufactured by Kyocera. We are organized by product line with five main product groups. Our reportable segments are based on the types of productsfrom which we generate revenues. We have three reportable segments: Passive Components, Kyocera Electronic Devices (“KEDResale”), and Interconnect. The product groups of Ceramic Components, Advanced Components and Tantalum Componentshave been aggregated into the Passive Components reportable segment. Segment revenue and profit information is presented inNote 15 to the consolidated financial statements. The Passive Components segment consists primarily of surface mount andleaded ceramic capacitors, RF thick and thin film components, surface mount and leaded tantalum capacitors, surface mount andleaded film capacitors, ceramic and film power capacitors, super capacitors, EMI filters (bolt in and surface mount), thick and thinfilm packages of multiple passive integrated components, varistors, thermistors, inductors, and resistive products. The KED Resalesegment consists primarily of ceramic capacitors, frequency control devices, SAW devices, sensor products, RF modules, actuators,acoustic devices, and connectors produced by Kyocera and resold by AVX. The Interconnect segment consists primarily of AVXInterconnect automotive, telecom, and memory connectors manufactured by or for AVX. In addition, we have a corporateadministration group consisting of finance, legal, EHS, and administrative activities. Our customers are multi-national original equipment manufacturers, or OEMs, independent electronic componentdistributors, and electronic manufacturing service providers, or EMSs. We market our products through our own direct sales forceand independent manufacturers' representatives, based upon market characteristics and demands. We coordinate our sales,marketing, and manufacturing organizations by strategic customer account and globally by region. We sell our products to customers in a broad array of industries, such as telecommunications, information technologyhardware, automotive electronics, medical devices and instrumentation, industrial instrumentation, transportation, energyharvesting, defense and aerospace electronic systems, and consumer electronics. Our principal strategic advantages include: Creating Technology Leadership. We have research and development locations in the United States, United Kingdom, CzechRepublic, France, Israel, Malaysia, and Japan. We developed numerous new products and product extensions during fiscal 2015and won several awards that recognize our technology leadership. These new products add to the broad product line we offer toour customers. Due to our broad product offering, none of our products individually represent a material portion of ourrevenues. Our scientists are working to develop product solutions to the challenges facing our customers as consumers andbusinesses demand more advanced electronic solutions to manage their everyday lives and businesses. Our engineers arecontinually working to enhance our manufacturing processes to improve capability, capacity, and yield, while continuing to reducemanufacturing costs. Providing a Broad Product Line. We believe that the breadth and quality of our product line and our ability to quicklyrespond to our customers’ design and delivery requirements make us the provider of choice for our multi-national customer base.We differentiate ourselves by providing our customers with substantially complete passive component solutions. This broad arrayof products allows our customers to streamline their purchasing and supply organization. 5 Maintaining the Lowest Cost, Highest Quality Manufacturing Organization. We have invested approximately $100 million overthe past three fiscal years to upgrade and enhance our worldwide manufacturing capabilities, with respect to the manufacture ofceramic, tantalum, and advanced components as well as Interconnect devices. In order to continually reduce the cost ofproduction, our strategy has included the transfer to and expansion of manufacturing operations in countries such as El Salvador,Malaysia, Mexico, and the Czech Republic. Globally Coordinating our Marketing, Distribution, and Manufacturing Facilities. We believe that our global presence is animportant competitive advantage as it allows us to provide quality products on a timely basis to our multi-national customers. Weprovide enhanced services and responsiveness to our customers by maintaining significant manufacturing operations in locationswhere we market the majority of our products. Our 20 manufacturing facilities are located in 11 different countries around theworld. As our customers continue to expand their global production capabilities, we are ideally situated to meet their design andsupply requirements. Products We offer an extensive line of passive components designed to provide our customers with “one-stop shopping” forsubstantially all of their passive component needs. Passive components do not require power to operate. These components adjustand regulate voltage and current, store energy, and filter frequencies. Sales of Passive Components represented approximately 68%of our net sales in fiscal 2015. KDP and KCD Resale represented approximately 17%, and Interconnect products, togetherwith KCP Resale Connectors, represented approximately 15% of our net sales in fiscal 2015. The table below presents revenuesfor fiscal 2013, 2014 and 2015 by product group. Financial information concerning our Passive Components, KED Resale, andInterconnect segments is set forth in Note 15 to the consolidated financial statements elsewhere herein. Fiscal Year Ended March 31,Sales revenue (in thousands)201320142015Ceramic Components$173,315 $193,978 $202,719 Tantalum Components330,209 394,119 355,974 Advanced Components346,543 357,900 359,315 Total Passive Components850,067 945,997 918,008 KDP and KCD Resale377,707 293,048 229,869 KCP Resale Connectors61,809 64,680 70,741 Total KED Resale439,516 357,728 300,610 Interconnect124,817 138,879 134,610 Total Revenue$1,414,400 $1,442,604 $1,353,228 Passive Components We manufacture and resell a full line of multi-layered ceramic and solid tantalum capacitors in many different sizes andconfigurations. Our strategic focus on the growing use of passive components is reflected in our investment of approximately $73million in facilities and equipment used to manufacture passive components during the past three fiscal years. We also addedpassive component manufacturing capacity with the February 2013 acquisition of the Tantalum Components division of NichiconCorporation (“Asia Tantalum”) for $81.2 million. We believe that sales of passive components will continue to be among themost rapidly growing in the worldwide electronics market because technological advances have been constantly expanding thenumber and type of applications for these products. Tantalum and Ceramic components are commonly used in conjunction with integrated circuits and are best suited forapplications requiring low to medium capacitance values. Capacitance is the measure of the capacitor's ability to store electricenergy. Generally, ceramic capacitors are more cost-effective at lower capacitance values, and tantalum capacitors are more cost-effective at medium capacitance values. The net sales of tantalum and ceramic capacitors accounted for approximately 61% of ourpassive component net sales in fiscal 2015. 6 We also offer a line of advanced passive component products to fill the special needs of our customers. Our family of passivecomponents also includes film capacitors, high energy/voltage power capacitors, and varistors. Our advanced products engineerswork with some customers’ in-house technical staffs to design and manufacture customized products to meet the specifications ofparticular applications. The manufacture of custom products permits us, through our research and development activities, to maketechnological advances, provide customers with design solutions to fit their needs, gain a marketing inroad with customers withrespect to our complete product line, and, in some cases, develop products that can be sold to additional customers in the future.Sales of advanced products accounted for approximately 39% of passive component net sales in fiscal 2015. KED Resale We have a non-exclusive license to distribute and sell certain Kyocera-manufactured electronic component and connectorproducts to certain customers and in certain territories outside of Japan. Our distribution and sale of certain Kyocera productsbroadens our range of products and further facilitates our ability to offer “one-stop shopping” for our customers' electroniccomponents needs. The Kyocera KDP and KCD electronic components we sell include ceramic capacitors, RF modules,frequency control devices, SAW devices, sensor products, actuators, and acoustic devices. Resale product sales also includeconnectors manufactured by Kyocera. Sales of these products accounted for approximately 22% of net sales in fiscal 2015. Foradditional information regarding the Company’s relationship with Kyocera see “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations – Relationship with Kyocera and Related Transactions.” Interconnect We manufacture and resell high-quality electronic connectors and interconnect systems for use in various industries. Ourproduct lines include a variety of industry-standard connectors as well as products designed specifically for our customers' uniqueapplications. An expanding portion of the electronics market for AVX Interconnect products is the automotive market, withapplications throughout a vehicle, including engine control, transmission control, audio, brakes, and stability and safety controlsystems. We produce fine pitch connectors used in portable devices such as smart phones, other cell phones, notebookcomputers, tablets, GPS, and other hand held devices. In addition, we offer specialty connectors designed to address customerspecific applications across a wide range of products and end markets, including the expanding LED and LCD markets. We haveinvested approximately $21 million in facilities, tooling, and equipment over the past three years, as we continue to focus on newproduct development and enhancement of production capabilities for our Interconnect business. Sales of Interconnect products,including KCP Resale connector products, accounted for approximately 15% of net sales in fiscal 2015. Approximately 34% ofcombined Interconnect and KCP Resale Connector net sales in fiscal 2015 consisted of connectors manufactured byKyocera. Kyocera notified AVX in February, 2014 of its intent, effective April 1, 2015 to market its connector products in Asiausing Kyocera’s sales force rather than continuing to have AVX resell such products in Asia. Sales of Kyocera connector productsin Asia were $47.5 million and $43.9 million for the fiscal years ended March 31, 2015 and March 31, 2014, respectively. Marketing, Sales, and Distribution We place a high priority on solving customers’ electronic component design challenges and responding to their needs. Tobetter serve our customers we frequently designate teams consisting of marketing, field application engineering, research anddevelopment, and manufacturing personnel to work with customers to design and manufacture products to suit their specificrequirements. Costs related to these activities are expensed as incurred. Approximately 30%, 29%, and 41% of our net sales for fiscal 2015 were to our customers in the Americas, Europe, and Asia,respectively. Financial information for these geographic regions is set forth in Note 15 to our consolidated financial statementselsewhere herein. A discussion of risks associated with our foreign operations can be found in “Risk Factors” herein. Our products are marketed worldwide by our own dedicated direct sales personnel that serve our major OEM and EMScustomers. We also have a large network of independent electronic component distributors and independent manufacturers’representatives who sell our products throughout the world. We have regional sales and design application personnel in strategiclocations to provide technical and sales support for these independent manufacturers’ representatives and independent electroniccomponent distributors. We believe that this combination of sales channels provides a high level of market penetration andefficient coverage of our customers on a cost-effective basis. 7 Our products are used in a wide variety of applications by numerous customers. In order to maximize our opportunities, ourengineering and sales teams maintain close relationships with OEM, EMS, and electronic component distributor customers. Ourlargest customers may vary from year to year, and no customer has a long-term commitment to purchase our products. Duringthe fiscal years ended March 31, 2015 and March 31, 2014, no single customer accounted for more than 10% of our sales. Onecustomer comprised 13% of sales for the fiscal year ended March 31, 2013. As of March 31, 2015 and March 31, 2014, onecustomer represented 15% of the Company’s accounts receivable balance. Because we are a supplier to several significantmanufacturers in the broad based electronic devices industries and because of the cyclical nature of these industries, thesignificance of any one customer can vary from one period to the next. We also have qualified products under various specifications approved and monitored by the United States DefenseElectronic Supply Center (“DSCC”) and European Space Agency (“ESA”), and approved under certain foreign militaryspecifications. Typically, independent electronic component distributors handle a wide variety of products and fill orders for manycustomers. The sales terms under non-exclusive agreements with independent electronic component distributors may vary bydistributor, and by geographic region. In the United States, Europe, and Asia, such agreements may include stock rotation andship-from-stock and debit (“ship and debit”) programs. Stock rotation is a program whereby distributors are allowed to returnfor credit qualified inventory, semi-annually, equal to a certain percentage, primarily limited to 5%, of the previous six months netsales. In the United States, we may use a ship and debit program under which pricing adjustments may be granted by us to assistdistributors in meeting competitive prices in the marketplace on sales to their end customers. Ship and debit programs require arequest from the distributor for a pricing adjustment for a specific part for a sale to the distributor’s end customer from thedistributor’s stock. In addition, certain agreements with distributors may include special incentive discounts based on amount ofproduct ordered or shipped. Our agreements with independent electronic component distributors generally also require that werepurchase qualified inventory from the distributor in the event that we terminate the distributor agreement or discontinue aproduct offering. We had a backlog of orders of approximately $247 million at March 31, 2013, $270 million at March 31, 2014 and $228million at March 31, 2015. Firm orders, primarily with delivery dates within six months of order placement, are included inbacklog. Many of our customers encounter uncertain and changing demand for their products. Customer provided forecasts ofproduct usage and anticipated usage of inventory at consignment locations are not included in backlog. If demand falls belowcustomers’ forecasts, or if customers do not effectively control their inventory, they may cancel or reschedule their plannedshipments that are included in our backlog, in many instances without any penalty. Backlog fluctuates from year to year due, inpart, to changes in customer inventory levels, changes to consignment inventory arrangements, order patterns, and productdelivery lead times in the industry. Accordingly, the backlog outstanding at any point in time is not necessarily indicative of thelevel of business to be expected in any ensuing period since many orders are placed and delivered within the same period. Inaddition, the increased use of vendor managed inventory and similar consignment type arrangements tend to limit the significanceof backlog as future use and sale of such inventory is not typically reflected in backlog. Research, Development, and Engineering Our emphasis on research and development is evidenced by the fact that most of our manufactured products andmanufacturing processes have been designed and developed by our own engineers and scientists. Our research and developmentactivities are carried out at facilities located in the United States, United Kingdom, Czech Republic, France, Israel, Malaysia, andJapan. Our research and development effort and our operational level engineering effort place a priority on the design anddevelopment of product extensions, innovative new products and improved manufacturing processes as well as engineeringadvances in existing product lines and manufacturing operations. Other areas of emphasis include material synthesis and theintegration of passive components for applications requiring reduced size and lower manufacturing costs associated with boardassembly. Research, development, and engineering expenditures were approximately $30 million, $26 million, and $25 millionduring fiscal 2013, 2014, and 2015, respectively. The level of such spending can fluctuate as new products are transferred to fullscale production and process enhancements are implemented. 8 We own United States patents as well as corresponding patents in various other countries, and also have patent applicationspending, although patents are not in the aggregate material to the successful operation of our business. For discussion regardingour license arrangement with Kyocera, see “Management’s Discussion and Analysis of Financial Condition and Results ofOperations – Relationship with Kyocera and Related Transactions.” Raw Materials The costs of our products are influenced by a wide variety of raw materials, including tantalum and other metals such asplatinum, palladium, silver, nickel, gold, and copper used in our manufacturing processes. The cost of these materials is subject toprice fluctuation. In some cases, increases in the cost of raw materials may be offset by selling price increases, productivityimprovement, and cost savings programs, but that is not always the case. We are a major consumer of the world’s annual production of tantalum. Tantalum powder and wire are principal materialsused in the manufacture of tantalum capacitor products. These materials are purchased from suppliers in various parts of theworld at prices that are subject to periodic adjustment and variations in the market. The tantalum required to manufacture ourproducts has generally been available in sufficient quantity. The limited number of tantalum material suppliers that processtantalum ore into capacitor grade tantalum powder has led to higher prices during periods of increased demand and/or limitedmining output. Although most materials incorporated in our products are available from a number of sources, certain materials are availableonly from a relatively limited number of suppliers. For the ten years prior to our participation in “Solutions for Hope”, we had apolicy of not using tantalum sourced from the Democratic Republic of Congo (“DRC”) or any other area in which insurgents orsimilar groups benefit from the sale of minerals. We have conducted extensive supply chain investigations relating to tantalum andare a participant in “Solutions for Hope”, which is a program designed to ensure that tantalum sourced from the DRC does notderive from conflict areas. “Solutions for Hope” incorporates the independently-validated Conflict-Free Smelter program. As aresult, AVX was the first in its industry to validate a “closed tantalum pipe” process, assuring all tantalum products contain onlytantalum from smelters that have been independently-validated under the Conflict-Free Smelter program in accordance with theprinciples of the Dodd-Frank legislation and the current Organisation for Economic Cooperation and Development (“OECD”)guidelines. Since December 2011, AVX has only sourced tantalum powder and wire used in its tantalum capacitors from smelters that arecompliant with the EICC/GeSI conflict-free smelter program. In 2012, AVX began using Validated Conflict-Free Tantalum,which comes from verified sources in the DRC and surrounding countries. Our participation in “Solutions for Hope” is intended to affirm our commitment to supply conflict-free minerals to ourcustomers and to fully comply with the OECD guidelines and United States Securities and Exchange Commission (“SEC”)regulations. Some of our major OEM customers and automotive suppliers have joined us in the “Solutions for Hope” project. Competition Markets for our products are highly competitive. We encounter aggressive and able competition in our various product linesfrom both domestic and foreign manufacturers. Competitive factors in the markets include product quality and reliability, breadthof product line, customer service, technological innovation, global production presence, timely delivery, and price. We believe weare competitively positioned on each of these factors. The breadth of our product offering enables us to strengthen our marketposition by providing customers with one of the broadest selections of passive electronic components and interconnect productsavailable from any one source. Our major competitors for passive electronic components include: Murata ManufacturingCompany Ltd., TDK Corporation, Kemet Corporation, Yageo Corporation, Taiyo Yuden Co. Ltd., Samsung Electro-Mechanics, and Vishay Intertechnology, Inc. Our major competitors for certain electronic interconnect products include: TEConnecting, Amphenol Corporation, Molex Incorporated, FCI Electronics, and Ernt Electronics. There are many othercompanies that produce products in the markets in which we compete. 9 Employees As of March 31, 2015, we employed approximately 10,400 full-time employees. Approximately 1,400 of these employees areemployed in the United States, of which, approximately 300 are covered by collective-bargaining arrangements. In addition, someforeign employees are members of trade and government-affiliated unions. Our relationship with our employee union groups isgenerally good. However, no assurance can be given that, in response to changing social and economic conditions and ouractions, labor unrest or strikes will not occur. Environmental Matters We are subject to federal, state, and local laws and regulations concerning the environment in the United States and to theenvironmental laws and regulations of the other countries in which we operate. These regulations include limitations on dischargesinto air and water; remediation requirements; chemical use and handling restrictions; pollution control requirements; wasteminimization considerations; and hazardous materials transportation, treatment, and disposal restrictions. If we fail to comply withany of the applicable environmental regulations we may be subject to fines, suspension of production, alteration of ourmanufacturing processes, sales limitations, and criminal and civil liabilities. Existing or future regulations could require us to procureexpensive pollution abatement or remediation equipment, to modify product designs, or to incur expenses to comply withenvironmental regulations. Any failure to control the use, disposal, or storage, or adequately restrict the discharge of hazardoussubstances could subject us to future liabilities and could have a material adverse effect on our business. Based on our periodicreviews of the operating policies and practices at all of our facilities, we believe that our operations are currently in substantialcompliance, in all material respects, with all applicable environmental laws and regulations and that the cost of continuingcompliance will not have a material effect on our financial condition or results of operations. We have been identified by the United States Environmental Protection Agency (“EPA”), state governmental agencies orother private parties as a potentially responsible party (“PRP”) under the Comprehensive Environmental Response,Compensation and Liability Act (“CERCLA”) or equivalent state or local laws for clean-up and response costs associated withcertain sites at which remediation is required with respect to prior contamination. Because CERCLA or such state statutesauthorize joint and several liability, the EPA or state regulatory authorities could seek to recover all clean-up costs from any one ofthe PRPs at a site despite the involvement of other PRPs. At certain sites, financially responsible PRPs other than AVX also are, orhave been, involved in site investigation and clean-up activities. We believe that liability resulting from these sites will beapportioned between AVX and other PRPs. To resolve our liability at the sites at which we have been named a PRP, we have entered into various administrative ordersand consent decrees with federal and state regulatory agencies governing the timing and nature of investigation andremediation. As is customary, the orders and decrees regarding sites where the PRPs are not themselves implementing the chosenremedy contain provisions allowing the EPA to reopen the agreement and seek additional amounts from settling PRPs in theevent that certain contingencies occur, such as the discovery of significant new information about site conditions. On October 10, 2012, the EPA, the United States, and the Commonwealth of Massachusetts (the “Commonwealth”) andAVX announced that they had reached a financial settlement with respect to the EPA’s ongoing clean-up of the New BedfordHarbor in the Commonwealth (the “harbor”). That agreement is contained in a Supplemental Consent Decree that modifiescertain provisions of a 1992 Consent Decree regarding clean-up of the harbor, including elimination of the governments’ rightto invoke certain clean-up reopener provisions in the 1992 Consent Decree in the future. Under the terms of the settlement,AVX was obligated to pay $366.3 million, plus interest computed from August 1, 2012, in three installments over a two-yearperiod for use by the EPA and the Commonwealth to complete the clean-up of the harbor. The settlement also required theEPA to withdraw the the Unilateral Administrative Order (the “UAO”) that was issued on April 18, 2012 regarding additionalharbor clean-up activities. The United States District Court approved the settlement and entered the Supplemental ConsentDecree on September 19, 2013. On October 18, 2013, we paid the initial settlement installment of $133.4 million, plus accruedinterest of $4.0 million. On March 26, 2014, we prepaid a second settlement installment of $110.8 million, plus accrued interest of$0.8 million on the remaining settlement amount through that date. In accordance with the terms of the settlement, we areobligated to pay the remaining balance of $122.1 million, plus interest, on September 21, 2015. We have the option to prepay anyportion of the remaining settlement balance at any time prior to the due date.10  Also, on June 3, 2010, AVX entered into an agreement with the EPA and the City of New Bedford, pursuant to which AVXis required to perform environmental remediation at a site referred to as the “Aerovox Site” (the “Site”), located in New Bedford,Massachusetts. AVX has substantially completed its obligations pursuant to such agreement with the EPA and the City of NewBedford with respect to the satisfaction of AVX’s federal law requirements. Agreements with the state regulatory authorities haveyet to be concluded but are likely to include additional groundwater remediation. We have a remaining accrual of $11.8 million atMarch 31, 2015, representing our estimate of the potential liability related to the remaining performance of environmentalremediation actions at the Site using certain assumptions regarding the plan of remediation. Since additional sampling and analysismay cause the state regulatory authority, the Massachusetts Department of Environmental Protection, to require a more extensiveand costly plan of remediation, until all parties agree and remediation is complete, we cannot be certain there will be no additionalcost relating to the Site. We had total reserves of approximately $135.3 million and $138.1 million at March 31, 2014 and 2015, respectively, related tothe various environmental matters. These reserves are classified in the Consolidated Balance Sheets as $4.4 million and $127.2million in accrued expenses at March 31, 2014 and 2015, respectively, and $131.0 million and $10.9 million in other non-currentliabilities at March 31, 2014 and March 31, 2015, respectively. The amounts recorded for identified contingent liabilities are basedon estimates. Amounts recorded are reviewed periodically and adjusted to reflect additional legal and technical information thatbecomes available. Also, uncertainties about the status of laws, regulations, regulatory actions, technology, and information relatedto individual sites make it difficult to develop an estimate of the reasonably possible aggregate environmental remediationexposure. Accordingly, these costs could differ from our current estimates. We also operate on other sites that may have potential future environmental issues as a result of activities at sites during AVX’slong history of manufacturing operations or prior to the start of operations by AVX. Even though we may have rights ofindemnity for such environmental matters at certain sites, regulatory agencies in those jurisdictions may require us to address suchissues. Once it becomes probable that we will incur costs in connection with remediation of a site and such costs can bereasonably estimated, we establish reserves or adjust our reserves for our projected share of these costs. A separate accountreceivable is recorded for any indemnified costs. Our environmental reserves are not discounted and do not reflect any possiblefuture insurance recoveries, which are not expected to be significant, but do reflect a reasonable estimate of cost sharing atmultiple party sites or indemnification of our liability by a third party. On November 27, 2007, a suit was filed in South Carolina State Court by individuals as a class action with respect to propertyadjacent to our Myrtle Beach, South Carolina factory claiming property values were negatively impacted by alleged migration ofcertain pollutants from our property. The parties agreed to a $1.2 million settlement of the action, which was approved by theCourt on December 15, 2014 and paid in January 2015. An appeal of one aspect of that class action is still pending before theSouth Carolina Supreme Court; if resolved against AVX, it may result in additional litigation. On March 1, 2010, AVX was named as a third party defendant in a case filed in Massachusetts Superior Court captionedDaRosa v. City of New Bedford. This case relates to a former disposal site in the City of New Bedford located at Parker Street. TheCity asserts that a predecessor company, Aerovox, among others, contributed to contamination at that site. AVX believes it hasmeritorious defenses and intends to vigorously defend the case. On October 16, 2014, a case was filed against AVX in Massachusetts Superior Court by the City of New Bedford arisingfrom contamination at the City’s New Bedford Railyard. AVX had previously received a formal demand from the City in theamount of approximately $11.0 million related to activities by Aerovox. AVX believes it has meritorious defenses and intends tovigorously defend the case. We are not involved in any pending or threatened proceedings that would require curtailment of our operations. Wecontinually expend funds to ensure that our facilities comply with applicable environmental regulations. While we believe that weare in material compliance with applicable environmental laws, we cannot accurately predict future developments and do notnecessarily have knowledge of all past occurrences on sites that we currently occupy. More stringent environmental regulationsmay be enacted in the future and we cannot determine the modifications, if any, in our operations that any such future regulationsmight require, or the cost of compliance with such regulations. Moreover, the risk of environmental liability and remediation costsis inherent in the nature of our business and, therefore, there can be no assurance that material environmental costs, includingremediation costs, will not arise in the future. 11 Company Information and Website We file annual, quarterly, and current reports, proxy statements, and other documents with the SEC under the SecuritiesExchange Act of 1934 (the “Exchange Act”). The public may read and copy any materials that we file with the SEC at the SEC’sPublic Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of thePublic Reference Room by calling the SEC at 1-800-SEC-0330. Also, the SEC maintains an Internet website that contains reports,proxy and information statements, and other information regarding issuers, including us, that file electronically with the SEC. Thepublic can obtain any documents that we file with the SEC at http://www.sec.gov. In addition, our Company website can be found on the Internet at www.avx.com. Copies of each of our filings with the SECon Form 10-K, Form 10-Q, and Form 8-K, and all amendments to those reports, can be viewed and downloaded free of chargeas soon as reasonably practicable after the reports and amendments are electronically filed with or furnished to the SEC. To viewthe reports from our website, go to “Corporate Information”, then “Investor Relations”, then “Financial Reports”. The following corporate governance related documents are also available free on our website: ·Code of Business Conduct and Ethics·Code of Business Conduct and Ethics Supplement Applicable to the Chief Executive Officer, Chief Financial Officer,Controllers and Financial Managers·Corporate Governance Guidelines·Audit Committee Charter·Compensation Committee Charter·Special Advisory Committee Charter·Contact the Board – Whistleblower and Ethics Hotline Procedures To review these documents, go to our website, click on “Corporate Information”, then on click “Corporate Governance”. Executive Officers of the Registrant Our executive officers are appointed annually by our Board of Directors or, in some cases, appointed in accordance with ourbylaws and each officer holds office until the next annual appointment of officers or until a successor has been duly appointedand qualified, or until the officer’s death or resignation, or until the officer has otherwise been removed in accordance with ourbylaws. The following table provides certain information regarding the current executive officers of the Company: NameAgePositionJohn Sarvis...........................65 Chief Executive Officer and PresidentJohn Lawing......................... 64 Vice President, Chief Technology OfficerKurt P. Cummings................. 59 Vice President, Chief Financial Officer, Treasurer andSecretaryKathleen M. Kelly................. 61 Vice President of Human ResourcesKeith Thomas....................... 60 Vice President, President of Kyocera ElectronicDevicesPeter Venuto......................... 62 Vice President of Sales John Sarvis Chief Executive Officer and President since April 2015. Vice President of Ceramic Products since 2005. Divisional Vice President– Ceramics Division from 1998 to 2005. Prior to 1998, held various Marketing and Operational positions. Employed by theCompany since 1973. John Lawing Vice President, Chief Technology Officer since April 2014. President and Chief Operating Officer from 2013 to March 2014.Vice President of Advanced Products from 2005 to April 2013. Divisional Vice President of Advanced Products from 2002 to2005 and Divisional Vice President of Leaded Products from 1997 to 2002. Prior to 1997, held positions in Engineering,Technical, Operational, and Plant management. Employed by the Company since 1981. 12 Kurt P. Cummings Vice President, Chief Financial Officer, and Treasurer since 2000. Secretary since 1997. Corporate Controller from 1992 to 2000.Prior to 1992, Partner with Deloitte & Touche LLP. Kathleen M. Kelly Vice President of Human Resources since 2010. Prior to the acquisition of American Technical Ceramics by the Company in2007, served as Vice President – Administration and as Corporate Secretary of American Technical Ceramics from November,1989. Keith Thomas Vice President since 2001. President of Kyocera Electronic Devices since 2004. Vice President of Kyocera Developed Productsfrom 2001 to 2004. Divisional Vice President of Kyocera Developed Products from 1992 until 2001. Employed by the Companysince 1980. Peter Venuto Vice President of Sales since 2009. Vice President of North American and European Sales from 2004 to 2009. Vice President ofNorth American Sales from 2001 to 2004. Divisional Vice President of Strategic Accounts from 1998 until 2000. Director ofStrategic Accounts from 1990 until 1997. Director of Business Development from 1987 until 1989. Employed by the Companysince 1987. Item 1A.Risk Factors From time to time, information provided by us, including, but not limited to, statements in this report, or other statementsmade by us or on our behalf, may contain “forward-looking” information within the meaning of the Private Securities LitigationReform Act of 1995. Such statements involve a number of risks, uncertainties, and contingencies, many of which are beyond ourcontrol, which may cause actual results, performance, or achievements to differ materially from those anticipated. Our businesses routinely encounter and address risks, some of which will cause our future results to be different – sometimesmaterially different – than we presently anticipate. Discussion about the important operational risks that our businesses encountercan also be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” includedelsewhere in this Form 10-K. We wish to caution the reader that the following important risk factors and those factors describedelsewhere in this report or other documents that we file or furnish to the SEC could cause our actual results to differ materiallyfrom those stated in forward-looking statements contained in this document and elsewhere. Below, we have described ourcurrent view of certain important strategic risks. These risks are not presented in order of importance or probability of occurrence.Our reactions to material future developments as well as our competitors’ reactions to those developments will impact our futureresults. We operate in a cyclical business, which could result in significant fluctuations in demand for our products Cyclical changes in our customers’ businesses have resulted in, and may in the future result in, significant fluctuations indemand for our products, selling prices, and our resulting profitability. Most of our customers operate in cyclical industries. Theirrequirements for passive components and interconnect products fluctuate significantly as a result of changes in general economicconditions and other factors. During periods of increasing demand they typically seek to increase their inventory of our productsto avoid production bottlenecks. When demand for their products peaks and begins to decline, as has happened in the past, theytend to reduce or cancel orders for our products while they use up accumulated inventory. Business cycles vary somewhat indifferent geographical regions and customer industries. Significant fluctuations in sales of our products impact our unitmanufacturing costs and impact our profitability by making it more difficult for us to predict our production, raw materials, andshipping needs. Changes in demand mix, needed technologies, and end-use markets may adversely affect our ability to match ourproducts, inventory, and capacity to meet customer demand and could adversely affect our operating results and financialcondition. We are also vulnerable to general economic events or trends beyond our control, and our sales and profits may sufferin periods of weak demand. 13 We must consistently reduce costs to remain competitive and to combat downward price trends To remain competitive and to combat the impact of potential downward price trends we must consistently reduce the totalcosts of our products. Our industry is intensely competitive, and prices for existing products tend to decrease over their life cycle.To remain competitive, we must achieve continuous cost reductions through process and material improvements. We must alsobe in a position to minimize our customers’ inventory financing costs and to meet their other goals for supply chain management.In addition, as a result of our efforts to streamline manufacturing and logistics operations and to enhance operations in lower costregions, we have incurred restructuring costs in the past and could incur restructuring costs in the future in response to changes inglobal economic and market conditions. If we are unsuccessful in implementing restructuring or other cost reduction plans, wemay experience disruptions in our operations and incur higher ongoing costs, which may adversely affect our business, financialcondition, and operating results. We attempt to improve profitability by operating in countries in which manufacturing costs are lower; but the shift ofoperations to these regions may entail considerable expense Our strategy is aimed at achieving significant production cost savings through the transfer to and expansion of manufacturingoperations in countries with lower productions costs, such as the Czech Republic, Malaysia, Mexico, China, and El Salvador.During this process, we may experience under-utilization of certain plants and factories in higher-cost regions and capacityconstraints in plants and factories located in lower-cost regions. This under-utilization may result initially in productioninefficiencies and higher costs. These costs also include those associated with compensation in connection with work forcereductions and plant closings in the higher-cost regions, and start-up expenses, equipment relocation costs, manufacturing andconstruction delays, and increased depreciation costs in connection with the initiation or expansion of production in lower-costregions. In addition, as we implement transfers of certain of our operations, we may experience labor strikes or other types ofdisruption as a result of lay-offs or termination of our employees in higher-cost countries. Due to our global operations, we are subject to many laws governing international relations (including but not limited to theForeign Corrupt Practices Act and the U.S. Export Administration Act), which prohibit improper payments to governmentofficials and restrict where and how we can do business, what information or products we can supply to certain countries, andwhat information we can provide to a non-U.S. government. Although we have procedures and policies in place that shouldmitigate the risk of violations of these laws, there is no guarantee that they will be sufficiently effective. If and when we acquirenew businesses we may not be able to ensure that the pre-existing controls and procedures meant to prevent violations of therules and laws were effective and we may not be able to implement effective controls and procedures to prevent violations quicklyenough when integrating newly acquired businesses. We encounter competition in substantially all areas of our business We compete primarily on the basis of technology, product quality, price, sales terms, customer service, and deliverytime. Competitors include large, diversified companies, some of which have substantial assets and financial resources, as well asmedium to small companies. There can be no assurance that additional competitors will not enter into our existing markets, norcan there be any assurance that we will be able to compete successfully against existing or new competition. 14 We must continue to develop new products to remain competitive Most of the fundamental technologies used in the passive components industry have been available for a long time. Themarket is nonetheless typified by rapid changes in product designs and technological advantages allowing for better performanceand/or lower cost. New applications are frequently found for existing technologies, and new technologies occasionally replaceexisting technologies for some applications or open up new business opportunities in other areas of application. Successfulinnovation is critical for maintaining profitability in the face of potential erosion of selling prices for existing products. To combatdownward selling price pressure for our products and to meet market requirements, we must continue to develop innovativeproducts and production techniques. Sustaining and improving our profitability depends a great deal on our ability to developnew products quickly and successfully meet customer specifications. Non-customized commodity products are especiallyvulnerable to price pressure, but customized products have also experienced price pressure in recent years. We have traditionallycombated downward pricing trends in part by offering products with new technologies or applications that offer our customersadvantages over older products. We also seek to maintain profitability by developing products to our customers’ specifications thatare not readily available from competitors. Developing and marketing these products requires start-up costs that may not berecouped if those new products or production techniques are not successful. There are numerous risks inherent in this process,including the risks that we will be unable to anticipate the direction of technological change or that we will be unable to developand market new products and applications in a timely fashion to satisfy customer demands. If this occurs, we could lose customersand experience adverse effects on our results of operations.Our operating results are sensitive to raw material and resale product availability, quality, and cost Many of our products require the use of raw materials that are available from only a limited number of regions around theworld, are available from only a limited number of suppliers, or may be subject to significant fluctuations in market prices. Ourresults of operations may be adversely affected if we have difficulty obtaining these raw materials, our key suppliers experiencefinancial difficulties, the quality of available raw materials deteriorates, or there are significant price increases for these raw materials.For example, the prices for tantalum, platinum, silver, nickel, gold, copper, palladium, and other raw materials that we use in themanufacture of our products are subject to fluctuation and have experienced significant variability in the past. Our inability torecover costs through increased sales prices could have an adverse impact on our results of operations. For periods in which theprices for these raw materials rise, we may be unable to pass on the increased cost to our customers, which would result indecreased margins for the products in which they are used. For periods in which margins are declining, we may be required, ashas occurred in the past, to write down our inventory carrying cost of these raw materials. Depending on the extent of thedifference between market price and our carrying cost, the write-down could have an adverse effect on our results of operations. From time to time there have been short-term market shortages of raw materials. While these shortages have not historicallyadversely affected our ability to increase production of products, they have historically resulted in higher raw material costs for us.There can be no assurance that any of these market shortages in the future would not adversely affect our ability to increaseproduction, particularly during periods of growing demand for our products. We resell products manufactured by Kyocera, as well as other component and interconnect product manufacturers. Shouldthese manufacturers experience difficulties in supplying the products that we resell, or such suppliers use other channels to markettheir products, we could experience lower sales which could have an adverse effect on our results of operations. Our sales to distribution sales channel customers may fluctuate Selling products to our customers in the electronic component distribution sales channel has associated risks, including,without limitation, that sales can be negatively impacted on a short-term basis as a result of changes in distributor inventory levels;these changes may be unrelated to the purchasing trends by the end customer. In the past, we have gone through cycles ofinventory correction as distributors increase or decrease their supply chain inventories based upon their anticipated market needsand economic conditions. 15 Our backlog is subject to customer cancellation We generally do not obtain firm, long-term purchase commitments from our customers. Uncertain economic andgeopolitical conditions have resulted in, and may continue to result in, some of our customers delaying the delivery of productsthat we manufacture for them and placing purchase orders for lower volumes of products than previously anticipated. Many ofthe orders that comprise our backlog may be canceled by our customers without penalty. Our customers may, on occasion, ordercomponents from multiple sources to ensure timely delivery when delivery lead times are particularly long and product delivery is aconcern. They may cancel orders when business is weak and inventories are excessive, a situation that we have experienced duringperiods of economic slowdown. Therefore, we cannot be certain that the amount of our backlog does not exceed the level ofsales that will ultimately be made. Our results of operations could be adversely impacted if customers cancel a material portion oforders in our backlog. Our growth strategy may include growth through acquisitions, which may involve significant risks We may, from time to time, make strategic acquisitions of other companies or businesses as we believe such acquisitions canhelp to position us to take advantage of growth opportunities. Such acquisitions could introduce significant risks and uncertainties,including risks related to integrating the acquired businesses and achieving benefits from the acquisitions. More particularly, risksand uncertainties of an acquisition strategy could include: (1) difficulties in integrating newly-acquired businesses and operations inan efficient and effective manner; (2) challenges in achieving strategic objectives, cost savings, and other benefits from acquisitions;(3) risk that our markets do not evolve as anticipated and that the technologies acquired do not prove to be those needed to besuccessful in those markets; (4) potential loss of key employees of the acquired businesses; (5) risk of diverting the attention ofsenior management from our operations; (6) risks of entering new markets in which we have limited experience; (7) risksassociated with integrating financial reporting and internal control systems; (8) difficulties in expanding information technologysystems and other business processes to accommodate the acquired businesses; (9) future impairments of goodwill and otherintangible assets of an acquired business; and (10) liabilities for activities of the acquired businesses, including environmental, tax,and other known and unknown liabilities. Changes in our environmental liability and compliance obligations may adversely impact our operations or financialcondition Our manufacturing operations, products, and/or product packaging are subject to environmental laws and regulationsgoverning air emissions; wastewater discharges; the handling, disposal, and remediation of hazardous substances, wastes, andcertain chemicals used or generated in our manufacturing process; employee health and safety; labeling or other notifications withrespect to the content or other aspects of our processes, products, or packaging; restrictions on the use of certain materials in oron design aspects of our products or product packaging; and responsibility for disposal of products or product packaging. Wealso operate on sites that may have potential future environmental issues as a result of activities at sites during the long history ofmanufacturing operations of AVX or its corporate predecessor, or prior to the start of operations by AVX. Even though we mayhave rights of indemnity for such environmental matters at certain sites, regulatory agencies in those jurisdictions may require us toaddress such issues. We establish reserves for specifically identified potential environmental liabilities when the liabilities areprobable and can be reasonably estimated. Nevertheless, there can be no assurance we will not be obligated to addressenvironmental matters that could have an adverse impact on our operations or financial condition. In addition, more stringentenvironmental regulations may be enacted in the future, and we cannot presently determine the modifications, if any, in ouroperations that any such future regulations might require, or the cost of compliance with these regulations. In order to resolveliabilities at various sites, we have entered into various administrative orders and consent decrees, some of which may be, undercertain conditions, reopened or subject to renegotiation. See “Environmental Matters” in Item 1 elsewhere in this Form 10-K foradditional information. 16 Changes in regulatory compliance obligations may adversely impact our operations The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank” Act), signed into law on July 21,2010, includes Section 1502, which requires the SEC to adopt additional disclosure requirements related to the source of certain“conflict minerals” for issuers for which such “conflict minerals” are necessary to the functionality or production of a productmanufactured, or contracted to be manufactured, by that issuer. A final rule was issued by the SEC on August 22, 2012. Themetals covered by the rules are commonly referred to as “3TG” and include tin, tantalum, tungsten, and gold. We use many ofthese materials in our production processes. The rule requires companies to perform due diligence, disclose, and report whether ornot such minerals originate from the DRC and adjoining countries. The implementation of these new requirements couldadversely affect the sourcing, availability, and pricing of such minerals. In addition, we will incur additional costs to comply withthe disclosure requirements, including costs related to determining the source of any of the relevant minerals and metals used inour products. Global supply chains are complicated with multiple layers and suppliers between the mine and the final product. For the ten years prior to our participation in “Solutions for Hope”, we had a policy of not using tantalum sourced from theDRC or any other area in which insurgents or similar groups benefit from the sale of minerals. We have conducted extensivesupply chain investigations relating to tantalum and are a participant in “Solutions for Hope”, which is a program designed toensure that tantalum sourced from the DRC does not finance or benefit armed groups in the DRC or adjoiningcountries. “Solutions for Hope” incorporates the independently-validated Conflict-Free Smelter program. As a result, AVX wasthe first in its industry to validate a “closed tantalum pipe” process, assuring all tantalum products contain only tantalum fromsmelters that have been independently-verified under the Conflict Free Smelter program in accordance with the principles of theDodd-Frank legislation and the current OECD guidelines. Since December 2011, AVX has only sourced tantalum powder and wire used in its tantalum capacitors from smelters that arecompliant with the EICC/GeSI conflict-free smelter program. In 2012, AVX began using Validated Conflict-Free Tantalum,which comes from verified sources in the DRC and surrounding countries. Our participation in “Solutions for Hope” is intended to affirm our commitment to supply conflict-free minerals to ourcustomers and to fully comply with the OECD guidelines and SEC regulations. The implementation of Rule 1502 has not had amaterial adverse effect on our ability to source raw materials or manufacture products containing the “3TG” metals. We filed ourfirst Form SD with the SEC on May 28, 2014. We use significant amounts of electrical energy and processed ores in our production process. Although its status is uncertain,the Kyoto Protocol is an international agreement that purports to set binding targets for signatory industrialized countries forreducing greenhouse gas emissions. Further, a number of governments or governmental bodies have introduced or arecontemplating legislative and regulatory change in response to the potential impacts of climate change including pending U.S.legislation that, if enacted, would limit and reduce greenhouse gas emissions through a “cap and trade” system of allowances andcredits, among other provisions. There is also current and emerging regulation in other countries in which we or our customersoperate, such as the mandatory renewable energy target in Australia. Any significant, sustained increase in energy costs could resultin increases in our capital expenditures, operating expenses, and costs of important raw materials resulting in an adverse effect onour results of operations and financial condition. The potential physical impacts of climate change on the company’s operations are highly uncertain, and will be particular tothe geographic circumstances. These effects may adversely impact the cost, production, and financial performance of ouroperations. Our results may be negatively affected by foreign currency exchange rates We conduct business in several international currencies through our worldwide operations and, as a result, are subject toforeign exchange exposure due to changes in exchange rates of the various currencies. Volatility in exchange rates can positively ornegatively affect our sales, gross margins, and stockholder’s equity. In order to minimize the effects of movements in currencyexchange rates, we enter into forward exchange contracts to hedge external and intercompany foreign currency transactions. Inaddition, we attempt to minimize currency exposure risk by producing our products in the same country or region in which theproducts are sold, thereby generating revenues and incurring expenses in the same currency. There can be no assurance that ourapproach will be successful, especially in the event of a significant and sudden decline in the value of any of the internationalcurrencies of our worldwide operations. We do not engage in purchasing forward exchange contracts for speculative purposes. 17 Our operating results may be adversely affected by foreign operations We have significant international operations and our operating results and financial condition could be adversely affected byeconomic, political, health, regulatory, and other circumstances existing in foreign countries in which we operate. Internationalmanufacturing and sales are subject to inherent risks, including production disruption by employee union or works councilactions, changes in local economic or political conditions, the imposition of currency exchange restrictions, unexpected changes inregulatory environments, potentially adverse tax law changes, and the exchange rate risk discussed above. Further, we haveoperations, suppliers, and customers in countries that are in the Pacific Basin which may be more susceptible to certain naturaldisasters, including earthquakes, tsunamis, and typhoons. Although we have operations around the world, a significant naturalevent could disrupt supply or production or significantly affect the market for some or all of our products. There can be noassurance that these factors will not have an adverse impact on our production capabilities or otherwise adversely affect ourbusiness and operating results. Our products are subject to stringent specifications and operating tolerances All of our products are built to specifications and tested by us for adherence to such specifications before shipment tocustomers. We warrant that our products will meet such specifications. In the past, we have not incurred significant warrantyclaims. However, we have seen an increasing trend in the marketplace for claims related to end market product application failuresor end-user recall or damage claims related to product defects, which could result in future claims that have an adverse impact onour results of operations. Fluctuations in the market values of our investment portfolio could adversely affect our financial condition andoperating results Although we have not recognized any material losses related to our cash equivalents, short-term investments, or long-terminvestments, future declines in the market values of such investments could have an adverse effect on our financial condition andoperating results. Given the global nature of our business, we have investments both domestically and internationally. Additionally,a portion of our overall investment portfolio includes investment securities in the financial sector. If the issuers of suchinvestments default on their obligations or their credit ratings are negatively impacted by liquidity, credit deterioration or losses,financial results, or other factors, the value of our cash equivalents, short-term investments, and long-term investments coulddecline and have an adverse effect on our financial condition and operating results. In addition, our ability to find investmentsthat are both safe and liquid and that provide a reasonable return may be impaired. This could result in lower interest incomeand/or higher other-than-temporary impairments. Credit risk on our accounts receivable could adversely affect our financial condition and operating results Our outstanding trade receivables are not covered by collateral or credit insurance. While we have procedures to monitor andlimit exposure to credit risk on our trade receivables, there can be no assurance such procedures will effectively limit our credit riskand avoid losses, which could have an adverse effect on our financial condition and operating results. Counterparty non-performance to derivative transactions could adversely affect our financial condition and operatingresults We evaluate the credit quality of potential counterparties to derivative transactions and only enter into agreements with thosedeemed to have minimal credit risk at the time the agreements are executed. Our foreign exchange hedge portfolio is diversifiedacross several credit line banks. We carefully monitor the amount of exposure we have with any given bank. We also periodicallymonitor changes to counterparty credit quality as well as our concentration of credit exposure to individual counterparties. Insome cases, we have master netting agreements that help reduce the risk of counterparty exposures. We do not hold or issuederivative financial instruments for trading or speculative purposes. Nevertheless, a credit crisis could have an impact on ourhedging contracts if our counterparties are forced to file for bankruptcy or are otherwise unable to perform their obligations. Ifwe are required to terminate hedging contracts prior to their scheduled settlement dates, we may be required to recognize losses. 18 Returns on pension and retirement plan assets and interest rate changes could affect our earnings in future periods The funding position of our pension plans is impacted by the performance of the financial markets, and the discount rateused to calculate our pension obligations for funding and expense purposes. In the past, declines in the financial markets havenegatively impacted the value of the assets in our defined benefit pension plans. In addition, lower bond yields may reduce ourdiscount rates, resulting in increased pension contributions and expense. Funding obligations are determined under government regulations and measured each year based on the value of the assetsand liabilities on a specific date. If the financial markets do not provide the long-term returns that are expected, we could berequired to make larger contributions. The financial markets can be, and in the recent past have been, very volatile, and thereforeour estimate of future contribution requirements can change in relatively short periods of time. In a low interest rate environment,the likelihood of higher contributions in the future increases. We may not generate sufficient future taxable income, which may require additional valuation allowances againstour deferred tax assets As part of the process of preparing our consolidated financial statements, we are required to estimate our tax assets andliabilities in each of the jurisdictions in which we operate. This process involves management estimating the actual current taxexposure together with assessing temporary differences resulting from different treatment of items for tax and accountingpurposes. These differences result in deferred tax assets and liabilities that are included within our consolidated balance sheets. Weassess the likelihood that our deferred tax assets will be recoverable as a result of future taxable income and, to the extent webelieve that recovery is not more likely than not, we establish a valuation allowance. We have recorded valuation allowances due to uncertainties related to our ability to realize some of our deferred tax assets,primarily consisting of certain net operating losses carried forward before they expire. The valuation allowances are based on ourestimates of future taxable income over the periods that our deferred tax assets will be recoverable. We also record a provision for certain international, federal, and state tax contingencies based on the likelihood of obligation,when needed. In the normal course of business, we are subject to challenges from U.S. and non-U.S. tax authorities regarding theamount of taxes due. These challenges may result in adjustments of the timing or amount of taxable income or deductions or theallocation of income among tax jurisdictions. Further, during the ordinary course of business, other changing facts andcircumstances may impact our ability to utilize tax benefits as well as the estimated taxes to be paid in future periods. In the eventthat actual results differ from our estimates, we may need to adjust tax accounts and related payments, which could materiallyimpact our financial condition and results of operations. If we are unable to generate sufficient future taxable income in certain jurisdictions, or if there is a significant change in theactual tax rates or the time period within which the underlying temporary differences become taxable or deductible, we could berequired to increase our valuation allowances against our deferred tax assets resulting in an increase in our effective tax rate and anadverse impact on future operating results. Liquidity requirements could necessitate transfers of existing cash balances between our subsidiaries which may besubject to restrictions or cause unfavorable tax or earnings consequences Approximately 72% of our cash and investment securities are held by international subsidiaries. While we intend to use cashheld overseas to fund our international operations and growth, if we encounter a significant need for liquidity domestically or at aparticular location that we cannot fulfill through other internal or external sources, we may experience unfavorable tax andearnings consequences due to cash transfers. These adverse consequences would occur, for example, if the transfer of cash intothe United States is taxed and no offsetting foreign tax credit is available to offset the U.S. tax liability, resulting in lower earnings. 19 We are increasingly dependent on information technology, and if we are unable to protect against service interruptions,data corruption, cyber-based attacks, or network security breaches, our operations could be disrupted We rely on information technology networks and systems, including the internet, to process, transmit, and store electronicand financial information; to manage a variety of business processes and activities; and to comply with regulatory, legal, and taxrequirements. We also depend on our information technology infrastructure for digital marketing and sales activities and forelectronic communications among our locations, personnel, customers, and suppliers around the world. Many of the informationtechnology systems used by the Company globally have been in place for many years and not all hardware and software iscurrently supported by vendors. These information technology systems are susceptible to damage, disruptions, or shutdowns dueto failures during the process of upgrading or replacing software, databases or components thereof, power outages, hardwarefailures, computer viruses, attacks by computer hackers, telecommunication failures, user errors, or catastrophic events. If ourinformation technology systems suffer severe damage, disruption, or shutdown and our business continuity plans do noteffectively resolve the issues in a timely manner, our product sales, financial condition, and results of operations may be materiallyand adversely affected, and we could experience delays in reporting our financial results. In addition, if we are unable to prevent security breaches, we may suffer financial and reputational damage or penaltiesbecause of the unauthorized disclosure of confidential information belonging to us or to our customers or suppliers. In addition,the disclosure of non-public sensitive information through external media channels could lead to the loss of intellectual propertyor damage our reputation and brand image. Changes in global geopolitical and general economic conditions and other factors beyond our control may adverselyimpact our business The following factors beyond our control could adversely impact our business: ·A global economic slowdown affecting any one, or all, of our markets. ·Rapid escalation of the cost of regulatory compliance and litigation. ·Unexpected government policies and regulations affecting us or our significant customers’ sales or production facilities. ·Unforeseen regional conflicts or actions, including, but not limited to, armed conflict and trade wars that could impactus or our customers’ production capabilities. ·Unforeseen interruptions to our business with our significant customers and suppliers resulting from labor strikes,financial instabilities, computer malfunctions, environmental disruptions, natural disasters, or inventory excesses or otherunforeseen events or circumstances. We operate in a continually changing business environment and new factors emerge from time to time. Other unknown andunpredictable factors also could have either adverse or positive effects on our future results of operations or financial condition. Item 1B.Unresolved Staff Comments None.20 Item 2.Properties Our fixed assets include certain plants and warehouses and a substantial quantity of machinery and equipment, most of whichis general purpose machinery and equipment, using tools and fixtures. In many instances the machinery and equipment haveautomatic control features and special adaptations. Our plants, warehouses, machinery, and equipment are in good operatingcondition and are well maintained. Substantially all of our facilities are in regular use. We consider the present level of fixed assets,along with planned capital expenditures, as suitable and adequate for our operations in the current business environment. Ourcapital expenditures for plant and equipment were $43.7 million in fiscal 2013, $26.8 million in fiscal 2014 and $26.6 million infiscal 2015. We believe that our facilities are suitable and adequate for the business conducted therein and are being appropriately utilizedfor their intended purposes. Utilization of the facilities varies based on demand for the products. We continuously review ouranticipated requirements for facilities and, based on that review, may from time to time acquire or lease additional facilities and/ordispose of existing facilities. We conduct manufacturing operations throughout the world. Most of our operations are certified to the ISO 9000 qualitystandard, a set of fundamental quality system standards developed by the International Organization for Standardization. Some ofour facilities are also qualified and registered under the more stringent QS 9000, a comprehensive quality system for continuousimprovement developed by the U.S. automotive industry. Virtually all of our manufacturing, research and development, and warehousing facilities could at any time be involved in themanufacturing, sale, or distribution of passive components (“PC”) and interconnect products (“CP”). The following is a list ofour facilities, their approximate square footage, whether they are leased or owned, and a description of their use. LocationApproximateSquareFootageType ofInterestDescriptionof UseUNITED STATESFountain Inn, SC340,000 OwnedHeadquarters/Manufacturing/Warehouse/Research –PCMyrtle Beach, SC163,000 OwnedManufacturing — PC Olean, NY113,000 Owned Manufacturing — PCJacksonville, FL100,000 Owned Manufacturing — PCHuntington Station, NY94,000 Owned Manufacturing/Research— PCBiddeford, ME72,000 Owned Manufacturing — PCConway, SC71,000 OwnedManufacturing — PC Sun Valley, CA25,000 Leased Manufacturing — PC NON U.S.Tianjin, China520,000 Owned Manufacturing — PC San Salvador, El Salvador420,000 Owned Manufacturing — PCSaint-Apollinaire, France322,000 Leased Manufacturing/Research — PC Lanskroun, CzechRepublic542,000 Owned Manufacturing/Warehouse/Research — PCLanskroun, CzechRepublic101,000 Leased Manufacturing/Warehouse — PCUherske Hradiste, CzechRepublic276,000 Owned Manufacturing — PCUherske Hradiste, CzechRepublic94,000 LeasedWarehouse — PCBzenec, Czech Republic194,000 OwnedManufacturing — CPPenang, Malaysia190,000 OwnedManufacturing/Research — PCColeraine, N. Ireland185,000 OwnedManufacturing/Research — PCBetzdorf, Germany111,000 OwnedManufacturing — CPJuarez, Mexico116,000 Owned Manufacturing — PC — CPJerusalem, Israel88,000 Leased Manufacturing/Research — PCAdogawa, Japan206,000 Owned Manufacturing/Research — PCHong Kong30,000 Owned Warehouse — PC — CPHong Kong21,000 Leased Warehouse/Office – PC – CP 21 In addition to the foregoing, we own and lease a number of sales offices throughout the world. In the opinion ofmanagement, our properties and equipment generally are in good operating condition and are adequate for our present needs.We do not anticipate difficulty in renewing existing leases as they expire or in finding alternative facilities if necessary. Item 3.Legal Proceedings See “Environmental Matters” in Item 1 elsewhere in this Form 10-K for a discussion of our involvement as a PRP atcertain environmental clean-up sites and certain pending lawsuits involving other environmental disputes. On April 25, 2013, AVX was named as a defendant in a patent infringement case filed in the United States District Court forthe District of Delaware captioned Greatbatch, Inc. v AVX Corporation. This case alleges that certain AVX products infringe on oneor more of six Greatbatch patents. AVX believes it has meritorious defenses and intends to vigorously defend the case. On September 2, 2014, a subsidiary of AVX, American Technical Ceramics (“ATC”), was named as a defendant in a patentinfringement case filed in the United States District Court for the District of Delaware captioned Presidio Components, Inc. v. AmericanTechnical Ceramics Corp. This case alleges that certain products of ATC’s infringe on a Presidio patent. AVX believes it hasmeritorious defenses and intends to vigorously defend the case. During the quarter ended September 30, 2014, AVX was named as a co-defendant in a series of cases filed in the UnitedStates and in the Canadian provinces of Quebec, Ontario and British Columbia alleging violations of United States, Canadian,and state antitrust laws asserting that AVX and numerous other companies are participants in alleged price-fixing in the capacitormarket. The cases in the United States were consolidated into the Northern District of California on October 2, 2014. During thequarter ended December 31, 2014, additional Canadian cases were filed in the provinces of Quebec, Ontario, British Columbia,Saskatchewan and Manitoba. These cases are at the very initial stages. AVX believes it has meritorious defenses and intends tovigorously defend the cases. We are involved in other disputes and legal proceedings arising in the normal course of business. While we cannot predict theoutcome of these proceedings, we believe, based upon a review with legal counsel, that none of these proceedings will have amaterial impact on our financial position, results of operations, comprehensive income (loss), or cash flows. However, we cannotbe certain of the eventual outcome, and any adverse result in these or other matters that may arise from time to time, may harmour financial position, results of operations, comprehensive income (loss), or cash flows. Item 4.Mine Safety Disclosures Not applicable. 22  PART II Item 5.Market for the Registrant’s Common Equity, Related Stockholder Matters andIssuer Purchases of Equity Securities Market for Common Stock Our common stock is listed on the New York Stock Exchange and trades under the symbol “AVX.” At May 11, 2015, therewere 311 holders of record of the Company's common stock. In addition, there were numerous beneficial holders of thecommon stock, representing persons whose stock is held in nominee or “street name” accounts through brokers. The followingtable presents the high and low sale prices for our common stock on the New York Stock Exchange and the dividends declaredper common share for each quarter for the fiscal years ended March 31, 2014 and March 31, 2015. On May 14, 2015, our Boardof Directors declared a $0.1050 dividend per share of common stock with respect to the quarter ended March 31, 2015. Futuredividends, if any, will be determined by the Company’s Board of Directors and may depend on the Company’s futureprofitability and anticipated operating cash requirements. Common Stock Price RangeDividends Declared 20142015Per Share HighLowHighLow20142015First Quarter$12.26 $11.16 $14.13 $13.89 $0.0875 $0.0950 Second Quarter13.51 12.04 13.90 13.77 0.0875 0.1050 Third Quarter14.09 12.90 14.95 14.73 0.0950 0.1050 Fourth Quarter13.76 12.57 15.15 14.95 0.0950 0.1050 The name, address, and phone number of our stock transfer agent and registrar is: The American Stock Transfer and Trust Company6201 15 AvenueBrooklyn, NY 112191-800-937-5449 Stock Performance Graph The following chart shows, from the end of fiscal year 2010 to the end of fiscal year 2015, changes in the value of $100invested in each of the Company’s common stock, Standard & Poor’s 500 Composite Index, and a peer group consisting ofthree companies whose businesses are representative of our business segments. The companies in the peer group are: KemetCorporation, Vishay Intertechnology, Inc., and Fairchild Semiconductor International, Inc. In fiscal year 2014, our peer groupincluded Kemet Corporation, Vishay Intertechnolocy, Inc. and International Rectifier Corp., however International RectifierCorp. has since delisted its shares from the New York Stock Exchange and is no longer a public company. We have addedFairchild Semiconductor International, Inc. as a new member of our peer group in place of International Rectifier Corp.23 th Cumulative Total Return 3/31/103/31/113/31/123/31/133/31/143/31/15AVX - NYSE$100 $106 $96 $89 $101 $113 S & P 500$100 $116 $126 $143 $174 $197 Peer Group$100 $189 $138 $138 $142 $155 Purchases of Equity Securities by the Issuer The following table provides information regarding purchases by the Company, during the fourth quarter ended March 31,2015, of equity securities that are registered pursuant to Section 12 of the Exchange Act:24  PeriodTotal Number ofShares Purchased(1)Average PricePaid Per ShareTotal Number ofShares Purchased asPart of PubliclyAnnounced Plans orPrograms (1)Maximum Number ofShares that may yet bePurchased Under the Plansor Programs (1)1/1/15 - 1/31/1520,000 $13.04 20,000 4,367,897 2/1/15 - 2/28/1585,900 13.51 85,900 4,281,997 3/1/15 - 3/31/1597,414 14.37 97,414 4,184,583 Total203,314 $13.88 203,314 4,184,583 (1)On October 17, 2007, the Board of Directors of the Company authorized the repurchase of 5,000,000 shares of ourcommon stock from time to time in the open market. The repurchased shares are held as treasury stock and areavailable for general corporate purposes. Item 6.Selected Financial Data The following table sets forth selected consolidated financial data for AVX for the five fiscal years ended March 31,2015. The selected consolidated financial data for the five fiscal years ended March 31, 2015 are derived from AVX’s auditedconsolidated financial statements. The consolidated financial data set forth below should be read in conjunction with AVX’sconsolidated financial statements and the notes thereto and “Management’s Discussion and Analysis of Financial Condition andResults of Operations” included elsewhere in this Form 10-K.25  Selected Financial Data(in thousands, except per share data) Fiscal Year Ended March 31, 20112012201320142015OPERATING RESULTS DATA:Net sales$1,653,176 $1,545,254 $1,414,400 $1,442,604 $1,353,228 Cost of sales1,195,790 1,153,295 1,150,630 1,163,770 1,024,659 Gross profit457,386 391,959 263,770 278,834 328,569 Selling, general and administrative expenses123,887 116,408 117,365 119,670 115,820 Environmental charges8,575 100,000 266,250 - -Profit (loss) from operations324,924 175,551 (119,845)159,164 212,749 Interest income6,569 6,798 7,021 4,899 4,554 Interest expense -(707)(2,262)(2,432)(978)Other, net2,766 (1,737)1,764 1,726 2,274 Income (loss) before income taxes334,259 179,905 (113,322)163,357 218,599 Provision for (benefit from) income taxes90,256 27,100 (49,010)36,320 (7,272)Net income (loss)$244,003 $152,805 $(64,312)$127,037 $225,871 Income (loss) per share:Basic$1.44 $0.90 $(0.38)$0.75 $1.34 Diluted$1.43 $0.90 $(0.38)$0.75 $1.34 Weighted average common shares outstanding:Basic170,025 169,886 169,124 168,473 168,148 Diluted170,390 170,134 169,124 168,658 168,402 Cash dividends declared per common share$0.19 $0.28 $0.31 $0.37 $0.41 As of March 31,20112012201320142015BALANCE SHEET DATA:Working capital$1,366,450 $1,430,072 $1,614,656 $1,606,789 $1,478,243 Total assets2,319,482 2,468,012 2,601,995 2,384,988 2,459,015 Stockholders' equity2,039,417 2,120,753 1,972,930 2,047,685 2,131,963 Fiscal Year Ended March 31, 20112012201320142015OTHER DATA:Capital expenditures$27,470 $49,201 $43,705 $26,805 $26,599 Research, development and engineering expenses23,683 26,328 30,467 26,240 25,390 26 Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview AVX Corporation is a leading worldwide manufacturer and supplier and reseller of a broad line of passive electroniccomponents and interconnect products. Electronic components and connector products manufactured or resold by AVX areused in virtually all types of electronic products, including those in telecommunications, automotive, transportation, energyharvesting, consumer electronics, military/aerospace, medical, computer, and industrial markets. We have five main productgroups: Ceramic Components, Tantalum Components, Advanced Components, Interconnect Products, and Kyocera ElectronicDevices. These product lines are organized into three reportable segments: Passive Components, Interconnect, and KED Resale. Consolidated revenues for the fiscal year ended March 31, 2015 were $1,353.2 million with net income of $225.9 millioncompared to consolidated revenues of $1,442.6 million with net incomes of $127.0 million for the fiscal year ended March 31,2014. During fiscal 2015, we saw an increase in operating results despite a drop in sales. Gross profit margins and operatingmargins improved year over year to 24.3% from 19.3% in the prior year. The strong financial results are primarily due ourattention to cost control and our focus on sales of value added advanced products and sales margins. In fiscal 2015, we generated $197.6 million of cash from operating activities. We used cash generated from operations tofund $13.6 million of general working capital requirements and $26.6 million of property and equipment purchases. In addition,to enhance shareholder value, we spent $7.2 million to repurchase shares of our common stock and paid increased dividends of$67.3 million during fiscal year 2015. Our financial position remains strong with $993.5 million of cash, cash equivalents, andsecurities investments and no borrowings as of March 31, 2015. We remain committed to investing in new products and improvements to our production processes as well as continuedinvestment in research, development, and engineering in order to provide our customers with new generations of passivecomponent and interconnect product solutions. We are currently producing more sophisticated electronic component partsnecessitated by the breadth and increase in functionality of the electronic devices and increased electronic content in products suchas smart phones, wearable electronic devices, tablets, ultrabooks, netbooks, automobiles, and renewable energy products that aremanufactured by our customers. As a result, we have continued our focus on value-added advanced products and interconnectsolutions to serve this expanding market. We are also focused on controlling and reducing costs to accommodate market forcesand offset rising costs of energy and materials. We do this by investing in automated manufacturing technologies, enhancingmanufacturing materials and efficiencies, and rationalizing our production capabilities around the world. We believe that thesestrategies will enable us to adapt quickly and benefit as market conditions change and provide shareholder value. In addition, we may, from time to time, consider strategic acquisitions of other companies or businesses in order to expandour product offerings or otherwise improve our market position. We evaluate potential acquisitions in order to position ourselvesto take advantage of profitable growth opportunities. Outlook Near-Term: With continuing uncertain global geopolitical and economic conditions, it is difficult to quantify expectations for fiscal2016. Near-term results for us will depend on the impact of the overall global geopolitical and economic conditions and theirimpact on telecommunications, information technology hardware, automotive, consumer electronics, and other electronicmarkets. Looking ahead, visibility is low and forecasting is a challenge in this uncertain and volatile market. We expect to seetypical pricing pressure in the markets we serve due to competitive activity. In response to anticipated market conditions, weexpect to continue to focus on cost management and product line rationalization to maximize earnings potential. We alsocontinue to focus on process improvements and enhanced production capabilities in conjunction with our focus on the sales ofvalue-added electronic components to support today’s advanced electronic devices. If current global geopolitical and economicconditions worsen, the overall impact on our customers as well as end user demand for electronic products could have asignificant adverse impact on our near-term results. Kyocera notified AVX in February, 2014 of its intent, effective April 1, 2015, to market its connector products in Asia usingKyocera’s sales force rather than continuing to have AVX resell such products in Asia. Sales of Kyocera connector products inAsia were $47.5 million and $43.9 million with operating profit of $1.9 million and $2.7 million for the fiscal years ended March27 31, 2015 and March 31, 2014, respectively. For more information regarding AVX’s relationship with Kyocera, see “Relationshipwith Kyocera and Related Transactions” below. Long-Term: Although there is uncertainty and caution in the near-term market as a result of the current global geopolitical and economicconditions, we continue to see opportunities for long-term growth and profitability improvement due to: (a) a projected increasein the long-term worldwide demand for more sophisticated electronic devices, which require electronic components such as theones we sell, (b) cost reductions and improvements in our production processes, and (c) opportunities for growth in ourAdvanced Component and Interconnect product lines due to advances in component design and our production capabilities. Wehave fostered our financial health and the strength of our balance sheet. We remain confident that our strategies will enable ourcontinued long-term success. Results of Operations Year Ended March 31, 2015 compared to Year Ended March 31, 2014 Net sales for the fiscal year ended March 31, 2015 were $1,353.2 million compared to $1,442.6 million for the fiscal yearended March 31, 2014. The table below represents product group revenues for the fiscal years ended March 31, 2013, 2014, and 2015. Fiscal Year Ended March 31,Sales revenue (in thousands)201320142015Ceramic Components$173,315 $193,978 $202,719 Tantalum Components330,209 394,119 355,974 Advanced Components346,543 357,900 359,315 Total Passive Components850,067 945,997 918,008 KDP and KCD Resale377,707 293,048 229,869 KCP Resale Connectors61,809 64,680 70,741 Total KED Resale439,516 357,728 300,610 Interconnect124,817 138,879 134,610 Total Revenue$1,414,400 $1,442,604 $1,353,228 Passive Component sales were $918.0 million for the fiscal year ended March 31, 2015 compared to $946.0 million during thefiscal year ended March 31, 2014. The sales decrease in Passive Components, specifically Tantalum Components, reflects overallmarket demand and our continued focus on the sale of value added and higher capacitance components with better marginopportunities. Lower sales is also reflective of our customer’s management of inventory levels in the current fiscal year and thenegative effects of currency exchange as the U.S. dollar strengthened against certain foreign currencies, primarily the Japanese yenand the euro. The increase in sales of Ceramic and Advanced Components reflects the demand in the automotive, computer,industrial and telecommunications equipment markets for more sophisticated electronic components across global markets. KDP and KCD Resale sales were $229.9 million for the fiscal year ended March 31, 2015 compared to $293.0 million duringthe fiscal year ended March 31, 2014. This decrease is primarily attributable to lower demand from, and inventory managementby, our cellular device customers as well as the unfavorable impact due to the strength of the U.S. dollar when compared to theJapanese yen. 28 Total connector sales, including AVX Interconnect products and KCP Resale Connectors, were $205.4 million in the fiscalyear ended March 31, 2015 compared to $203.6 million during the fiscal year ended March 31, 2014. This increase was primarilyattributable to an increased demand in the automotive sector reflective of the increased electronic content in today’s automobiles,partially offset by the negative impact on sales resulting from the strength of the U.S. dollar when compared to the Japanese yenand the euro. Kyocera notified AVX in February 2014 of its intent, effective April 1, 2015, to market its connector products inAsia using Kyocera’s sales force rather than continuing to have AVX resell such products in Asia. Sales of Kyocera connectorproducts in Asia were $47.5 million and $43.9 million with operating profit of $1.9 million and $2.7 million for the fiscal yearsended March 31, 2015 and March 31, 2014, respectively. Our sales to independent electronic distributors represented 45.7% of total net sales for the fiscal year ended March 31, 2015,compared to 42.1% for fiscal year ended March 31, 2014. Overall, distributor activity increased when compared to the sameperiod in the prior year reflective of their end customer demand improvements. Our sales to distributor customers may involvespecific ship and debit and stock rotation programs for which sales allowances are recorded as reductions in sales. Such allowancecharges decreased to $33.6 million, or 5.4% of gross sales to distributor customers, for the fiscal year ended March 31,2015 compared to $40.7 million, or 6.7% of gross sales to distributor customers, for the fiscal year ended March 31,2014, reflecting stable selling price conditions, primarily in the Americas, due to balanced supply. Applications under suchprograms for fiscal years ended March 31, 2015 and 2014 were approximately $34.4 million and $38.3 million, respectively. Geographically, compared to the prior fiscal year ended March 31, 2014, sales increased in the Americas and Europe whileAsia saw a decrease. The Asian market sales continued to reflect the lower KED Resale product sales in the telecommunicationsmarkets and the negative effect on sales primarily due to the strength of the U.S. dollar compared to the Japanese yen. Sales inAsia represented 41.6% of total sales while sales in the Americas increased to 29.7% and sales in Europe increased to 28.7% oftotal sales, respectively. This compares to 45.7%, 28.0%, and 26.3% of total sales for the Asian, American, and European regionsin the prior year, respectively. As a result of the strength of the U.S. dollar against certain foreign currencies, sales for the yearended March 31, 2015 were unfavorably impacted by approximately $28.1 million when compared to the prior year. Gross profit margin in the fiscal year ended March 31, 2015 increased to 24.3% of sales, or $328.6 million, compared to agross profit margin of 19.3% of sales, or $278.8 million, in the fiscal year ended March 31, 2014. This overall increase is primarilyattributable to our focus on the sale of value added and higher capacitance passive component sales with better marginopportunities and lower manufacturing and overhead costs due to our focus on cost control and manufacturing efficiencies.When compared to the prior fiscal year, costs were favorably impacted by approximately $37.3 million due to the strength of theU.S. dollar against certain foreign currencies. Selling, general, and administrative expenses for the fiscal year ended March 31, 2015 were $115.8 million, or 8.6% of netsales, compared to $119.7 million, or 8.3% of net sales, for the fiscal year ended March 31, 2014. The overall decrease in selling,general and administrative expenses reflects the impact of lower sales volumes and lower depreciation expense offset by higherprofessional fees for the fiscal year ended March 31, 2015 compared to the fiscal year ended March 31, 2014. Research, development, and engineering expenditures, which encompass the personnel and related expenses devoted todeveloping new products and maintaining existing products, processes, and technical innovations, were approximately $25.4million and $26.2 million in fiscal 2015 and 2014, respectively. Research and development costs included therein increased in fiscal2015 to $12.0 million compared to $10.5 million in fiscal 2014. Engineering expenses decreased $2.3 million to $13.4 million infiscal 2015 compared to $15.7 million in fiscal 2014 as we decreased activity related to production location moves when comparedto the prior year. Profit from operations for the fiscal year ended March 31, 2015 increased $53.6 million to $212.7 million compared to $159.2million for the fiscal year ended March 31, 2014. This increase is a result of the factors above. Other income increased $1.7 million to $5.9 million in fiscal 2015 compared to $4.2 million in fiscal 2014. This increase isprimarily attributable to higher interest income resulting from an increase in the overall average balance of our cash andinvestments during fiscal 2015 when compared to fiscal 2014.The tax rate for the fiscal year ended March 31, 2015 was a tax benefit of (3.3%) compared to a tax rate of 22.2% for thefiscal year ended March 31, 2014. The lower rate for fiscal 2015 is the result of net income tax benefits of $70.3 million primarilyattributable to the reversal of valuation allowances of $50.0 million related to the forecasted future utilization of net operating losscarryforwards (“NOL’s”) in our European operations and net tax benefits of $17.5 million primarily due to the U.S. tax benefitsrelated to the restructuring of foreign subsidiaries. Excluding such discrete items recorded during the fiscal year ended29 March 31, 2015, the effective tax rate would have been 28.9%. For fiscal 2014, the rate of 22.2% is primarily due to reserveadjustments due to the expiration of tax periods allowed for the audit of certain prior year income tax returns and adjustments ofapproximately $4.5 million related to prior period income tax accruals and estimates. Excluding such discrete items recordedduring the fiscal year ended March 31, 2014, the effective tax rate would have been 29.9%.The gross NOL’s related to the $50.0 million reversal of valuation allowances are $149.9 million. The related tax benefits uponutilization of the NOL’s are un-expiring, however they are subject to annual utilization limitations. The realization of tax benefitsdue to the utilization of these NOL’s could take an extended period of time to realize and are contingent upon the foreignsubsidiary’s continuing profitability.As a result of the factors discussed above, net income for the fiscal year ended March 31, 2015 was $225.9 million comparedto a $127.0 million for the fiscal year ended March 31, 2014. Year Ended March 31, 2014 Compared to Year Ended March 31, 2013 Net sales for the fiscal year ended March 31, 2014 were $1,442.6 million compared to $1,414.4 million for the fiscal yearended March 31, 2013. The table below represents product group revenues for the fiscal years ended March 31, 2012, 2013, and 2014. Fiscal Year Ended March 31,Sales revenue (in thousands)201220132014Ceramic Components$179,984 $173,315 $193,978 Tantalum Components393,468 330,209 394,119 Advanced Components378,843 346,543 357,900 Total Passive Components952,295 850,067 945,997 KDP and KCD Resale410,419 377,707 293,048 KCP Resale Connectors54,765 61,809 64,680 Total KED Resale465,184 439,516 357,728 Interconnect127,775 124,817 138,879 Total Revenue$1,545,254 $1,414,400 $1,442,604 Passive Component sales were $946.0 million for the fiscal year ended March 31, 2014 compared to $850.1 million during thefiscal year ended March 31, 2013. The sales increase in Passive Components reflects the demand increase for electronics acrossglobal markets as customers increased inventory levels in response to increased spending by consumers and manufacturers whencompared to the prior year, particularly in the automotive sector and component sales related to higher-end smart phones, tabletdevices and telecommunications hardware. The impact of the Asia Tantalum acquisition, which was completed in February 2013,accounted for $52.6 million of increased sales of our tantalum products. The increase in sales of Ceramic Components reflects ahigher volume of unit sales resulting partially from an increase in the sale of higher capacitance components compared to theprior fiscal year, partially offset by lower selling prices. KDP and KCD Resale sales were $293.0 million for the fiscal year ended March 31, 2014 compared to $377.7 million duringthe fiscal year ended March 31, 2013. When compared to the prior year, the decrease during the fiscal year ended March 31, 2014is primarily attributable to lower sales to telecommunications and computer manufacturers as they changed design specificationsand managed supply chain inventory levels in response to consumer demand trends and new product introduction cycles. Total connector sales, including AVX Interconnect products and KCP Resale Connectors, were $203.6 million in the fiscalyear ended March 31, 2014 compared to $186.6 million during the fiscal year ended March 31, 2013. This increase was primarilyattributable to an increased demand in the automotive sector reflective of the increased electronic content in today’s automobiles. 30 Our sales to independent electronic distributors represented 42.1% of total net sales for the fiscal year ended March 31, 2014,compared to 38.8% for fiscal year ended March 31, 2013. Overall, distributor activity increased when compared to the sameperiod in the prior year reflective of their end customer demand improvements. Our sales to distributor customers may involvespecific ship and debit and stock rotation programs for which sales allowances are recorded as reductions in sales. Such allowancecharges increased to $40.7 million, or 6.7% of gross sales to distributor customers, for the fiscal year ended March 31, 2014compared to $34.3 million, or 6.3% of gross sales to distributor customers, for the fiscal year ended March 31, 2013, reflectingincreased pricing pressure in the marketplace. Applications under such programs for fiscal years ended March 31, 2014 and 2013were approximately $38.3 million and $33.9 million, respectively. Geographically, compared to the fiscal year ended March 31, 2013, sales increased in the Americas and Europe while Asia saw a slight decrease. The Asian market sales reflect the lower KED Resale product sales in the telecommunications markets. Sales inAsia decreased to 45.7% of total sales while sales in the Americas increased to 28.0% and sales in Europe increased to 26.3% oftotal sales, respectively. This compares to 47.5%, 27.6%, and 24.9% of total sales for the Asian, American, and European regionsin the prior year, respectively. As a result of the strength of the U.S. dollar against certain foreign currencies, sales for the yearended March 31, 2014 were unfavorably impacted by approximately $22.3 million when compared to the prior year. Gross profit margin in the fiscal year ended March 31, 2014 increased to 19.3% of sales, or $278.8 million, compared to agross profit margin of 18.6% of sales, or $263.8 million, in the fiscal year ended March 31, 2013. This overall increase is primarilyattributable to an improved product mix of higher margin components coupled with a lower proportion of commodity andKED Resale products partially offset by lower selling prices. When compared to the prior fiscal year, costs were favorablyimpacted by approximately $40.0 million due to the strength of the U.S. dollar against certain foreign currencies. Selling, general, and administrative expenses for the fiscal year ended March 31, 2014 were $119.7 million, or 8.3% of netsales, compared to $117.4 million, or 8.3% of net sales, for the fiscal year ended March 31, 2013. The overall increase in selling,general and administrative expenses reflects the impact of higher sales volumes when compared to the prior year. Research, development, and engineering expenditures, which encompass the personnel and related expenses devoted todeveloping new products and maintaining existing products, processes, and technical innovations, were approximately $26.2million and $30.5 million in fiscal 2014 and 2013, respectively. Research and development costs included therein increased in fiscal2014 to $10.5 million compared to $7.2 million in fiscal 2013. Engineering expenses decreased $7.6 million to $15.7 million infiscal 2014 compared to $23.3 million in fiscal 2013 as we decreased activity related to production moves when compared to theprior year. Profit (loss) from operations for the fiscal year ended March 31, 2014 increased $279.0 million to $159.2 million compared to$(119.8) million for the fiscal year ended March 31, 2013. This increase is a result of the factors above, and the recognition of a$266.3 million environmental charge in 2013 related to remediation issues at the New Bedford Harbor Superfund Site inMassachusetts. See Note 12 to our consolidated financial statements elsewhere herein and “Environmental Matters” in Item 1 forfurther discussion related to this environmental charge. Other income decreased $2.3 million to $4.2 million in fiscal 2014 compared to $6.5 million in fiscal 2013. This decrease isprimarily attributable to lower interest income resulting from lower effective interest rates and a decrease in the balance of our cashand investments.The effective tax rate for the fiscal year ended March 31, 2014 was 22.2% compared to an effective tax rate of 43.2% for thefiscal year ended March 31, 2013. The lower effective rate for fiscal 2014 is primarily due to a favorable impact of approximately$6.6 million relating to the release of certain reserves for uncertain tax positions due to the expiration of tax periods allowed forthe audit of certain prior year income tax returns and one-time adjustments of approximately $4.5 million related to prior periodincome tax accruals. Excluding such discrete items recorded during the fiscal year, the effective tax rate would have been 29.9%.For fiscal 2013, the higher effective rate is primarily due to the effects of the environmental charge recognized in fiscal 2013related to the New Bedford Harbor Superfund Site in Massachusetts and the loss of a U.S. federal tax deduction for fiscal 2013due to annual taxable income limitations. Excluding such discrete items recorded during the fiscal year, the effective tax rate wouldhave been 30.6%.As a result of the factors discussed above, net income for the fiscal year ended March 31, 2014 was $127.0 million comparedto a net loss of $(64.3) million for the fiscal year ended March 31, 2013. 31 Financial Condition Liquidity and Capital Resources Our liquidity needs arise primarily from working capital requirements, dividends, capital expenditures, and acquisitions. Historically, we have satisfied our liquidity requirements through funds from operations and investment income from cash andinvestments in securities. As of March 31, 2015, we had a current ratio of 6.6 to 1, $993.5 million of cash, cash equivalents, andinvestments in securities, $2,132.0 million of stockholders' equity and no borrowings. As of March 31, 2015, we had cash, cash equivalents, and short-term and long-term investments in securities of$993.5 million, of which $712.4 million was held outside the U.S. Liquidity is subject to many factors, such as normal businessoperations as well as general economic, financial, competitive, legislative, and regulatory factors that are beyond our control. Cashbalances generated and held in foreign locations are used for on-going working capital, capital expenditure needs, and to supportacquisitions. These balances are currently expected to be permanently reinvested outside the U.S. If these funds were needed forgeneral corporate purposes in the U.S., we would incur significant income taxes to repatriate to the U.S. cash held in foreignlocations. In addition, local government regulations may restrict our ability to move funds among various locations under certaincircumstances. Management does not believe such restrictions would limit our ability to pursue our intended business strategies. Net cash provided by operating activities was $197.6 million for the fiscal year ended March 31, 2015, compared to cash usedin operations of $70.6 million for the fiscal year ended March 31, 2014 and cash provided by operations of $194.8 million for thefiscal year ended March 31, 2013. Cash provided by operations was higher in fiscal 2015 primarily due to the favorable taxposition resulting in higher net income compared to fiscal 2014, which included two installment payments with respect to thesettlement, approved by the United States District court on September 19, 2013, with the EPA and the Commonwealth ofMassachusetts related to the harbor. October 18, 2013, we paid the initial settlement installment of $133.4 million, plus accruedinterest. We prepaid a second settlement installment of $110.8 million, plus accrued interest on the remaining settlement amounton March 26, 2014. In accordance with the terms of the settlement, we are obligated to pay the remaining balance of $122.1million, plus interest, on September 21, 2015. We have the option to prepay any portion of the remaining settlement balance atany time prior to the due date. Purchases of property and equipment totaled $26.6 million in fiscal 2015, $26.8 million in fiscal 2014, and $43.7 million infiscal 2013. Expenditures primarily related to expanding the production capabilities of the passive component and interconnectproduct lines, expanding production capacity in lower cost regions, as well as the implementation of improved manufacturingprocesses. We continue to make strategic capital investments in our advanced and specialty passive component and interconnectproducts and expect to incur capital expenditures of approximately $30 million in fiscal 2016. The actual amount of capitalexpenditures will depend upon the outlook for end market demand. During fiscal 2013, we acquired Asia Tantalum for a net of $81.2 million in cash. Asia Tantalum designs, develops,manufactures and markets tantalum electronic components. Asia Tantalum’s products are used in a broad range of commercialapplications. The acquisition enhances our leadership position in the passive electronic component industry and provides furtheropportunities for expansion in the Asian region and tantalum manufacturing efficiencies. The majority of our funding is internally generated through operations and investment income from cash, cash equivalents,and investments in securities. We have assessed the condition of the current global credit markets on our current business andbelieve that, based on our financial condition as of March 31, 2015, cash on hand and cash expected to be generated fromoperating activities and investment income from cash, cash equivalents, and investments in securities will be sufficient to satisfy ouranticipated financing needs for working capital, capital expenditures, environmental clean-up costs, pension plan funding,research, development, and engineering expenses, and dividend payments or stock repurchases to be made during the upcomingyear. While changes in customer demand have an impact on our future cash requirements, changes in those requirements aremitigated by our ability to adjust manufacturing capabilities to meet increases or decreases in customer demand. We do notanticipate any significant changes in our ability to generate cash flows or meet our liquidity needs in the foreseeable future. In fiscal 2015, 2014, and 2013, dividends of $67.3 million, $60.3 million, and $50.8 million, respectively, were paid tostockholders. 32 On October 17, 2007, the Board of Directors of the Company authorized the repurchase of an additional 5,000,000 sharesof our common stock. We purchased 524,806 shares at a cost of $7.2 million during fiscal 2015, 799,066 shares at a cost of$10.3 million during fiscal 2014, and 983,608 shares at a cost of $10.6 million during fiscal 2013. The repurchased shares are heldas treasury stock and are available for general corporate purposes. As of March 31, 2015, there were 4,184,583 shares that may yetbe repurchased under this program. At March 31, 2015, we had contractual obligations for the acquisition or construction of plant and equipment aggregatingapproximately $12.2 million. We make contributions to our U.S. and international defined benefit plans as required under various pension fundingregulations. Contributions are based on a percentage of pensionable wages or requirements necessary to satisfy fundingobligations. We made contributions of $2.1 million to our U.S. defined benefit plans during the fiscal year ended March 31, 2015and do not estimate that any contributions will be made during the fiscal year ended March 31, 2016. We made contributions of$8.1 million to our international defined benefit plans during the fiscal year ended March 31, 2015 and estimate that we will makecontributions of approximately $7.2 million during the fiscal year ending March 31, 2016. We have unfunded actuarially computedpension liabilities of approximately $22.9 million related to these defined benefit pension plans as of March 31, 2015. We are a lessee under long‑term operating leases primarily for office space, plant, and equipment. Future minimum leasecommitments under non‑cancelable operating leases as of March 31, 2015, were approximately $20.4 million. From time to time we enter into delivery contracts with selected suppliers for certain metals used in our production processes.The delivery contracts represent routine purchase orders for delivery within three months and payment is due upon receipt. We have been identified by the United States Environmental Protection Agency (“EPA”), state governmental agencies orother private parties as a potentially responsible party (“PRP”) under the Comprehensive Environmental Response,Compensation and Liability Act (“CERCLA”) or equivalent state or local laws for clean-up and response costs associated withcertain sites at which remediation is required with respect to prior contamination. Because CERCLA or such state statutesauthorize joint and several liability, the EPA or state regulatory authorities could seek to recover all clean-up costs from any one ofthe PRPs at a site despite the involvement of other PRPs. At certain sites, financially responsible PRPs other than AVX also are, orhave been, involved in site investigation and clean-up activities. We believe that liability resulting from these sites will beapportioned between AVX and other PRPs. To resolve our liability at the sites at which we have been named a PRP, we have entered into various administrative ordersand consent decrees with federal and state regulatory agencies governing the timing and nature of investigation andremediation. As is customary, the orders and decrees regarding sites where the PRPs are not themselves implementing the chosenremedy contain provisions allowing the EPA to reopen the agreement and seek additional amounts from settling PRPs in theevent that certain contingencies occur, such as the discovery of significant new information about site conditions. On October 10, 2012, the EPA, the United States, the Commonwealth of Massachusetts (the “Commonwealth”) and AVXannounced that they had reached a financial settlement with respect to the EPA’s ongoing clean-up of the New Bedford Harborin the Commonwealth (the “harbor”). That agreement is contained in a Supplemental Consent Decree that modifies certainprovisions of the 1992 Consent Decree regarding clean-up of the harbor, including elimination of the governments’ right toinvoke certain clean-up reopener provisions in the 1992 Consent Decree in the future. Under the terms of the settlement, AVXwas obligated to pay $366.3 million, plus interest computed from August 1, 2012, in three installments over a two-year period foruse by the EPA and the Commonwealth to complete the clean-up of the harbor. The settlement also required the EPA towithdraw the Unilateral Administrative Order (the “UAO”) that was issued on April 18, 2012 regarding additional harbor clean-up activities. The United States District Court approved the settlement and entered the Supplemental Consent Decree onSeptember 19, 2013. On October 18, 2013, we paid the initial settlement installment of $133.4 million, plus accrued interest of$4.0 million. On March 26, 2014, we prepaid a second settlement installment of $110.8 million, plus accrued interest of $0.8million on the remaining settlement amount through that date. In accordance with the terms of the settlement, we are obligated topay the remaining balance of $122.1 million, plus interest, on September 21, 2015. We have the option to prepay any portion ofthe remaining settlement balance at any time prior to the due date. 33 Also, on June 3, 2010, AVX entered into an agreement with the EPA and the City of New Bedford, pursuant to which AVXis required to perform environmental remediation at a site referred to as the “Aerovox Site” (the “Site”), located in New Bedford,Massachusetts. AVX has substantially completed its obligations pursuant to such agreement with the EPA and the City of NewBedford with respect to the satisfaction of AVX’s federal law requirements. Agreements with the state regulatory authorities haveyet to be concluded but are likely to include additional groundwater remediation. We have a remaining accrual of $11.8 million atMarch 31, 2015, representing our estimate of the potential liability related to the remaining performance of environmentalremediation actions at the Site using certain assumptions regarding the plan of remediation. Since additional sampling and analysismay cause the state regulatory authority, the Massachusetts Department of Environmental Protection, to require a more extensiveand costly plan of remediation, until all parties agree and remediation is complete, we cannot be certain there will be no additionalcost relating to the Site. We also operate on other sites that may have potential future environmental issues as a result of activities at sites during AVX’slong history of manufacturing operations or prior to the start of operations by AVX. Even though we may have rights ofindemnity for such environmental matters at certain sites, regulatory agencies in those jurisdictions may require us to address suchissues. Once it becomes probable that we will incur costs in connection with remediation of a site and such costs can bereasonably estimated, we establish reserves or adjust our reserves for our projected share of these costs. A separate accountreceivable is recorded for any indemnified costs. Our environmental reserves are not discounted and do not reflect any possiblefuture insurance recoveries, which are not expected to be significant, but do reflect a reasonable estimate of cost sharing atmultiple party sites or indemnification of our liability by a third party. We had total reserves of approximately $135.3 million and $138.1 million at March 31, 2014 and 2015, respectively, related tothe various environmental matters. These reserves are classified in the Consolidated Balance Sheets as $4.4 million and $127.2million in accrued expenses at March 31, 2014 and 2015, respectively, and $131.0 million and $10.9 million in other non-currentliabilities at March 31, 2014 and March 31, 2015, respectively. The amounts recorded for identified contingent liabilities are basedon estimates. Amounts recorded are reviewed periodically and adjusted to reflect additional legal and technical information thatbecomes available. Also, uncertainties about the status of laws, regulations, regulatory actions, technology, and information relatedto individual sites make it difficult to develop an estimate of the reasonably possible aggregate environmental remediationexposure. Accordingly, these costs could differ from our current estimates.On November 27, 2007, a suit was filed in South Carolina State Court by individuals as a class action with respect to propertyadjacent to our Myrtle Beach, South Carolina factory claiming property values were negatively impacted by alleged migration ofcertain pollutants from our property. The parties agreed to a $1.2 million settlement of the action, which was approved by theCourt on December 15, 2014 and paid in January 2015. An appeal of one aspect of that class action is still pending before theSouth Carolina Supreme Court; if resolved against AVX, it may result in additional litigation. On March 1, 2010, AVX was named as a third party defendant in a case filed in Massachusetts Superior Court captionedDaRosa v. City of New Bedford. This case relates to a former disposal site in the City of New Bedford located at Parker Street. TheCity asserts that a predecessor company, Aerovox, among others, contributed to contamination at that site. AVX believes it hasmeritorious defenses and intends to vigorously defend the case. On October 16, 2014, a case was filed against AVX in Massachusetts Superior Court by the City of New Bedford arisingfrom contamination at the City’s New Bedford Railyard. AVX had previously received a formal demand from the City in theamount of approximately $11.0 million related to activities by Aerovox. AVX believes it has meritorious defenses and intends tovigorously defend the case. On April 25, 2013, AVX was named as a defendant in a patent infringement case filed in the United States District Court forthe District of Delaware captioned Greatbatch, Inc. v AVX Corporation. This case alleges that certain AVX products infringe on oneor more of six Greatbatch patents. AVX believes it has meritorious defenses and intends to vigorously defend the case. On September 2, 2014, a subsidiary of AVX, American Technical Ceramics (“ATC”), was named as a defendant in a patentinfringement case filed in the United States District Court for the District of Delaware captioned Presidio Components, Inc. v. AmericanTechnical Ceramics Corp. This case alleges that certain products of ATC’s infringe on a Presidio patent. AVX believes it hasmeritorious defenses and intends to vigorously defend the case. During the quarter ended September 30, 2014, AVX was named as a co-defendant in a series of cases filed in the UnitedStates and in the Canadian provinces of Quebec, Ontario and British Columbia alleging violations of United States, Canadian,and state antitrust laws asserting that AVX and numerous other companies are participants in alleged price-fixing in the capacitor34 market. The cases in the United States were consolidated into the Northern District of California on October 2, 2014. During thequarter ended December 31, 2014, additional Canadian cases were filed in the provinces of Quebec, Ontario, British Columbia,Saskatchewan and Manitoba. These cases are at the very initial stages. AVX believes it has meritorious defenses and intends tovigorously defend the cases. We are involved in disputes, warranty, and legal proceedings arising in the normal course of business. While we cannot predictthe outcome of these disputes and proceedings, management believes, based upon a review with legal counsel, that none of theseproceedings will have a material impact on our financial position, results of operations, comprehensive income (loss), or cashflows. Disclosures about Contractual Obligations and Commitments The Company has the following contractual obligations and commitments as of March 31, 2015 as noted below. FY 2017 -FY 2019 -Contractual Obligations (in thousands)TotalFY 2016FY 2018FY 2020ThereafterOperating Leases$20,358 $5,257 $7,309 $6,120 $1,672 Plant and Equipment$12,166 $11,827 $339 $ -$ - Table above does not include payments related to the settlement of the harbor disclosed above and in Note 12. During the fiscal year ended March 31, 2015, we made contributions of $4.0 million to Company sponsored retirementsavings plans. Our contributions are partially based on employee contributions as a percentage of their salaries. Certaincontributions by the Company are discretionary and are determined by the Board of Directors each year. We expect that ourcontributions for the fiscal year ending March 31, 2016 will be approximately $4.0 million. During the fiscal year ended March 31, 2015, we made contributions of $2.1 million and $8.1 million to our U.S. andinternational defined benefit plans, respectively. Contributions are based on a percentage of pensionable wages or requirementsnecessary to satisfy funding obligations. We expect to make contributions of approximately $7.2 million for our internationaldefined benefit plans for the fiscal year ending March 31, 2016. We do not anticipate making contributions to the U.S. plans infiscal 2016. From time to time we enter into delivery contracts with selected suppliers for certain metals used in our production processes.The delivery contracts represent routine purchase orders for delivery within three months and payment is due upon receipt. As ofMarch 31, 2015, we had no material outstanding purchase commitments. We have a $6.8 million liability related to our uncertain tax positions. Due to the nature of the underlying liabilities and theextended time often needed to resolve income tax uncertainties, we cannot reasonably estimate the amount or timing of cashpayments that may be required to settle these liabilities beyond 2015. For additional information, refer to Note 9. Critical Accounting Policies and Estimates “Management’s Discussion and Analysis of Financial Condition and Results of Operations” is based upon our consolidatedfinancial statements and the notes thereto, which have been prepared in accordance with generally accepted accounting principlesin the United States. The preparation of these financial statements requires management to make estimates, judgments, andassumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at thedate of the financial statements and the reported amounts of revenues and expenses during the reported periods. 35 On an ongoing basis, management evaluates its estimates and judgments, including those related to revenue recognition,warranties, inventories, pensions, income taxes, and contingencies. Management bases its estimates, judgments, and assumptionson historical experience and on various other factors that are believed to be reasonable under the circumstances, the results ofwhich form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent fromother sources. While our estimates and assumptions are based on our knowledge of current events and actions we may undertakein the future, there can be no assurance that actual results will not differ from these estimates and assumptions. On an ongoingbasis, we evaluate our accounting policies and disclosure practices. In management’s opinion, the critical accounting policies andestimates, as defined below, are more complex in nature and require a higher degree of judgment than the remainder of ouraccounting policies described in Note 1 to our consolidated financial statements elsewhere herein. Revenue Recognition All of our products are built to specification and tested by us or our suppliers for adherence to such specification beforeshipment to customers. We ship products to customers based upon firm orders. Shipping and handling costs are included in costof sales. We recognize revenue when the sales process is complete. This occurs when products are shipped to the customer inaccordance with the terms of an agreement of sale, there is a fixed or determinable selling price, title and risk of loss have beentransferred, and collectability is reasonably assured. Estimates used in determining sales allowance programs described below aresubject to the volatilities of the market place. This includes, but is not limited to, changes in economic conditions, pricing changes,product demand, inventory levels in the supply chain, the effects of technological change, and other variables that might result inchanges to our estimates. Accordingly, there can be no assurance that actual results will not differ from those estimates. Returns Sales revenue and cost of sales reported in the income statement are reduced to reflect estimated returns. We record anestimated sales allowance for returns at the time of sale based on historical trends, current pricing and volume information, othermarket specific information, and input from sales, marketing, and other key management personnel. The amount accrued reflectsthe return of value of the customer’s inventory. These procedures require the exercise of significant judgments. We believe thatthese procedures enable us to make reliable estimates of future returns. Our actual results have historically approximated ourestimates. When the product is returned and verified, the customer is given credit against their accounts receivable. Distribution Programs A portion of our sales are to independent electronic component distributors, which are subject to various distributor salesprograms. We report provisions for distributor allowances in connection with such sales programs as a reduction in revenue andreport distributor allowances in the balance sheet as a reduction in accounts receivable. For the distribution programs describedbelow, we do not track the individual units that we record against specific products sold from distributor inventories, which wouldallow us to directly compare revenue reduction for credits recorded during any period with credits ultimately awarded in respect ofproducts sold during that period. Nevertheless, we believe that we have an adequate basis to assess the reasonableness andreliability of our estimates for each program. Distributor Stock Rotation Program Stock rotation is a program whereby distributors are allowed to return for credit qualified inventory, semi-annually, equal to acertain percentage, primarily limited to 5% of the previous six months net sales. We record an estimated sales allowance for stockrotation at the time of sale based on a percentage of distributor sales using historical trends, current pricing and volumeinformation, other market specific information, and input from sales, marketing, and other key management personnel. Theseprocedures require the exercise of significant judgment. We believe that these procedures enable us to make reliable estimates offuture returns under the stock rotation program. Our actual results have historically approximated our estimates. When theproduct is returned and verified, the distributor is given credit against their accounts receivable. 36 Distributor Ship-from-Stock and Debit Program Ship-from-Stock and Debit (“ship and debit”) is a program designed to assist distributor customers in meeting competitiveprices in the marketplace on sales to their end customers. Ship and debit programs require a request from the distributor for apricing adjustment for a specific part for a sale to the distributor’s end customer from the distributor’s stock. Ship and debitauthorizations may cover current and future distributor activity for a specific part for sale to their customer. At the time we recordsales to the distributors, we provide an allowance for the estimated future distributor activity related to such sales since it isprobable that such sales to distributors will result in ship and debit activity. We record an estimated sales allowance based on salesduring the period, credits issued to distributors, distributor inventory levels, historical trends, market conditions, pricing trends wesee in our direct sales activity with original equipment manufacturers and other customers, and input from sales, marketing, andother key management personnel. These procedures require the exercise of significant judgment. We believe that these proceduresenable us to make reliable estimates of future credits under the ship and debit program. Our actual results have historicallyapproximated our estimates. At the time the distributor ships the part from stock, the distributor debits us for the authorizedpricing adjustment. Special Incentive Programs We may offer special incentive discounts based on amount of product ordered or shipped. At the time we record sales underthese agreements, we provide an allowance for the discounts on the sales for which the customer is eligible to take. The customerthen debits us for the authorized discount amount. Inventories We determine the cost of raw materials, work in process, and finished goods inventories by the first-in, first-out (“FIFO”)method. Manufactured inventory costs include material, labor, and manufacturing overhead. Inventories are valued at the lower ofcost or market (net realizable value). We value inventory at its market value where there is evidence that the utility of goods will beless than cost and that such write-down should occur in the current period. Accordingly, at the end of each period, we evaluateour inventory and adjust to net realizable value the carrying value and excess quantities. We review and adjust the carrying value ofour inventories based on historical usage, customer forecasts received from marketing and sales personnel, customer backlog,certain date code restrictions, technology changes, demand increases and decreases, market directional shifts, and obsolescenceand aging. Income Taxes As part of the process of preparing our consolidated financial statements, we are required to estimate our tax assets andliabilities in each of the jurisdictions in which we operate. This process involves management estimating the actual current taxexposure together with assessing temporary differences resulting from different treatment of items for tax and accountingpurposes. These differences result in deferred tax assets and liabilities that are included within our consolidated balance sheets. Weassess the likelihood that our deferred tax assets will be recoverable based on all available evidence, both positive and negative. Tothe extent we believe that recovery is not more likely than not, we establish a valuation allowance. We have recorded valuation allowances due to uncertainties related to our ability to realize some of our deferred tax assets,primarily consisting of certain net operating losses carried forward before they expire. The valuation allowance is based on ourestimates of future taxable income over the periods that our deferred tax assets will be recoverable. We continue to evaluatecountries where we have a valuation allowance on our deferred tax assets due to historical operating losses and when such positiveevidence outweighs negative evidence we will release such valuation allowance as appropriate. We also record a provision for certain international, federal, and state tax contingencies based on the likelihood of obligation,when needed. In the normal course of business, we are subject to challenges from U.S. and non-U.S. tax authorities regarding theamount of taxes due. These challenges may result in adjustments of the timing or amount of taxable income or deductions or theallocation of income among tax jurisdictions. Further, during the ordinary course of business, other changing facts andcircumstances may impact our ability to utilize tax benefits as well as the estimated taxes to be paid in future periods. We believethat any potential tax exposures have been sufficiently provided for in the consolidated financial statements. In the event thatactual results differ from these estimates, we may need to adjust tax accounts and related payments, which could materially impactour financial condition and results of operations. 37 We account for uncertainty in income taxes recognized in our financial statements. We recognize in our financial statementsthe impact of a tax position, if that position would “more likely than not” be sustained on audit, based on the technical merits ofthe position. Accruals for estimated interest and penalties are recorded as a component of interest expense. We record deferred tax liabilities for temporary differences associated with deductions for foreign branch losses claimed by usin our U.S. income tax returns, as these deductions are subject to recapture provisions in the U.S. income tax code. When therecapture period expires for these deductions, the liabilities are removed and the tax benefit is recognized in the income taxprovision. Pension Assumptions Pension benefit obligations and the related effects on operations are calculated using actuarial models. Two criticalassumptions, discount rate and expected rate of return on plan assets, are important elements of plan expense and/or liabilitymeasurement. We evaluate these assumptions at least annually. The discount rate enables us to state expected future cash flows at apresent value on the measurement date. To determine the discount rate, we apply the expected cash flows from each individualpension plan to specific yield curves at the plan’s measurement date and determine a level equivalent yield that may be unique toeach plan. A lower discount rate increases the present value of benefit obligations and increases pension expense. To determinethe expected long-term rate of return on pension plan assets, we consider the current and expected asset allocations, as well ashistorical and expected returns on various categories of plan assets. Other assumptions involve demographic factors such asretirement, mortality, and turnover. These assumptions are evaluated periodically and are updated to reflect our experience. Actualresults in any given year will often differ from actuarial assumptions because of economic and other factors. In such cases, thedifferences between actual results and actuarial assumptions are amortized over future periods. Environmental Compliance We are subject to federal, state, and local laws and regulations concerning the environment in the United States and to theenvironmental laws and regulations of the other countries in which we operate. Based on our periodic review of the operatingpolicies and practices at all of our facilities, we believe that our operations are currently in substantial compliance, in all materialrespects, with all applicable environmental laws and regulations. Regarding sites identified by the EPA at which remediation isrequired, our ultimate liability in connection with environmental claims will depend on many factors, including our volumetricshare of non-environmentally safe waste, the total cost of remediation, and the financial viability of other companies havingliability. Additionally, we operate on sites that may have potential future environmental issues as a result of activities at sites duringthe long history of manufacturing operations by AVX or its corporate predecessor or prior to the start of operations by AVX.Even though we may have rights of indemnity for such environmental matters at certain sites, regulatory agencies in thosejurisdictions may require us to address such issues. We recognize liabilities for environmental exposures when analysis indicates thatit is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. When a range of loss canbe estimated, we accrue the most likely amount. In the event that no amount in the range of probable loss is considered mostlikely, the minimum loss in the range is accrued. Amounts recorded are reviewed periodically and adjusted to reflect additionallegal and technical information that becomes available. The uncertainties about the status of laws, regulations, regulatory actions,technology, and information related to individual sites make it difficult to develop an estimate of the reasonably possible aggregateenvironmental remediation exposure, therefore these costs could differ from our current estimates. Our environmental reservesare not discounted and do not reflect any possible future insurance recoveries, which are not expected to be significant, but doreflect a reasonable estimate of cost sharing at multiple party sites or indemnification of our liability by a third party. Recent Accounting Pronouncements In April 2014, the FASB issued changes to the criteria for determining which disposals are required to be presented asdiscontinued operations. The changes require a disposal of a component of an entity or a group of components of an entity tobe reported in discontinued operations if the disposal represents a strategic shift that has, or will have, a major effect on an entity’soperations and financial results when any of the following occurs: (i) the component of an entity or group of components of anentity meets the criteria to be classified as held for sale, (ii) the component of an entity or group or components of an entity isdisposed of by sale, or (iii) the component of an entity or group of components of an entity is disposed of other than by sale.The amendments apply on a prospective basis to disposals of components of an entity that occur within annual periodsbeginning on or after December 15, 2014 and interim periods within those years, with early adoption permitted. Theimplementation of the amended accounting guidance on January 1, 2015 did not have a material impact on our consolidatedfinancial statements.38  In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” This guidance modifies thefinancial reporting of revenue and how an entity will determine the measurement of revenue and timing of when it is recognized.The guidance provides for a five-step approach in applying the standard: 1) identifying the contract with the customer, 2)identifying separate performance obligations in the contract, 3) determining the transaction price, 4) allocating the transactionprice to separate performance obligations, and 5) recognizing the revenue when the performance obligation has been satisfied.The new guidance requires enhanced disclosures for the nature, amount, timing, and uncertainty of revenue that is beingrecognized. The guidance is effective for public companies for interim and annual reporting periods beginning after December15, 2016. Companies may use either a full retrospective or a modified retrospective approach to adopt ASU 2014-09. Earlyadoption is not permitted. Management is currently evaluating the impact of this guidance on our consolidated financialstatements. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40);Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” This update requires management toevaluate whether there is substantial doubt about the Company’s ability to continue as a going concern. This update is effective forthe annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The implementation of thisstandard is not expected to have an impact on our consolidated financial statements upon adoption. We have reviewed other newly issued accounting pronouncements and concluded that they are either not applicable to ourbusiness or that no material effect is expected on our consolidated financial statements as a result of future adoption. Relationship with Kyocera and Related Transactions Kyocera is the majority stockholder of AVX. As of May 11, 2015, Kyocera owned beneficially and of record 121,800,000shares of AVX common stock, representing approximately 72% of our outstanding shares. From January 1990 through August 15, 1995, AVX was wholly owned by Kyocera. On August 15, 1995, Kyocera sold 22.9%,or 39,300,000 shares of AVX's common stock, and AVX sold an additional 4,400,000 shares of common stock, in a publicoffering. In February 2000, Kyocera sold an additional 10,500,000 shares of its AVX common stock. Our business includes transactions with Kyocera. Such transactions involve the purchase of resale inventories, raw materials,supplies and equipment, the sale of products for resale, raw materials, supplies and equipment, the payment of dividends,subcontracting activities, and commissions. See Note 14 to our consolidated financial statements elsewhere herein for moreinformation on the related party transactions. Kyocera notified AVX in February 2014 of its intent, effective April 1, 2015, to market its connector products in Asia usingKyocera’s sales force rather than continuing to have AVX resell such products in Asia. Sales of Kyocera connector products inAsia were $47.5 million and $43.9 million with operating profit of $1.9 million and $2.7 million for the fiscal years ended March31, 2015 and March 31, 2014, respectively One principal strategic advantage for AVX is our ability to produce a broad product offering to our customers. The inclusionof products manufactured by Kyocera in that product offering is a significant component of this advantage. In addition, theexchange of information with Kyocera relating to the development and manufacture of multi-layer ceramic capacitors and variousother ceramic products benefits AVX. An adverse change in our relationship with Kyocera could have a negative impact on ourresults of operations. AVX and Kyocera have executed several agreements that govern the foregoing transactions and which aredescribed below. 39 The Special Advisory Committee of our Board, comprised of our independent directors (currently Messrs. Stach, DeCenzo,and Christiansen), reviews and approves any significant agreements between AVX and Kyocera and any significant transactionsbetween AVX and Kyocera not covered by such agreements. The committee is also responsible for reviewing and approving anyagreements and transactions between AVX and any other related party that are or may be within the scope of applicable rules,regulations and guidance of the New York Stock Exchange and Item 404 of Regulation S-K, if they arise. The Special AdvisoryCommittee operates under a written charter which sets forth the policies and procedures for such approvals. In approving anysuch agreement or transaction pursuant to those procedures, the Special Advisory Committee must determine that, in itsjudgment, the terms thereof are equivalent to those to which an independent unrelated party would agree at arm’s-length or areotherwise in the best interests of the Company and its stockholders generally. Each of the agreements described below containsprovisions requiring that the terms of any transaction under such agreement be equivalent to those to which an independentunrelated party would agree at arm's-length. Products Supply and Distribution Agreement. Pursuant to the Products Supply and Distribution Agreement (the “DistributionAgreement”) (i) AVX will act as the non-exclusive distributor of certain Kyocera-manufactured products to certain customers incertain territories outside of Japan and (ii) Kyocera will act as the non-exclusive distributor of certain AVX-manufactured productswithin Japan. The Distribution Agreement has a term of one year, with automatic one-year renewals, subject to the right oftermination by either party at the end of the then current term upon at least three months prior written notice. Disclosure and Option to License Agreement. Pursuant to the Disclosure and Option to License Agreement (the “LicenseAgreement”), AVX and Kyocera exchange confidential information relating to the development and manufacture of multi-layered ceramic capacitors and various other ceramic products, as well as the license of technologies in certain circumstances. TheLicense Agreement has a term of one year with automatic one-year renewals, subject to the right of termination by either party atthe end of the then current term upon at least six months prior written notice. Materials Supply Agreement. Pursuant to the Materials Supply Agreement (the “Supply Agreement”), AVX and Kyocera will,from time to time, supply the other party with certain raw and semi-processed materials used in the manufacture of capacitors andother electronic components. The Supply Agreement has a term of one year, with automatic one-year renewals, subject to theright of termination by either party at the end of the then current term upon at least six months prior written notice. Machinery and Equipment Purchase Agreement. Pursuant to the Machinery and Equipment Purchase Agreement (the “MachineryPurchase Agreement”), AVX and Kyocera will, from time to time, design and manufacture for the other party certain equipmentand machinery of a proprietary and confidential nature used in the manufacture of capacitors and other electroniccomponents. The Machinery Purchase Agreement has a term of one year, with automatic one-year renewals, subject to the rightof termination by either party at the end of the then current term upon at least six months prior written notice. Item 7A.Quantitative and Qualitative Disclosures About Market Risk Foreign Currency We are exposed to foreign currency exchange risk with respect to our sales, profits, and assets and liabilities denominated incurrencies other than the U.S. dollar. Although we use financial instruments to hedge certain foreign currency risks, we are notfully protected against foreign currency fluctuations and our reported results of operations could be affected by changes in foreigncurrency exchange rates. International revenues and expenses transacted by our foreign subsidiaries may be denominated in localcurrency. See Note 13 to the consolidated financial statements elsewhere herein for further discussion of derivative financialinstruments. For fiscal 2015, our exposure to foreign currency exchange risk was estimated using a sensitivity analysis, which illustrates ahypothetical change in the average foreign currency exchange rates used during the year. Actual changes in foreign currencyexchange rates may differ from this hypothetical change. Based on a hypothetical increase or decrease of 10% in the exchangerates, assuming no hedging against foreign currency rate changes, we would have incurred an additional foreign currency gain orloss of approximately $15.3 million in fiscal 2015. 40 Materials We are at risk to fluctuations in prices for commodities used to manufacture our products, primarily tantalum, palladium,platinum, silver, nickel, gold, and copper. Prices for many of these metals have fluctuated significantly during the past year. Tantalum powder and wire are principal materials used in the manufacture of tantalum capacitor products. The tantalumrequired to manufacture our products has generally been available in sufficient quantity. The limited number of tantalum materialsuppliers has led to higher prices during periods of increased demand. Item 8.Financial Statements and Supplementary Data The following consolidated financial statements of the Company and its subsidiaries, together with the Report ofIndependent Registered Public Accounting Firm thereon, are presented beginning on page 47 of this report: Consolidated Balance Sheets, March 31, 2014 and 2015 47Consolidated Statements of Operations, Years Ended March 31, 2013, 2014, and 2015 48Consolidated Statements of Comprehensive Income (Loss), Years Ended March 31, 2013, 2014, and 2015 49Consolidated Statements of Stockholders’ Equity, Years Ended March 31, 2013, 2014, and 2015 50Consolidated Statements of Cash Flows, Years Ended March 31, 2013, 2014, and 2015 51Notes to Consolidated Financial Statements 52Report of Independent Registered Public Accounting Firm 83 All financial statement schedules are omitted because of the absence of the conditions under which they are required orbecause the information required is shown in the consolidated financial statements or notes thereto. Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. Item 9A.Controls and Procedures Disclosure Controls and Procedures The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the ExchangeAct), that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act isrecorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that suchinformation is accumulated and communicated to management, including the Company’s Chief Executive Officer (“CEO”) andChief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure. In connection with the preparation of this Annual Report on Form 10-K, as of March 31, 2015, an evaluation wasperformed under the supervision and with the participation of the Company’s management, including the CEO and CFO, of theeffectiveness of the Company’s disclosure controls and procedures. Based on the evaluation, the Company’s CEO and CFOconcluded that the Company’s disclosure controls and procedures were effective as of March 31, 2015 to ensure that informationrequired to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed,summarized, and reported, within the time periods specified in the SEC’s rules and forms and is accumulated and communicatedto the Company’s management, including the CEO and CFO, or persons performing similar functions, as appropriate, to allowtimely decisions regarding required disclosures. 41 Management’s Report on Internal Control over Financial Reporting The management of the Company is responsible for establishing and maintaining adequate internal control over financialreporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the ExchangeAct as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers andeffected by the Company’s Board of Directors, management, and other personnel, to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements for external purposes in accordance with generallyaccepted accounting principles and includes those policies and procedures that (i) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance withauthorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on thefinancial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequatebecause of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as ofMarch 31, 2015. In making its assessment, the Company’s management used the criteria set forth by the Committee ofSponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013). Based on the results of thisassessment, management, including the CEO and CFO, has concluded that the Company’s internal control over financialreporting was effective as of the end of its fiscal year ended March 31, 2015. PricewaterhouseCoopers LLP, our independent registered public accounting firm, has issued an attestation report on theCompany’s internal control over financial reporting as of March 31, 2015, as stated in their report, which appears in this Form10-K. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting that occurred during our most recently completedfiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B.Other Information None PART III Item 10.Directors, Executive Officers, and Corporate Governance Information required by this item with respect to our directors, the committees of the Board of Directors, corporategovernance and compliance by our directors, executive officers, and certain beneficial owners of our common stock with Section16(a) of the Exchange Act is provided by incorporation by reference to information under the captions entitled “Proposal IElection of Directors”, “Board of Directors – Governance”, “Board of Directors – Meetings Held and Committees” and“Section 16(a) Beneficial Ownership Reporting Compliance” in the Company's definitive proxy statement for the 2015 AnnualMeeting of Stockholders (the “Proxy Statement”) and perhaps elsewhere therein. Information required by this item relating to ourexecutive officers also appears in Item 1 of Part I of this Form 10-K under the caption “Executive Officers of the Registrant”. 42 Code of Business Conduct and Ethics As discussed above in “Company Information and Website” in Item 1 of Part I of this Annual Report on Form 10-K, ourCode of Business Conduct and Ethics and the Code of Business Conduct and Ethics Supplement Applicable to the ChiefExecutive Officer, Chief Financial Officer, Controllers and Financial Managers have been posted on our website. We will post onour website any amendments to, or waivers from, a provision of the Code of Business Conduct and Ethics or the SupplementApplicable to the Chief Executive Officer, Chief Financial Officer, Controllers and Financial Managers that applies to ourprincipal executive officer, principal financial officer, principal accounting officer, or controller, or persons performing similarfunctions, and that relates to any of the following: (i) honest and ethical conduct, including the ethical handling of actual orapparent conflicts of interest between personal and professional relationships; (ii) full, fair, accurate, timely, and understandabledisclosure in reports and documents that we file with, or submit to, the SEC and in other public communications made by us; (iii)compliance with applicable governmental laws, rules, and regulations; (iv) the prompt internal reporting of violations of the codeto an appropriate person or persons identified in the code; or (v) accountability for adherence to the code. Item 11.Executive Compensation The information required by this item is provided by incorporation by reference to information under the captions entitled “Director Compensation”, “Compensation Committee Interlocks and Insider Participation”, “Compensation CommitteeReport”, “Compensation Discussion and Analysis”, and “Executive Compensation” in the Proxy Statement and perhapselsewhere therein. Item 12.Security Ownership of Certain Beneficial Owners and Management and RelatedStockholder Matters The information required by this item is provided by incorporation by reference to information under the captions entitled“Ownership of Securities by Directors, Director Nominees and Executive Officers”, “Security Ownership of Certain BeneficialOwners” and “Equity Compensation Plan Information” in the Proxy Statement and perhaps elsewhere therein. Item 13.Certain Relationships and Related Transactions, and Director Independence The information required by this item is provided by incorporation by reference to information under the caption“Relationship with Kyocera and Related Transactions” and “Board of Directors – Governance” in the Proxy Statement andperhaps elsewhere therein. Item 14.Principal Accounting Fees and Services The information required by this item is provided by incorporation by reference to information under the caption entitled“Report of the Audit Committee – Principal Independent Registered Public Accounting Firm Fees” in the Proxy Statement andperhaps elsewhere therein. PART IV Item 15.Exhibits and Financial Statement Schedules (a)Financial Statements and Financial Statement Schedules ‑ See Index to Consolidated FinancialStatements at Item 8 of this report. (b)Exhibits: As indicated below, certain of the exhibits to this report are hereby incorporated by reference from other documentson file with the Securities and Exchange Commission.43 3.1 Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to Registration Statement on Form S-1(File No. 33-94310) of the Company (the “Form S-1”)).3.2 By‑laws of AVX Corporation as Amended and Restated May 7, 2012 (incorporated by reference to Exhibit 3.2 of theCurrent Report on Form 8-K filed with the Securities and Exchange Commission on May 11, 2012).*10.1Amended AVX Corporation 1995 Stock Option Plan as amended through October 24, 2000 (incorporated byreference to Exhibit 10.11 to the Quarterly Report on Form 10-Q of the Company for the quarter ended December31, 2000).10.2 Products Supply and Distribution Agreement by and between Kyocera Corporation and AVX Corporation(incorporated by reference to Exhibit 10.4 to the Annual Report on Form 10-K of the Company for the year endedMarch 31, 2000).*10.3AVX Nonqualified Supplemental Retirement Plan Amended and Restated effective January 1, 2008 (the AVXCorporation SERP was merged into this plan effective January 1, 2005) (incorporated by reference to Exhibit 10.4 tothe Annual Report on Form10-K of the Company for the year ended March 31, 2009).*10.4Amendment to AVX Nonqualified Supplemental Retirement Plan, effective December 15, 2014.*10.5Agreement between AVX Corporation and John S. Gilbertson dated December 19, 2008 (incorporated by referenceto Exhibit 10.10 to the Quarterly Report on Form 10-Q of the Company for the quarter ended December 31, 2008).*10.6AVX Corporation 2004 Stock Option Plan as amended through July 23, 2008 (incorporated by reference to Exhibit10.1 to the Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2008).*10.7AVX Corporation 2004 Non-Employee Directors’ Stock Option Plan as amended through July 28, 2008(incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q of the Company for the quarterended June 30, 2008).*10.8Form of Notice of Grant of Stock Options and Option Agreement for awards pursuant to AVX Corporation 2004Stock Option Plan and AVX Corporation 2004 Non-Employee Directors’ Stock Option Plan (incorporated byreference to Exhibit 10.8 to the Annual Report on Form 10-K of the Company for the year ended March 31, 2013).*10.9AVX Corporation 2009 Management Incentive Plan (incorporated by reference to Exhibit 10.1 to the QuarterlyReport on Form 10-Q of the Company for the quarter ended June 30, 2009). 10.10 Machinery and Equipment Purchase Agreement by and between Kyocera Corporation and AVX Corporation(incorporated by reference to Exhibit 10.14 to the Annual Report on Form 10-K of the Company for the year endedMarch 31, 2005).10.11 Materials Supply Agreement by and between Kyocera Corporation and AVX Corporation (incorporated by referenceto Exhibit 10.15 to the Annual Report on Form 10-K of the Company for the year ended March 31, 2005).10.12 Disclosure and Option to License Agreement effective as of April 1, 2008 by and between Kyocera Corporation andAVX Corporation (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Companyfiled with the Securities and Exchange Commission on March 25, 2008).44 10.13 Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.16 to the AnnualReport on Form 10-K of the Company for year ended March 31, 2010). 10.14 Supplemental Consent Decree with Defendant AVX Corporation containing agreement among the Company, theUnited States Environmental Protection Agency and the Commonwealth of Massachusetts, dated October 10, 2012(incorporated by reference to Exhibit 99.2 to Current Report on Form 8-K of the Company filed with the Securitiesand Exchange Commission on October 11, 2012).*10.15AVX Corporation 2014 Stock Option Plan (incorporated by reference to Exhibit 10.17 of the Annual Report onForm 10K/A of the Company for the year ended March 31, 2013).*10.16AVX Corporation 2014 Non-Employee Directors’ Stock Option Plan (incorporated by reference to Exhibit 10.18 ofthe Annual Report on Form 10K/A of the Company for the year ended March 31, 2013).*10.17Form of Notice of Grant of Stock Options and Option Agreement for awards pursuant to AVX Corporation 2014Stock Option Plan and AVX Corporation 2014 Non-Employee Directors’ Stock Option Plan (incorporated byreference to Exhibit 10.19 of the Annual Report on Form 10-K of the Company for the year ended March 31, 2014).*10.18AVX Corporation 2014 Restricted Stock Unit Plan (incorporated by reference to Exhibit 99.1 of Form S-8 filed withthe Securities and Exchange Commission on August 6, 2014.)*10.19AVX Corporation 2014 Management Incentive Plan.21.1 Subsidiaries of the Registrant.23.1 Consent of PricewaterhouseCoopers LLP.24.1 Power of Attorney31.1 Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer – John Sarvis31.2 Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer – Kurt P. Cummings32.1 Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of2002 - John Sarvis and Kurt P. Cummings* Agreement relates to executive compensation. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused thisreport to be signed on its behalf by the undersigned, thereunto duly authorized. AVX Corporationby: /s/ Kurt P. CummingsKURT P. CUMMINGSVice President, Chief Financial Officer, Treasurer andSecretaryDated: May 20, 2015 45 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the followingpersons on behalf of the registrant and in the capacities and on the dates indicated. Signature TitleDate *President and Chief Executive OfficerMay 20, 2015John Sarvis(Principal Executive Officer) /s/ Kurt P. CummingsVice President, Chief Financial Officer, Treasurer andSecretaryMay 20, 2015Kurt P. Cummings(Principal Financial Officer and Principal Accounting Officer) * Kazuo Inamori Chairman Emeritus of the BoardMay 20, 2015* Tetsuo Kuba DirectorMay 20, 2015* Goro Yamaguchi DirectorMay 20, 2015* Tatsumi Maeda DirectorMay 20, 2015* Shoichi Aoki DirectorMay 20, 2015* Donald B. Christiansen DirectorMay 20, 2015* David DeCenzo DirectorMay 20, 2015* Joseph Stach DirectorMay 20, 2015 * by: /s/ Kurt P. Cummings KURT P. CUMMINGS, Attorney‑in‑Fact for each of the persons indicated. 46 AVX Corporation and SubsidiariesConsolidated Balance Sheets(in thousands, except per share data) As of March 31, 20142015AssetsCurrent assets:Cash and cash equivalents$460,674 $381,605 Short-term investments in securities413,615 461,901 Accounts receivable - trade, net206,417 186,615 Accounts receivable - affiliates2,028 2,377 Inventories550,518 535,912 Income taxes receivable71,346 67,504 Deferred income taxes31,896 76,963 Prepaid and other32,229 31,675 Total current assets1,768,723 1,744,552 Long-term investments in securities25,000 150,029 Property and equipment, net235,725 199,842 Goodwill213,051 213,051 Intangible assets, net67,735 62,587 Deferred income taxes - non-current65,524 79,276 Other assets9,230 9,678 Total Assets$2,384,988 $2,459,015 Liabilities and Stockholders' EquityCurrent liabilities:Accounts payable - trade$49,576 $35,290 Accounts payable - affiliates45,058 40,753 Income taxes payable2,956 4,450 Deferred income taxes952 424 Accrued payroll and benefits38,867 38,952 Accrued expenses24,525 146,440 Total current liabilities161,934 266,309 Pensions18,267 22,520 Deferred income taxes - non-current5,453 5,770 Other liabilities151,649 32,453 Total non-current liabilities175,369 60,743 Total Liabilities337,303 327,052 Commitments and contingencies (Note 12)Stockholders' Equity:Preferred stock, par value $.01 per share: - -Authorized, 20,000 shares; None issued and outstandingCommon stock, par value $.01 per share:1,764 1,764 Authorized, 300,000 shares; issued, 176,368 shares; outstanding, 168,221 and 168,190 shares for 2014 and 2015, respectivelyAdditional paid-in capital351,708 352,996 Retained earnings1,789,856 1,948,476 Accumulated other comprehensive income (loss)8,126 (66,665)Treasury stock, at cost,(103,769)(104,608)8,148 and 8,178 shares for 2014 and 2015, respectivelyTotal Stockholders' Equity2,047,685 2,131,963 Total Liabilities and Stockholders' Equity$2,384,988 $2,459,015 See accompanying notes to consolidated financial statements.47 AVX Corporation and SubsidiariesConsolidated Statements of Operations(in thousands, except per share data) Fiscal Year Ended March 31, 201320142015Net sales$1,414,400 $1,442,604 $1,353,228 Cost of sales1,150,630 1,163,770 1,024,659 Gross profit263,770 278,834 328,569 Selling, general and administrative expenses117,365 119,670 115,820 Environmental charges266,250 - -Profit (loss) from operations(119,845)159,164 212,749 Other income (expense):Interest income7,021 4,899 4,554 Interest expense(2,262)(2,432)(978)Other, net1,764 1,726 2,274 Income (loss) before income taxes(113,322)163,357 218,599 Provision for (benefit from) income taxes(49,010)36,320 (7,272)Net income (loss)$(64,312)$127,037 $225,871 Income (loss) per share:Basic$(0.38)$0.75 $1.34 Diluted$(0.38)$0.75 $1.34 Dividends declared$0.3125 $0.3650 $0.4100 Weighted average common shares outstanding:Basic169,124 168,473 168,148 Diluted169,124 168,658 168,402 See accompanying notes to consolidated financial statements.48 AVX Corporation and SubsidiariesConsolidated Statements of Comprehensive Income (Loss)(in thousands) Fiscal Year Ended March 31, 201320142015Net income (loss)$(64,312)$127,037 $225,871 Other comprehensive income (loss), net of income taxes:Foreign currency translation adjustment(10,249)4,670 (64,734)Foreign currency cash flow hedges adjustment356 933 (2)Pension liabilities adjustment(13,801)6,854 (7,494)Other post-employment obligations - -(2,561)Other comprehensive income (loss), net of income taxes(23,694)12,457 (74,791)Comprehensive income (loss)$(88,006)$139,494 $151,080 See accompanying notes to consolidated financial statements.49 AVX Corporation and SubsidiariesConsolidated Statements of Stockholders’ Equity(in thousands, except per share data) Accumulated Common StockAdditionalOther NumberTreasuryPaid-InRetainedComprehensive Of SharesAmountStockCapitalEarningsIncome (Loss)TotalBALANCE AT MARCH 31, 2012169,601 $1,764 $(87,988)$349,474 $1,838,140 $19,363 $2,120,753 Net loss - - - -(64,312) -(64,312)Other comprehensiveloss, net of income taxes - - - - -(23,694)(23,694)Dividends of $0.30 per share(50,758)(50,758)Stock-basedcompensation expense - - -1,358 - -1,358 Stock option activity16 -204 (49) - -155 Tax benefit of stockoption exercises - - -8 - -8 Treasury stock purchased(984) -(10,580) - - -(10,580)BALANCE AT MARCH 31, 2013168,633 $1,764 $(98,364)$350,791 $1,723,070 $(4,331)$1,972,930 Net income - - - -127,037 -127,037 Other comprehensiveincome, net of income taxes - - - - -12,457 12,457 Dividends of $0.37 per share - - - -(60,251) -(60,251)Stock-basedcompensation expense - - -1,363 - -1,363 Stock option activity387 -4,915 (672) - -4,243 Tax benefit of stockoption exercises - - -226 - -226 Treasury stock purchased(799) -(10,320) - - -(10,320)BALANCE AT MARCH 31, 2014168,221 $1,764 $(103,769)$351,708 $1,789,856 $8,126 $2,047,685 Net income - - - -225,871 -225,871 Other comprehensiveloss, net of income taxes - - - - -(74,791)(74,791)Dividends of $0.40 per share - - - -(67,251) -(67,251)Stock-basedcompensation expense - - -1,456 - -1,456 Stock option activity495 -6,318 (642) - -5,676 Tax benefit of stockoption exercises - - -474 - -474 Treasury stock purchased(525) -(7,157) - - -(7,157)BALANCE AT MARCH 31, 2015168,191 $1,764 $(104,608)$352,996 $1,948,476 $(66,665)$2,131,963 See accompanying notes to consolidated financial statements.50 AVX Corporation and SubsidiariesConsolidated Statements of Cash Flows (in thousands) Fiscal Year Ended March 31, 201320142015OPERATING ACTIVITIES:Net income (loss)$(64,312)$127,037 $225,871 Adjustment to reconcile net income (loss) to net cash from operating activities:Depreciation and amortization46,871 50,209 42,214 Stock-based compensation expense1,358 1,363 1,456 Deferred income taxes(76,408)70,726 (58,387)Loss on disposal of property, plant & equipment, net of retirements219 174 42 Changes in operating assets and liabilities:Accounts receivable14,625 (7,639)18,773 Inventories17,586 9,778 (3,005)Accounts payable and accrued expenses45,224 (169,535)115,401 Income taxes(12,433)1,165 3,336 Other assets887 (42,535)(23,939)Other liabilities221,178 (111,380)(124,173)Net cash provided by (used in) operating activities194,795 (70,637)197,589 INVESTING ACTIVITIES:Purchases of property and equipment(43,705)(26,805)(26,599)Purchase of business, net of cash acquired(79,608)(1,600) -Purchases of investment securities(675,394)(663,816)(1,064,254)Redemptions of investment securities755,610 801,542 886,656 Proceeds from property, plant & equipment dispositions1,851 795 88 Other investing activities(170) - -Net cash provided by (used in) investing activities(41,416)110,116 (204,109)FINANCING ACTIVITIES:Dividends paid(50,758)(60,251)(67,251)Purchase of treasury stock(10,580)(10,320)(7,157)Proceeds from exercise of stock options155 4,243 5,676 Excess tax benefit from stock-based payment arrangements8 226 474 Net cash used in financing activities(61,175)(66,102)(68,258)Effect of exchange rate changes on cash(764)573 (4,291)Increase (decrease) in cash and cash equivalents91,440 (26,050)(79,069)Cash and cash equivalents at beginning of period395,284 486,724 460,674 Cash and cash equivalents at end of period$486,724 $460,674 $381,605 See accompanying notes to consolidated financial statements.51 AVX Corporation and SubsidiariesNotes to Consolidated Financial Statements(in thousands, except per share data) 1. Summary of Significant Accounting Policies: General: AVX Corporation is a leading worldwide manufacturer and supplier and reseller of a broad line of passive electroniccomponents and interconnect products. Our consolidated financial statements of AVX Corporation (“AVX” or “the Company”)include all accounts of the Company and its subsidiaries. All significant intercompany transactions and accounts have beeneliminated. From January 1990 through August 15, 1995, we were wholly owned by Kyocera Corporation (“Kyocera”). As of March 31,2015, Kyocera owned approximately 72% of our outstanding shares of common stock. Use of Estimates: The consolidated financial statements are prepared on the basis of U.S. generally accepted accounting principles. Thepreparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assetsand liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amountsof revenues and expenses during the reported periods. We base our estimates and judgments on historical experience and onvarious other factors that are believed to be reasonable under the circumstances, the results of which form the basis for makingjudgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be noassurance that actual results will not differ from those estimates. On an ongoing basis, we evaluate our accounting policies anddisclosure practices. Out of Period Adjustments During fiscal 2014, we determined there was an error in the calculation of deferred taxes on intangible assets pursuant to theacquisition of American Technical Ceramics (“ATC”) Corporation in September of 2007. Accordingly, in fiscal 2014, we recordedan out–of-period adjustment related to the calculation of deferred taxes relative to the fair values of intangible assets at that dateresulting in an increase of $12,240 to deferred income tax liabilities and a corresponding increase to goodwill. The change ingoodwill would not have resulted in an impairment in a prior period. Management performed an evaluation under StaffAccounting Bulletin No. 108 and concluded the effect of the adjustment was immaterial to the current year and prior years’financial statements as there was no impact on prior income statements, cash flows, or retained earnings and the adjustment wasimmaterial to our consolidated balance sheets. During fiscal 2014, we determined there was an error in the calculation of deferred taxes primarily related to property, plantand equipment. As a result, in fiscal 2014, we recorded an increase in deferred tax assets of $4,428 with a corresponding decreasein income tax expense. Management performed an evaluation under Staff Accounting Bulletin No. 108 and concluded the effectof the adjustment was immaterial to the fiscal 2014 and prior year’s financial statements. Cash Equivalents and Investments in Securities: We consider all highly liquid investments purchased with an original maturity of three months (90 days) or less to be cashequivalents. Our short-term and long-term investment securities are accounted for as held-to-maturity securities and are carried atamortized cost. We have the ability and intent to hold these investments until maturity. All income generated from the held-to-maturity securities investments are recorded as interest income. 52 Inventories: We determine the cost of raw materials, work in process, and finished goods inventories by the first-in, first-out (“FIFO”)method. Manufactured inventory costs include material, labor, and manufacturing overhead. Inventories are valued at the lower ofcost or market (realizable value) and are valued at market value where there is evidence that the utility of goods will be less thancost and that such write-down should occur in the current period. Accordingly, at the end of each period, we evaluate ourinventory and adjust to net realizable value. We review and adjust the carrying value of our inventories based on historical usage,customer forecasts received from marketing and sales personnel, customer backlog, certain date code restrictions, technologychanges, demand increases and decreases, market directional shifts, and obsolescence and aging. Property and Equipment: Property and equipment are recorded at cost. Machinery and equipment are generally depreciated on the double‑decliningbalance method. Buildings are depreciated on the straight‑line method. The estimated useful lives used for computing depreciationare as follows: buildings and improvements – 10 to 31.5 years, machinery and equipment – 3 to 10 years. Depreciation expensewas $42,480, $43,731 and $37,073 for the fiscal years ended March 31, 2013, 2014 and 2015, respectively. We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount ofany such assets may not be recoverable. If the sum of the undiscounted cash flows is less than the carrying value of the relatedassets, we recognize an impairment loss, measured as the amount by which the carrying value exceeds the fair value of the assets. The cost of maintenance and repairs is charged to expense as incurred. Upon disposal or retirement, the cost andaccumulated depreciation of assets are eliminated from the respective accounts. Any gain or loss is reflected in our results ofoperations. Goodwill and Acquired Intangible Assets: We do not amortize goodwill and indefinite-lived intangible assets, but test these assets for impairment annually or wheneverconditions indicate that such impairment could exist. The carrying value of goodwill and indefinite-lived intangible assets areevaluated in relation to the operating performance and estimated future discounted cash flows of the related reporting unit. If thesum of the discounted cash flows (excluding interest) is less than the carrying value of the related assets, we recognize animpairment loss, measured as the amount by which the carrying value exceeds the fair value of the assets. The estimate of cashflow is based upon, among other things, certain assumptions about expected future operating performance. Our annual goodwilland indefinite-lived intangible assets impairment analysis indicated that there was no related impairment for the fiscal years endedMarch 31, 2013, 2014, or 2015. During the year ended March 31, 2014, goodwill increased due to the final purchase accounting adjustments of the AsiaTantalum acquisition, as well as an increase of $12,240 for an out-of-period adjustment (described above) and the effects offoreign currency translation. We have determined that our intangible assets have finite useful lives. Intangible assets are amortized on a straight-line basisover their estimated useful lives. Amortization expense was $4,391, $6,478, and $5,141 for the fiscal years ended March 31, 2013,2014, and 2015, respectively. March 31, 2014March 31, 2015 Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortizationAmortized intangible assets:Customer relationships$51,000 $(18,417)$51,000 $(21,250)Developed technology and other13,231 (10,379)13,231 (10,994)Trade name and trademarks34,000 (1,700)34,000 (3,400)Total$98,231 $(30,496)$98,231 $(35,644) 53  The estimated future annual amortization expense for intangible assets is as follows:Fiscal Year ended March 31,Estimated Amortization Expense2016$5,032 20175,032 20184,963 20194,886 20204,841 Thereafter37,833 Pension Assumptions: Pension benefit obligations and the related effects on our results of operations are calculated using actuarial models. Twocritical assumptions, discount rate and expected rate of return on plan assets, are important elements of plan expense and/orliability measurement. We evaluate these assumptions at least annually. The discount rate enables us to state expected future cashflows at a present value on the measurement date. To determine the discount rate, we apply the expected cash flows from eachindividual pension plan to specific yield curves at the plan’s measurement date and determine a level equivalent yield unique toeach plan. A lower discount rate increases the present value of benefit obligations and increases pension expense. To determinethe expected long-term rate of return on pension plan assets, we consider the current and expected asset allocations, as well ashistorical and expected returns on various categories of plan assets. Other assumptions involve demographic factors such asretirement, mortality, and turnover. These assumptions are evaluated at least annually and are updated to reflect our experience.Actual results in any given year will often differ from actuarial assumptions because of economic and other factors. In such cases,the differences between actual results and actuarial assumptions are amortized over future periods. Income Taxes: As part of the process of preparing our consolidated financial statements, we are required to estimate our tax assets andliabilities in each of the jurisdictions in which we operate. This process involves management estimating the actual current taxexposure together with assessing temporary differences resulting from different treatment of items for tax and accountingpurposes. These differences result in deferred tax assets and liabilities that are included within our consolidated balance sheets. Weassess the likelihood that our deferred tax assets will be recoverable based on all available evidence, both positive and negative. Tothe extent we believe that recovery is not more likely than not, we establish a valuation allowance. We have recorded valuation allowances due to uncertainties related to our ability to realize some of our deferred tax assets,primarily consisting of certain net operating losses carried forward before they expire. The valuation allowance is based on ourestimates of future taxable income over the periods that our deferred tax assets will be recoverable. We continue to evaluatecountries where we have a valuation allowance on our deferred tax assets due to historical operating losses and when such positiveevidence outweighs negative evidence we will release such valuation allowance as appropriate. We also record a provision for certain international, federal, and state tax contingencies based on the likelihood of obligation,when needed. In the normal course of business, we are subject to challenges from U.S. and non-U.S. tax authorities regarding theamount of taxes due. These challenges may result in adjustments of the timing or amount of taxable income or deductions or theallocation of income among tax jurisdictions. Further, during the ordinary course of business, other changing facts andcircumstances may impact our ability to utilize tax benefits as well as the estimated taxes to be paid in future periods. We believethat any potential tax exposures have been sufficiently provided for in the consolidated financial statements. In the event thatactual results differ from these estimates, we may need to adjust tax accounts and related payments, which could materially impactour financial condition and results of operations. We account for uncertainty in income taxes recognized in our financial statements. We recognize in our financial statementsthe impact of a tax position, if that position would “more likely than not” be sustained on audit, based on the technical merits ofthe position. Accruals for estimated interest and penalties are recorded as a component of interest expense. 54 We record deferred tax liabilities for temporary differences associated with deductions for foreign branch losses claimed by usin our U.S. income tax returns, as these deductions are subject to recapture provisions in the U.S. income tax code. When therecapture period expires for these deductions, the liabilities are removed and the tax benefit is recognized in the income taxprovision. Foreign Currency Activity: Assets and liabilities of foreign subsidiaries, where functional currencies are their local currencies, are translated into U.S. dollarsat the exchange rate in effect at the balance sheet date. Operating accounts are translated at an average rate of exchange for therespective accounting periods. Translation adjustments result from the process of translating foreign currency financial statementsinto U.S. dollars and are reported separately as a component of accumulated other comprehensive income (loss). Transactiongains and losses reflected in the functional currencies are reported in our results of operations at the time of the transaction. Derivative Financial Instruments: Derivative instruments are reported on the consolidated balance sheets at their fair values. The accounting for changes in fairvalue depends upon the purpose of the derivative instrument and whether it is designated and qualifies for hedge accounting. Forinstruments designated as hedges, the effective portion of gains or losses is reported in other comprehensive income (loss) and isreclassified into the statement of operations in the same period during which the hedged transaction affects our results ofoperations. Any contracts that do not qualify as hedges, for accounting purposes, are marked to market with the resulting gainsand losses recognized in other income or expense. We use financial instruments such as forward exchange contracts to hedge a portion, but not all, of our firm commitmentsdenominated in foreign currencies. The purpose of our foreign currency management is to minimize the effect of exchange ratechanges on actual cash flows from foreign currency denominated transactions. See Note 13 for further discussion of derivativefinancial instruments. Revenue Recognition and Accounts Receivable: All products are built to specification and tested by AVX or our suppliers for adherence to such specification before shipmentto customers. We ship products to customers based upon firm orders. Shipping and handling costs are included in cost of sales.We recognize revenue when the sales process is complete. This occurs when products are shipped to the customer in accordancewith the terms of an agreement of sale, there is a fixed or determinable selling price, title and risk of loss have been transferred,and collectability is reasonably assured. Estimates used in determining sales allowance programs described below are subject to thevolatilities of the marketplace. This includes, but is not limited to, changes in economic conditions, pricing changes, productdemand, inventory levels in the supply chain, the effects of technological change, and other variables that might result in changesto our estimates. Accordingly, there can be no assurance that actual results will not differ from those estimates. Accounts Receivable We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to makerequired payments. The allowance is determined through an analysis of the aging of accounts receivable and assessments of riskthat are based on historical trends and an evaluation of the impact of current and projected economic conditions. We evaluate thepast-due status of trade receivables based on contractual terms of sale. If the financial condition of our customers were todeteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. 55 Returns Sales revenue and cost of sales reported in the statement of operations are reduced to reflect estimated returns. We record anestimated sales allowance for returns at the time of sale based on historical trends, current pricing and volume information, othermarket specific information, and input from sales, marketing, and other key management personnel. The amount accrued reflectsthe return of value of the customer’s inventory. These procedures require the exercise of significant judgments. We believe thatthese procedures enable us to make reliable estimates of future returns. Our actual results have historically approximated ourestimates. When the product is returned and verified, the customer is given credit against their accounts receivable. Distribution Programs A portion of our sales are to independent electronic component distributor customers, which are subject to various distributorsales programs. We report provisions for distributor allowances in connection with such sales programs as a reduction in revenueand report distributor allowances in the balance sheet as a reduction in accounts receivable. For the distribution programsdescribed below, we do not track the individual units that are recorded against specific products sold from distributor inventories,which would allow us to directly compare revenue reduction for credits recorded during any period with credits ultimatelyawarded in respect of products sold during that period. Nevertheless, we believe that we have an adequate basis to assess thereasonableness and reliability of our estimates for each program. Distributor Stock Rotation Program Stock rotation is a program whereby distributor customers are allowed to return for credit qualified inventory, semi-annually,equal to a certain percentage, primarily limited to 5% of the previous six months net sales. We record an estimated sales allowancefor stock rotation at the time of sale based on a percentage of distributor sales using historical trends, current pricing and volumeinformation, other market specific information, and input from sales, marketing, and other key management personnel. Theseprocedures require the exercise of significant judgments. We believe that these procedures enable us to make reliable estimates offuture returns under the stock rotation program. Our actual results have historically approximated our estimates. When theproduct is returned and verified, the distributor is given credit against their accounts receivable. Distributor Ship-from-Stock and Debit Program Ship-from-Stock and Debit (“ship and debit”) is a program designed to assist distributor customers in meeting competitiveprices in the marketplace on sales to their end customers. Ship and debit programs require a request from the distributor for apricing adjustment for a specific part for a sale to the distributor’s end customer from the distributor’s stock. Ship and debitauthorizations may cover current and future distributor activity for a specific part for sale to their customer. At the time we recordsales to the distributors, we provide an allowance for the estimated future distributor activity related to such sales since it isprobable that such sales to distributors will result in ship and debit activity. We record an estimated sales allowance based on salesduring the period, credits issued to distributors, distributor inventory levels, historical trends, market conditions, pricing trends wesee in our direct sales activity with original equipment manufacturers and other customers, and input from sales, marketing, andother key management personnel. These procedures require the exercise of significant judgments. We believe that theseprocedures enable us to make reliable estimates of future credits under the ship and debit program. Our actual results havehistorically approximated our estimates. At the time the distributor ships the part from stock, the distributor debits us for theauthorized pricing adjustment. Special Incentive Programs We may offer special incentive discounts based on amount of product ordered or shipped. At the time we record sales underthese agreements, we provide an allowance for the discounts on the sales for which the customer is eligible. The customer thendebits us for the authorized discount amount. Research, Development, and Engineering: Research, development, and engineering expenditures are expensed when incurred. Research and development expenses areincluded in selling, general, and administrative expenses and were $7,150, $10,514, and $11,951 for the fiscal years ended March31, 2013, 2014, and 2015, respectively. Engineering expenses are included in cost of sales and selling, general, and administrativeexpenses as follows:56  Fiscal Year Ended March 31, 201320142015Engineering expense:Cost of sales$22,876 $15,726 $13,439 Selling, general, and administrative expense441 - -Total engineering expense$23,317 $15,726 $13,439 Stock‑Based Compensation: We recognize compensation cost resulting from all share-based payment transactions in the financial statements. The amountof compensation cost is measured based on the grant-date fair value for the share-based payment issued. Our policy is to grantstock options with an exercise price equal to our stock price on the date of grant. Compensation cost is recognized over thevesting period of the award. We use the Black-Scholes-Merton option-pricing model to determine the fair value of options at the grant date. See Note 11for assumptions used. Treasury Stock: Our Board of Directors have approved stock repurchase authorizations in 2005 and 2007 whereby up to 10,000 shares ofcommon stock could be purchased from time to time at the discretion of management. Accordingly, 984 shares were purchasedduring the fiscal year ended March 31, 2013, 799 shares were purchased during the fiscal year ended March 31, 2014, and 525shares were purchased during the fiscal year ended March 31, 2015. We purchased 203 shares of common stock during the fourthquarter of the fiscal year ended March 31, 2015. As of March 31, 2015, we had in treasury 8,178 common shares at a cost of$104,608. There are 4,185 shares that may yet be purchased under this the 2007 authorization. Commitments and Contingencies: Liabilities for loss contingencies are recorded when analysis indicates that it is both probable that a liability has been incurredand the amount of loss can be reasonably estimated. When a range of loss can be estimated, we accrue the most likely amount. Inthe event that no amount in the range of probable loss is considered most likely, the minimum loss in the range isaccrued. Amounts recorded are reviewed periodically and adjusted to reflect additional legal and technical information thatbecomes available. Legal costs are expensed as incurred. New Accounting Standards: In April 2014, the FASB issued changes to the criteria for determining which disposals are required to be presented asdiscontinued operations. The changes require a disposal of a component of an entity or a group of components of an entity tobe reported in discontinued operations if the disposal represents a strategic shift that has, or will have, a major effect on an entity’soperations and financial results when any of the following occurs: (i) the component of an entity or group of components of anentity meets the criteria to be classified as held for sale, (ii) the component of an entity or group or components of an entity isdisposed of by sale, or (iii) the component of an entity or group of components of an entity is disposed of other than by sale.The amendments apply on a prospective basis to disposals of components of an entity that occur within annual periodsbeginning on or after December 15, 2014 and interim periods within those years, with early adoption permitted. Theimplementation of the amended accounting guidance on January 1, 2015 did not have a material impact on our consolidatedfinancial statements. 57 In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” This guidance modifies thefinancial reporting of revenue and how an entity will determine the measurement of revenue and timing of when it is recognized.The guidance provides for a five-step approach in applying the standard: 1) identifying the contract with the customer, 2)identifying separate performance obligations in the contract, 3) determining the transaction price, 4) allocating the transactionprice to separate performance obligations, and 5) recognizing the revenue when the performance obligation has been satisfied.The new guidance requires enhanced disclosures for the nature, amount, timing, and uncertainty of revenue that is beingrecognized. The guidance is effective for public companies for interim and annual reporting periods beginning after December15, 2016. Companies may use either a full retrospective or a modified retrospective approach to adopt ASU 2014-09. Earlyadoption is not permitted. Management is currently evaluating the impact of this guidance on our consolidated financialstatements. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40);Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” This update requires management toevaluate whether there is substantial doubt about the Company’s ability to continue as a going concern. This update is effective forthe annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The implementation of thisstandard is not expected to have an impact on our consolidated financial statements upon adoption. We have reviewed other newly issued accounting pronouncements and concluded that they are either not applicable to ourbusiness or that no material effect is expected on our consolidated financial statements as a result of future adoption. 2. Earnings Per Share: Basic earnings per share are computed by dividing net earnings by the weighted average number of shares of common stockoutstanding for the period. Diluted earnings per share are computed by dividing net earnings by the sum of (a) the weightedaverage number of shares of common stock outstanding during the period and (b) the dilutive effect of potential common stockequivalents during the period. Stock options are the only common stock equivalents and are computed using the treasury stockmethod. The table below represents the basic and diluted earnings per share, calculated using the weighted average number of sharesof common stock and potential common stock equivalents outstanding for the years ended March 31, 2013, 2014, and 2015: Fiscal Year Ended March 31, 201320142015Net income (loss)(64,312)$127,037 $225,871 Computation of Basic EPS:Weighted Average Shares Outstanding used in Computing Basic EPS169,124 168,473 168,148 Basic earnings (loss) per share$(0.38)$0.75 $1.34 Computation of Diluted EPS:Weighted Average Shares Outstanding used in Computing Basic EPS169,124 168,473 168,148 Effect of stock options -185 254 Weighted Average Shares used in Computing Diluted EPS 169,124 168,658 168,402 Diluted earnings (loss) per share$(0.38)$0.75 $1.34 (1) Common stock equivalents not included in the computation of diluted earnings per share because the impact would have been anti-dilutive were3,847 shares, 2,942 shares, and 2,309 shares for the fiscal years ended March 31, 2013, 2014, and 2015, respectively. In addition, 50 shares of commonstock equivalents that would have been dilutive if we had income were excluded from the computation of diluted earnings per share due to theCompany’s net loss position for the fiscal year ended March 31, 2013.58 (1) 3. Comprehensive Income: Comprehensive income (loss) includes the following components: Fiscal Year Ended March 31, 201320142015 Pre-taxNet ofTaxPre-taxNet ofTaxPre-taxNet of TaxForeign currency translation adjustment$(10,249)$(10,249)$4,670 $4,670 $(64,734)$(64,734)Foreign currency cash flow hedges adjustment413 356 1,149 933 10 (2)Pension liability adjustment(18,600)(13,801)9,791 6,854 (9,930)(7,494)Other post-employment obligations - - - -(2,561)(2,561)Other comprehensive income (loss)$(28,436)$(23,694)$15,610 $12,457 $(77,215)$(74,791) The accumulated balance of comprehensive income (loss) is as follows: As of March 31, 20142015Foreign currency translation adjustment$50,748 $(13,986)Foreign currency cash flow hedges adjustment184 182 Pension liability adjustment(42,806)(50,300)Other post-employment obligations -(2,561)Accumulated other comprehensive income (loss)$8,126 $(66,665) 4. Fair Value:Fair Value Hierarchy:The fair value framework requires the categorization of assets and liabilities into three levels based upon the assumptions(inputs) used to value the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generallyrequires significant management judgment. The three levels are defined as follows: §Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities. §Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar assets or liabilitiesin active markets or quoted prices for identical assets or liabilities in inactive markets. §Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset orliability.59  During the fiscal years ended March 31, 2013, 2014, and 2015, there have been no transfers of assets between the levels within thefair value hierarchy. Based on QuotedpricesOther in activeobservableUnobservable Fair Value atmarketsinputsinputs March 31, 2014(Level 1)(Level 2)(Level 3)Assets measured at fair value on a recurring basis:Assets held in the non-qualified deferred compensationprogram$7,915 $7,915 $ -$ -Foreign currency derivatives564 -564 -Total$8,479 $7,915 $564 $ - Based on QuotedpricesOther in activeobservableUnobservable Fair Value atmarketsinputsinputs March 31, 2014(Level 1)(Level 2)(Level 3)Liabilities measured at fair value on a recurring basis:Obligation related to assets held in the non-qualifieddeferred compensation program$7,915 $7,915 $ -$ -Foreign currency derivatives433 -433 -Total$8,348 $7,915 $433 $ - Based on QuotedpricesOther in activeobservableUnobservable Fair Value atmarketsinputsinputs March 31, 2015(Level 1)(Level 2)(Level 3)Assets measured at fair value on a recurring basis:Assets held in the non-qualified deferred compensationprogram$8,636 $8,636 $ -$ -Foreign currency derivatives1,279 -1,279 -Total$9,915 $8,636 $1,279 $ - 60 (1)(2)(1)(2)(1)(2) Based on QuotedpricesOther in activeobservableUnobservable Fair Value atmarketsinputsinputs March 31, 2015(Level 1)(Level 2)(Level 3)Liabilities measured at fair value on a recurring basis:Obligation related to assets held in the non-qualifieddeferred compensation program$8,636 $8,636 $ -$ -Foreign currency derivatives1,170 -1,170 -Total$9,806 $8,636 $1,170 $ - (1) The market value of the assets held in the trust for the non-qualified deferred compensation program is included as an asset and as a liability as the trust’sassets are both assets of the Company and also a liability as they are available to general creditors in certain circumstances. (2) Foreign currency derivatives in the form of forward contracts are included in prepaid and other in the March 31, 2014 and 2015 consolidated balance sheets.Unrealized gains and losses on derivatives classified as cash flow hedges are recorded in other comprehensive income (loss). Realized gains and losses onderivatives classified as cash flow hedges and gains and losses on derivatives not designated as hedges are recorded in other income. Valuation Techniques: The following describes valuation techniques used to value our assets held in the non-qualified deferred compensation planand derivatives. Assets held in the non-qualified deferred compensation plan Assets valued using Level 1 inputs in the table above represent assets from our non-qualified deferred compensation program.The funds in the non-qualified deferred compensation program are valued based on the number of shares in the funds using aprice per share traded in an active market. Investments are considered to be impaired when a decline in fair value is judged to be other-than-temporary. If the cost of aninvestment exceeds its fair value, among other factors, we evaluate general market conditions, the duration and extent to whichthe fair value is less than cost, our intent and ability to hold the investment, and whether or not we expect to recover the security’sentire amortized cost. Once a decline in fair value is determined to be other-than-temporary, an impairment charge is recordedand a new cost basis in the investment is established. Derivatives We primarily use forward contracts, with maturities generally less than four months, designated as cash flow hedges to protectagainst the foreign currency exchange rate risks inherent in forecasted transactions related to purchase commitments and sales,denominated in various currencies. We also use derivatives not designated as hedging instruments to hedge foreign currencybalance sheet exposures. These derivatives are used to offset currency changes in the fair value of the hedged assets and liabilities.Fair values for all of our derivative financial instruments are valued by adjusting the market spot rate by forward points, based onthe date of the contract. The spot rates and forward points used are an average rate from an actively traded market. At March 31,2014 and 2015, all of our forward contracts have been designated as Level 2 measurements.61 (1)(2) 5. Accounts Receivable: Fiscal Year Ended March 31, 20142015Trade$230,321 $209,838 Less:Allowances for doubtful accounts410 659 Ship from stock and debit and stock rotation17,138 16,378 Sales returns and discounts6,356 6,186 Total allowances23,904 23,223 $206,417 $186,615 Charges related to allowances for doubtful accounts are charged to selling, general, and administrative expenses. Chargesrelated to stock rotation, ship from stock and debit, sales returns, and sales discounts are reported as deductions from revenue. Fiscal Year Ended March 31, 201320142015Allowances for doubtful accounts:Beginning Balance$720 $705 $410 Charges127 43 704 Applications(142)(338)(455)Ending Balance$705 $410 $659 Fiscal Year Ended March 31, 201320142015Ship from stock and debit and stock rotation:Beginning Balance$14,327 $14,771 $17,138 Charges34,305 40,676 33,634 Applications(33,861)(38,309)(34,394)Translation and other - - -Ending Balance$14,771 $17,138 $16,378 Fiscal Year Ended March 31, 201320142015Sales returns and discounts:Beginning Balance$7,179 $5,486 $6,356 Charges18,477 22,608 20,524 Applications(20,129)(21,782)(20,468)Translation and other(41)44 (226)Ending Balance$5,486 $6,356 $6,186 62  6. Inventories: Fiscal Year Ended March 31, 20142015Finished goods$109,053 $102,212 Work in process109,315 106,627 Raw materials and supplies332,150 327,073 $550,518 $535,912 7. Property and Equipment: Fiscal Year Ended March 31, 20142015Land$43,325 $37,461 Buildings and improvements348,168 294,577 Machinery and equipment1,233,914 1,128,683 Construction in progress11,389 7,216 1,636,796 1,467,937 Accumulated depreciation(1,401,071)(1,268,095) $235,725 $199,842 8. Financial Instruments and Investments in Securities: Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents,securities investments, and trade accounts receivable. We place our cash and cash equivalents with high credit qualityinstitutions. At times, such investments may be in excess of the Federal Deposit Insurance Corporation insurance limit.Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of entities comprisingour customer base and their dispersion across many different industries and countries. As of March 31, 2015, we believe that ourcredit risk exposure is not significant. At March 31, 2014 and 2015 we classified investments in debt securities and time deposits as held-to-maturity securities. Our long-term and short-term investment securities are accounted for as held-to-maturity securities and are carried atamortized cost. We have the ability and intent to hold these investments until maturity. All income generated from the held-to-maturity securities investments is recorded as interest income. 63 Investments in held-to-maturity securities, recorded at amortized cost, were as follows: As of March 31, 2014 CostGrossUnrealizedGainsGross UnrealizedLossesEstimated FairValueShort-term investments:Commercial paper$ -$ -$ -$ -Corporate bonds40,838 75 -40,913 Time deposits372,777 245 -373,022 Long-term investments:Corporate bonds25,000 13 -25,013 $438,615 $333 $ -$438,948 As of March 31, 2015 CostGrossUnrealizedGainsGrossUnrealizedLossesEstimated FairValueShort-term investments:Commercial Paper$34,493 $ -$(13)$34,480 Corporate bonds2,517 - -2,517 Time deposits424,891 227 -425,118 Long-term investments:Corporate bonds150,029 51 (53)150,027 $611,930 $278 $(66)$612,142 The amortized cost and estimated fair value of held-to-maturity investments at March 31, 2015, by contractual maturity, areshown below. The estimated fair value of these investments are based on valuation inputs that include benchmark yields, reportedtrades, broker and dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data, whichare Level 2 inputs in the fair value hierarchy. Actual maturities may differ from contractual maturities because issuers may have theright to call or prepay obligations without call or prepayment penalties. Held-to-Maturity Amortized CostEstimated FairValueDue in one year or less$461,901 $462,115 Due after one year through five years150,029 150,027 Total$611,930 $612,142 64 9. Income Taxes: For financial reporting purposes, income (loss) before income taxes includes the following components: Fiscal Year Ended March 31, 201320142015Domestic$(192,584)$83,837 $114,333 Foreign79,262 79,520 104,266 $(113,322)$163,357 $218,599 The provision for (benefit from) income taxes consisted of: Fiscal Year Ended March 31, 201320142015Current:Federal/State$19,116 $(53,100)$27,620 Foreign9,712 18,325 22,189 28,828 (34,775)49,809 Deferred:Federal/State(81,632)72,028 (5,684)Foreign3,794 (933)(51,397) (77,838)71,095 (57,081) $(49,010)$36,320 $(7,272) Deferred taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities forfinancial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assetsand liabilities are as follows: As of March 31, 20142015Current:AssetsLiabilitiesAssetsLiabilitiesSales and receivable allowances$8,387 $50 $8,452 $ -Inventory reserves14,530 1,320 14,376 356 Accrued expenses and other13,286 112 57,881 80 Sub total36,203 1,482 80,709 436 Less: valuation allowances(3,780) -(3,734) -Total Current$32,423 $1,482 $76,975 $436 65  As of March 31, 20142015Non-current:AssetsLiabilitiesAssetsLiabilitiesDepreciation and amortization$11,768 $8,618 $9,928 $10,144 Foreign branch goodwill amortization -10,454 - -Pension obligations14,944 7,824 17,348 7,936 Accrued expenses50,303 -7,928 -Other, net3,017 36 4,160 51 Net operating loss and tax credit carry forwards101,995 -75,746 -Sub total182,027 26,932 115,110 18,131 Less: valuation allowances(95,021) -(23,473) -Total Non-current$87,006 $26,932 $91,637 $18,131 As of March 31, 20142015Assets, net of valuation allowances$119,429 $168,612 Liabilities(28,414)(18,567)Net deferred income tax assets$91,015 $150,045 As of March 31, 201320142015Valuation allowance beginning balance$72,781 91,541 98,801 Charged to costs and expenses3,651 1,227 (1,910)Additions19,479 - -Releases - -(50,111)Translation and other(4,370)6,033 (19,573)Valuation allowance ending balance$91,541 $98,801 $27,207 Amounts included in our consolidated balance sheets: As of March 31, 20142015Current assets$31,896 $76,963 Current liabilities(952)(424)Noncurrent assets65,524 79,276 Noncurrent liabilities(5,453)(5,770)Net deferred income tax assets$91,015 $150,045 66 Reconciliation between the U.S. Federal statutory income tax rate and our effective rate for income tax is as follows: Fiscal Year Ended March 31, 201320142015U.S. Federal statutory rate35.0%35.0%35.0%Increase (decrease) in tax rate resulting from:State income taxes, net of federal benefit1.40.60.6Effect of foreign operations10.1(7.6)(6.0)Change in valuation allowance0.10.9(22.4)Deemed dividends from subsidiaries(4.6)2.81.8Deduction for domestic production activities2.4 -(1.3)Utilization of foreign tax credits2.6(1.7)(1.2)Branch accounting restructuring - -(6.5)Change in uncertain tax positions -(3.8)(0.6)Adjustment of prior year balances -(2.3) -Other, net(3.8)(1.7)(2.7)Effective tax rate43.2%22.2%-3.3% At March 31, 2015, certain of our foreign subsidiaries in Brazil, France, Germany, Israel, China, and Japan had tax netoperating loss carry forwards totaling approximately $224,104 of which most had no expiration date. There is a greater likelihoodof not realizing the future tax benefits of these net operating losses and other deductible temporary differences in Brazil, Israel,China, and Japan since these losses and other deductible temporary differences must be used to offset future taxable income ofthose subsidiaries, which cannot be assured, and are not available to offset taxable income of other subsidiaries located in thosecountries. Accordingly, we have recorded valuation allowances related to the net deferred tax assets in these jurisdictions. Valuationallowances increased (decreased) $18,761, $7,250, and $(71,583) during the years ended March 31, 2013, 2014, and 2015,respectively, as a result of changes in the net operating losses of the subsidiaries in the countries mentioned above. The decrease invaluation allowance during the year ended March 31, 2015 was also due to the reversal of valuation allowances of $49,969 relatedto the future utilization of NOLs totaling $149,922 at a French subsidiary. The related tax benefits upon utilization of the NOLsare un-expiring; however, they are subject to annual utilization limitations. The realization of tax benefits due to the utilization ofthese NOLs could take an extended period of time to realize and are dependent upon the French subsidiary’s continuingprofitability. At the present time, we expect that cash and profits generated by our foreign subsidiaries will continue to be reinvestedindefinitely. We do not provide for U.S. taxes on the undistributed earnings of foreign subsidiaries which are considered to bereinvested indefinitely. The amount of U.S. taxes on such undistributed earnings as of March 31, 2014 and 2015 would havebeen $180,960 and $186,676, respectively.Income taxes paid totaled $43,920, $27,514 and $56,389 during the years ended March 31, 2013, 2014 and 2015, respectively. We do not expect that the balances with respect to our uncertain tax positions will significantly increase or decrease within thenext 12 months. For our more significant locations, we are subject to income tax examinations for the tax years 2011 andforward in the United States, 2011 and forward in Germany, 2009 and forward in Hong Kong, and 2009 and forward in theUnited Kingdom. 67 A reconciliation of the beginning and ending balance for liabilities associated with uncertain tax positions is as follows: Balance at March 31, 2012$13,156 Additions for tax positions of prior years1,068 Additions for tax positions in current period400 Reductions for tax positions of prior years(12)Reductions due to expiration of statutes(38)Reductions due to settlements with taxing authorities(372)Balance at March 31, 2013$14,202 Additions for tax positions of prior years615 Additions for tax positions in current period75 Reductions for tax positions of prior years(1,124)Reductions due to expiration of statutes(5,521)Reductions due to settlements with taxing authorities(164)Balance at March 31, 2014$8,083 Additions for tax positions of prior years564 Additions for tax positions in current period257 Reductions for tax positions of prior years(55)Reductions due to expiration of statutes(1,687)Reductions due to settlements with taxing authorities(386)Balance at March 31, 2015$6,776 We recognize interest and penalties related to uncertain tax positions in interest expense. As of March 31, 2014 and 2015, wehad accrued interest and penalties related to uncertain tax positions of $1,155 and $1,234, respectively. During the year endedMarch 31, 2014 and 2015, we recognized $(471) and $88, respectively, in interest and penalties. The amount of unrecognized tax benefits recorded on our balance sheet that, if recognized, would affect the effective tax rateis approximately $8,083 and $6,776 at March 31, 2014 and 2015, respectively. This amount excludes the accrual for estimatedinterest discussed above. 10. Employee Retirement Plans: Pension Plans: We sponsor various defined benefit pension plans covering certain employees. Pension benefits provided to certain U.S.employees covered under collective bargaining agreements are based on a flat benefit formula. Effective December 31, 1995, wefroze benefit accruals under our domestic non‑contributory defined benefit pension plan for a significant portion of theemployees covered under collective bargaining agreements. Our pension plans for certain international employees provide forbenefits based on a percentage of final pay. Our funding policy is to contribute amounts sufficient to meet minimum fundingrequirements as set forth in employee benefit and tax laws. We recognize the overfunded or underfunded status of our defined benefit postretirement plans as an asset or liability in ourstatement of financial position and recognize changes in that funded status in the year in which the changes occur throughcomprehensive income. The adjustment to our pension liability due to the change in the funded status of our plans resulted in adecrease in recorded pension liabilities by $17,646 during the fiscal year ended March 31, 2014, and an increase in recordedpension liabilities by $4,145 during the fiscal year ended March 31, 2015. 68 The change in the benefit obligation and plan assets of the U.S. and international defined benefit plans for 2014 and 2015were as follows: Fiscal Year Ended March 31, U.S. PlansInternational Plans 2014201520142015Change in benefit obligation:Benefit obligation at beginning of year$40,315 $39,282 $162,691 $169,575 Service cost466 196 1,017 903 Interest cost1,560 1,588 6,902 6,238 Plan participants' contributions - -85 49 Actuarial loss (gain)(1,181)6,036 (8,008)25,376 Benefits paid(1,878)(1,859)(6,660)(6,164)Foreign currency exchange rate changes - -13,548 (19,038)Benefit obligation at end of year$39,282 $45,243 $169,575 $176,939 Change in plan assets:Fair value of plan assets at beginning of year$34,922 $36,058 $131,637 $153,998 Actual return on assets3,014 1,401 8,660 21,913 Employer contributions -2,116 9,126 8,074 Plan participants' contributions - -85 49 Benefits paid(1,878)(1,859)(6,660)(6,164)Foreign currency exchange rate changes - -11,150 (16,350)Fair value of plan assets at end of year36,058 37,716 153,998 161,520 Funded status$(3,224)$(7,527)$(15,577)$(15,419) The accumulated benefit obligation at March 31, 2014 and 2015 was $208,767 and $222,076 respectively. At March 31, 2015, the accumulated benefit obligation exceeded the fair value of the assets for all of the U.S. defined benefitplans and all but one of the international defined benefit plans. Our assumptions used in determining the pension assets and liabilities were as follows: As of March 31, 20142015Assumptions:Discount rates1.0-4.5%0.5-3.5%Increase in compensation3.9%3.4% The following table shows changes in accumulated comprehensive income, excluding the effect of income taxes, related toamounts recognized in other comprehensive income during fiscal 2014 and 2015 and amounts reclassified to the statement ofoperations as a component of net periodic pension cost during fiscal 2014 and 2015.69  Fiscal Year Ended March 31, U.S. PlansInternational Plans 2014201520142015Beginning balance$14,104 $10,953 $52,703 $45,461 Net loss (gain) incurred during the year(2,015)6,844 (9,826)11,391 Amortization of net loss (gain)(1,136)(804)(2,613)(1,885)Amortization of prior service cost - - - -Foreign currency exchange - -5,197 (5,347) $10,953 $16,993 $45,461 $49,620 Amounts that have not yet been recognized as components of net periodic pension cost (as a component of accumulatedcomprehensive income (loss) at March 31, 2014 and 2015) are as follows: Fiscal Year Ended March 31, U.S. PlansInternational Plans 2014 (1)2015 (2)2014 (1)2015 (2)Unrecognized net actuarial loss$6,996 $10,876 $35,775 $39,424 Unamortized prior service cost - - - - $6,996 $10,876 $35,775 $39,424 (1) Amounts in the above table as of March 31, 2014 are net of $3,957 and $9,686 tax benefit for the U.S. Plans and for theInternational Plans, respectively. (2) Amounts in the above table as of March 31, 2015 are net of $6,117 and $10,219 tax benefit for the U.S. Plans and for theInternational Plans, respectively. The March 31, 2015 balance of unrecognized net actuarial losses expected to be amortized in fiscal 2016 is $1,551 for the U.S.Plans and $2,119 for the International Plans, respectively. Net pension cost related to these pension plans includes the following components: Fiscal Year Ended March 31, 201320142015Service cost$954 $1,473 $1,175 Interest cost7,957 8,176 8,361 Expected return on plan assets(8,333)(9,022)(10,137)Amortization of prior service cost7 - -Recognized actuarial loss2,563 3,749 2,689 Net periodic pension cost$3,148 $4,376 $2,088 Our assumptions used in determining the net periodic pension expense were as follows: As of March 31, 201320142015Assumptions:Discount rates1.0-5.0%1.0-4.2%1.0-4.5%Increase in compensation3.8%3.9%3.9%Expected long-term rate of return on plan assets1.4-7.3%1.4-7.3%1.4-7.3% 70  The pension expense is calculated based upon a number of actuarial assumptions established annually for each plan year,detailed in the table above, including discount rate, rate of increase in future compensation levels, and expected long-term rate ofreturn on plan assets. To determine the discount rate, we apply the expected cash flows from each individual pension plan tospecific yield curves at the plan’s measurement date and determine a level equivalent yield that may be unique to each plan. On thatbasis, the range of discount rates decreased 0.3% from March 31, 2014 to March 31, 2015. The fair value of pension assets at March 31, 2014 and 2015 was determined using: Based on QuotedpricesOther in activeobservableUnobservable Fair Value atmarketsinputsinputs March 31, 2014(Level 1)(Level 2)(Level 3)Assets measured at fair value on a recurring basis:U.S. Defined Benefit Plan Assets:Cash$147 $147 $ -$ -Pooled Separate Accounts32,806 -32,806 -Guaranteed Deposit Account3,105 -3,105 - International Defined Benefit Plan Assets:Cash689 689 - -Depository Account8,389 8,389 - -Pooled Separate Accounts144,920 -144,920 -Total$190,056 $9,225 $180,831 $ - Based on QuotedpricesOther in activeobservableUnobservable Fair Value atmarketsinputsinputs March 31, 2015(Level 1)(Level 2)(Level 3)Assets measured at fair value on a recurring basis:U.S. Defined Benefit Plan Assets:Cash$148 $148 $ -$ -Pooled Separate Accounts28,738 -28,738 -Guaranteed Deposit Account8,830 -8,830 - International Defined Benefit Plan Assets:Cash362 362 - -Depository Account7,464 7,464 - -Pooled Separate Accounts153,694 -153,694 -Total$199,236 $7,974 $191,262 $ - Assets valued using Level 1 inputs in the table above are cash and an interest-bearing depository account. Assets valued using Level 2 inputs in the table above are investments held in pooled separate accounts and a guaranteeddeposit account. See discussion in the “Valuation of Investments” section below. 71 Valuation of Investments Our investments are held in a Depository Account, Pooled Separate Accounts, and a Guaranteed Deposit Account. Assetsheld in the Depository Account are cash and cash equivalents. Investments held in the Pooled Separate Accounts are based on thefair value of the underlying securities within the fund, which represent the net asset value, a practical expedient to fair value, of theunits held by the pension plan at year-end. Those assets held in the Guaranteed Deposit Account are valued at the contract valueof the account, which approximates fair value. The contract value represents contributions plus accumulated interest at thecontract rate, less benefits paid to participants, contract administration fees, and other direct expenses. The expected long-term rate of return on plan assets assumption is based upon actual historical returns and futureexpectations for returns for each asset class. These expected results were adjusted for payment of reasonable expenses from planassets. Our long-term strategy is for target allocation of 50% equity and 50% fixed income for our U.S. defined benefit plans and45% equity and 55% fixed income for our international defined benefit plans. Our pension plans’ weighted average asset allocations at March 31, 2014 and 2015, by asset category are as follows: As of March 31, 2014As of March 31, 2015Asset CategoryU.S. PlansInternationalPlansU.S. PlansInternationalPlansEquity securities51%43%56%42%Debt securities40%51%20%53%Other9%6%24%5% Total100%100%100%100% We make contributions to our defined benefit plans as required under various pension funding regulations. We expect tomake contributions of approximately $7,200 to the international plans in fiscal 2016 based on current actuarial computations. Estimated future benefit payments are as follows: Fiscal Year ended March 31,U.S. PlansInternational Plans2016$1,952 $5,856 20172,023 5,982 20182,109 6,106 20192,239 6,234 20202,347 6,360 2021-202512,923 33,712 Savings Plans: We sponsor retirement savings plans, which allow eligible employees to defer part of their annual compensation. Certaincontributions by us are discretionary and are determined by our Board of Directors each year. Our contributions to the savingsplans in the United States and Europe for the fiscal years ended March 31, 2013, 2014 and 2015 were approximately $4,145,$4,074, and $4,000, respectively. 72 We also sponsor a nonqualified deferred compensation program, which permits certain employees to annually elect to defera portion of their compensation until retirement. A portion of the deferral is subject to a matching contribution by us. Theemployees select among various investment alternatives, which are the same as are available under the retirement savings plans,with the investments held in a separate trust. The value of the participants’ balances fluctuate based on the performance of theinvestments. The market value of the trust at March 31, 2014 and 2015 of $7,915 and $8,636, respectively, is included as an assetand a liability in our accompanying balance sheet because the trust’s assets are both assets of the Company and also a liability asthey are available to general creditors in certain circumstances. 11. Stock Based Compensation: We have six fixed stock option plans. Under the 1995 Stock Option Plan, as amended, we could grant options to employeesfor the purchase of up to an aggregate of 9,300 shares of common stock. Under the Non‑Employee Directors’ Stock OptionPlan, as amended, we could grant options for the purchase of up to an aggregate of 650 shares of common stock. No awardswere made under these two plans after August 1, 2005. Under the 2004 Stock Option Plan, as amended, we may grant options toemployees for the purchase of up to an aggregate of 10,000 shares of common stock. Under the 2004 Non‑Employee Directors’Stock Option Plan, as amended, we may grant options for the purchase of up to an aggregate of 1,000 shares of commonstock. In July of 2013, the Board and the Company’s shareholders approved the adoption of the 2014 Stock Option Plan, underwhich we could grant options to employees for the purchase of up to an aggregate of 10,000 shares of common stock as well asthe 2014 Non-Employee Directors’ Stock Option Plan, under which we could grant options to our directors for the purchase ofup to an aggregate of 1,000 shares of common stock. Under all plans, the exercise price of each option shall not be less than themarket price of our stock on the date of grant and an option’s maximum term is 10 years. Options granted under the 1995 StockOption Plan, 2004 Stock Option Plan, and the 2014 Stock Option Plan vest as to 25% annually and options granted under theNon-Employee Directors’ Stock Option Plan, 2004 Non‑Employee Directors’ Stock Option Plan, and the 2014 Non-EmployeeDirector’s Stock Option Plan vest as to one-third annually. Requisite service periods related to all plans begin on the grantdate. As of March 31, 2015, there were 21,435 shares of common stock available for future issuance under all of the plans,consisting of options available to be granted and options currently outstanding. Activity under our stock option plans is summarized as follows: Number ofSharesAverage Price(a)Average Life(years) (b)AggregateIntrinsic ValueOutstanding at March 31, 20144,171 $13.34 - -Options granted513 13.32 - -Options exercised(495)11.47 -$1,376 Options cancelled/forfeited(607)14.28 -106 Outstanding at March 31, 20153,582 $13.45 5.31 $4,859 Exercisable at March 31, 20152,630 $13.82 4.26 $3,064 (a)Weighted-average exercise price(b)Weighted-average contractual life remaining The total aggregate intrinsic value of options exercised is $27, $654, and $1,376 for fiscal years ended March 31, 2013, 2014,and 2015, respectively. 73 Unvested share activity under our stock option plans for the year ended March 31, 2015 is summarized as follows: Number ofSharesWeightedAverage Grant-Date Fair ValueUnvested balance at March 31, 20141,273 $2.44 Options granted513 2.75 Options cancelled/forfeited(97)2.50 Options vested(737)2.57 Unvested balance at March 31, 2015952 $2.50 The total unrecognized compensation costs related to unvested awards expected to be recognized over the vesting period,approximately four years, was $842 and $778 as of March 31, 2014 and 2015, respectively. The total aggregate fair value ofoptions vested is $1,552, $1,365, and $1,894 for fiscal years ended March 31, 2013, 2014, and 2015, respectively. The weighted average estimated fair value of our stock options granted at grant date market prices was $2.09, $2.25, and $2.75per option during fiscal years ended March 31, 2013, 2014, and 2015, respectively. The consolidated statement of operationsincludes $957, net of $515 of tax benefit, in stock-based compensation expense for fiscal 2015. Our weighted average fair value is estimated at the date of grant using a Black-Scholes-Merton option-pricing model. Weestimated volatility by considering our historical stock volatility. We calculated the dividend yield based on historical dividendspaid. We have estimated forfeitures in determining the weighted average fair value calculation. The forfeiture rate used for thefiscal year ended March 31, 2015 was 7.3%. The following are significant weighted average assumptions used for estimating thefair value of options issued under our stock option plans: 201320142015 GrantsGrantsGrantsExpected life (years)666Interest rate1.0%1.0%2.0%Volatility28%29%27%Dividend yield2.8%3.1%2.9% 12. Commitments and Contingencies: We are a lessee under long‑term operating leases primarily for office space, plant and equipment. Future minimum leasecommitments under non‑cancelable operating leases as of March 31, 2015, were as follows: Fiscal Year ended March 31,2016$5,257 20174,105 20183,204 20193,073 20203,047 Thereafter1,672 Rental expense for operating leases was $7,382, $7,333, and $6,759 for the fiscal years ended March 31, 2013, 2014, and 2015,respectively. 74 From time to time we enter into delivery contracts with selected suppliers for certain metals used in our production processes.The delivery contracts represent routine purchase orders for delivery within three months and payment is due upon receipt. As ofMarch 31, 2015, we had no significant outstanding purchase commitments. We have been identified by the United States Environmental Protection Agency (“EPA”), state governmental agencies orother private parties as a potentially responsible party (“PRP”) under the Comprehensive Environmental Response,Compensation and Liability Act (“CERCLA”) or equivalent state or local laws for clean-up and response costs associated withcertain sites at which remediation is required with respect to prior contamination. Because CERCLA or such state statutesauthorize joint and several liability, the EPA or state regulatory authorities could seek to recover all clean-up costs from any one ofthe PRPs at a site despite the involvement of other PRPs. At certain sites, financially responsible PRPs other than AVX also are, orhave been, involved in site investigation and clean-up activities. We believe that liability resulting from these sites will beapportioned between AVX and other PRPs. To resolve our liability at the sites at which we have been named a PRP, we have entered into various administrative ordersand consent decrees with federal and state regulatory agencies governing the timing and nature of investigation and remediation.As is customary, the orders and decrees regarding sites where the PRPs are not themselves implementing the chosen remedycontain provisions allowing the EPA to reopen the agreement and seek additional amounts from settling PRPs in the event thatcertain contingencies occur, such as the discovery of significant new information about site conditions. On October 10, 2012, the EPA, the United States, the Commonwealth of Massachusetts and AVX announced that they hadreached a financial settlement with respect to the EPA’s ongoing clean-up of the New Bedford Harbor in the Commonwealth(the “harbor”). That agreement is contained in a Supplemental Consent Decree that modifies certain provisions of a 1992Consent Decree regarding clean-up of the harbor, including elimination of the governments’ right to invoke certain clean-upreopener provisions in the 1992 Consent Decree in the future. Under the terms of the settlement, AVX was obligated to pay$366,250, plus interest computed from August 1, 2012, in three installments over a two-year period for use by the EPA and theCommonwealth to complete the clean-up of the harbor. The settlement also required the EPA to withdraw the UnilateralAdministrative Order (the “UAO”) that was issued on April 18, 2012 regarding additional clean-up activities. The United StatesDistrict Court approved the settlement and entered the Supplemental Consent Decree on September 19, 2013. On October 18,2013, we paid the initial settlement installment of $133,350, plus accrued interest of $3,954. On March 26, 2014, we prepaid asecond settlement installment of $110,817, plus accrued interest of $822 on the remaining settlement amount through that date.In accordance with the terms of the settlement, we are obligated to pay the remaining balance of $122,083, plus interest, onSeptember 21, 2015. We have the option to prepay any portion of the remaining settlement balance at any time prior to the duedate. Also, on June 3, 2010, AVX entered into an agreement with the EPA and the City of New Bedford, pursuant to which AVXis required to perform environmental remediation at a site referred to as the “Aerovox Site” (the “Site”), located in New Bedford,Massachusetts. AVX has substantially completed its obligations pursuant to such agreement with the EPA and the City of NewBedford with respect to the satisfaction of AVX’s federal law requirements. Agreements with the state regulatory authorities haveyet to be concluded but are likely to include additional groundwater remediation. We have a remaining accrual of $11,845 atMarch 31, 2015, representing our estimate of the potential liability related to the remaining performance of environmentalremediation actions at the Site using certain assumptions regarding the plan of remediation. Since additional sampling and analysismay cause the state regulatory authority, the Massachusetts Department of Environmental Protection, to require a more extensiveand costly plan of remediation, until all parties agree and remediation is complete, we cannot be certain there will be no additionalcost relating to the Site. We had total reserves of approximately $135,336 and $138,146 at March 31, 2014 and 2015, respectively, related to thevarious environmental matters. These reserves are classified in the Consolidated Balance Sheets as $4,354 and $127,246 in accruedexpenses at March 31, 2014 and 2015, respectively, and $130,983 and $10,900 in other non-current liabilities at March 31, 2014and March 31, 2015, respectively. The amounts recorded for identified contingent liabilities are based on estimates. Amountsrecorded are reviewed periodically and adjusted to reflect additional legal and technical information that becomes available. Also,uncertainties about the status of laws, regulations, regulatory actions, technology, and information related to individual sites make itdifficult to develop an estimate of the reasonably possible aggregate environmental remediation exposure. Accordingly, thesecosts could differ from our current estimates. 75  We also operate on other sites that may have potential future environmental issues as a result of activities at sites during AVX’slong history of manufacturing operations or prior to the start of operations by AVX. Even though we may have rights ofindemnity for such environmental matters at certain sites, regulatory agencies in those jurisdictions may require us to address suchissues. Once it becomes probable that we will incur costs in connection with remediation of a site and such costs can bereasonably estimated, we establish reserves or adjust our reserves for our projected share of these costs. A separate accountreceivable is recorded for any indemnified costs. Our environmental reserves are not discounted and do not reflect any possiblefuture insurance recoveries, which are not expected to be significant, but do reflect a reasonable estimate of cost sharing atmultiple party sites or indemnification of our liability by a third party. On November 27, 2007, a suit was filed in South Carolina State Court by individuals as a class action with respect to propertyadjacent to our Myrtle Beach, South Carolina factory claiming property values were negatively impacted by alleged migration ofcertain pollutants from our property. The parties agreed to a $1,200 settlement of the action, which was approved by the Courton December 15, 2014 and paid in January 2015. An appeal of one aspect of that class action is still pending before the SouthCarolina Supreme Court; if resolved against AVX, it may result in additional litigation. On March 1, 2010, AVX was named as a third party defendant in a case filed in Massachusetts Superior Court captionedDaRosa v. City of New Bedford. This case relates to a former disposal site in the City of New Bedford located at Parker Street. TheCity asserts that a predecessor company, Aerovox, among others, contributed to contamination at that site. AVX believes it hasmeritorious defenses and intends to vigorously defend the case. On October 16, 2014, a case was filed against AVX in Massachusetts Superior Court by the City of New Bedford arisingfrom contamination at the City’s New Bedford Railyard. AVX had previously received a formal demand from the City in theamount of approximately $11,000 related to activities by Aerovox. AVX believes it has meritorious defenses and intends tovigorously defend the case. On April 25, 2013, AVX was named as a defendant in a patent infringement case filed in the United States District Court forthe District of Delaware captioned Greatbatch, Inc. v AVX Corporation. This case alleges that certain AVX products infringe on oneor more of six Greatbatch patents. AVX believes it has meritorious defenses and intends to vigorously defend the case. On September 2, 2014, a subsidiary of AVX, American Technical Ceramics (“ATC”), was named as a defendant in a patentinfringement case filed in the United States District Court for the District of Delaware captioned Presidio Components, Inc. v. AmericanTechnical Ceramics Corp. This case alleges that certain products of ATC’s infringe on a Presidio patent. AVX believes it hasmeritorious defenses and intends to vigorously defend the case. During the quarter ended September 30, 2014, AVX was named as a co-defendant in a series of cases filed in the UnitedStates and in the Canadian provinces of Quebec, Ontario and British Columbia alleging violations of United States, Canadian,and state antitrust laws asserting that AVX and numerous other companies are participants in alleged price-fixing in the capacitormarket. The cases in the United States were consolidated into the Northern District of California on October 2, 2014. During thequarter ended December 31, 2014, additional Canadian cases were filed in the provinces of Quebec, Ontario, British Columbia,Saskatchewan and Manitoba. These cases are at the very initial stages. AVX believes it has meritorious defenses and intends tovigorously defend the cases. We are involved in other disputes, warranty, and legal proceedings arising in the normal course of business. While we cannotpredict the outcome of these disputes and proceedings, management believes, based upon a review with legal counsel, that noneof these proceedings will have a material impact on our financial position, results of operations, comprehensive income (loss), orcash flows. 13. Derivative Financial Instruments: We are exposed to foreign currency exchange rate fluctuations in the normal course of business. We use derivative instruments(forward contracts) to hedge certain foreign currency exposures as part of the risk management strategy. The objective is to offsetgains and losses resulting from these exposures with gains and losses on the forward contracts used to hedge them, therebyreducing volatility of earnings or protecting fair values of assets and liabilities. We do not enter into any trading or speculativepositions with regard to derivative instruments. 76 We primarily use forward contracts, with maturities less than four months, designated as cash flow hedges to protect againstthe foreign currency exchange rate risks inherent in our forecasted transactions related to purchase commitments and salesdenominated in various currencies. These derivative instruments are designated and qualify as cash flow hedges. The effectiveness of the cash flow hedges is determined by comparing the cumulative change in the fair value of the hedgecontract with the cumulative change in the fair value of the hedged transaction, both of which are based on forward rates. Theeffective portion of the gain or loss on these cash flow hedges is initially recorded in accumulated other comprehensive income(loss) as a separate component of stockholders’ equity. Once the hedged transaction is recognized, the gain or loss is recognized inour results of operations. At March 31, 2014 and 2015, respectively, the Company had the following forward contracts that wereentered into to hedge against the volatility of foreign currency exchange rates for certain forecasted sales and purchases. 77  March 31, 2014Fair Value of Derivative Instruments Asset DerivativesLiability Derivatives Balance Sheet CaptionFair ValueBalance SheetCaptionFair Value Foreign exchange contractsPrepaid and other$548 Accrued expenses$332 March 31, 2015Fair Value of Derivative Instruments Asset DerivativesLiability Derivatives Balance Sheet CaptionFair ValueBalance SheetCaptionFair Value Foreign exchange contractsPrepaid and other$1,090 Accrued expenses$864 For these derivatives designated as hedging instruments, during fiscal 2013, 2014, and 2015, net pre-tax gains (losses) of$(4,432), $(3,567), and $(2,133), respectively, were recognized in other comprehensive income (loss). In addition, during fiscal2013, 2014, and 2015, net pretax gains (losses) of $(7,448), $(5,140), and $(11,040), respectively, were reclassified from accumulatedother comprehensive income (loss) into cost of sales (for hedging purchases), and net pre-tax gains of $2,971, $509 and $8,725,respectively, were reclassified from accumulated other comprehensive income (loss) into sales (for hedging sales) in theaccompanying statement of operations. Derivatives not designated as hedging instruments consist primarily of forwards used to hedge foreign currency balance sheetexposures representing hedging instruments used to offset foreign currency changes in the fair values of the underlying assets andliabilities. The gains and losses on these foreign currency forward contracts are recognized in other income and expense in thesame period as the remeasurement gain and loss of the related foreign currency denominated assets and liabilities and thusnaturally offset these gains and losses. At March 31, 2014 and 2015, we had the following forward contracts that were enteredinto to hedge against these exposures. March 31, 2014Fair Value of Derivative Instruments Asset DerivativesLiability Derivatives Balance Sheet CaptionFair ValueBalance SheetCaptionFair Value Foreign exchange contractsPrepaid and other$16 Accrued expenses$101 March 31, 2015Fair Value of Derivative Instruments Asset DerivativesLiability Derivatives Balance Sheet CaptionFair ValueBalance SheetCaptionFair Value Foreign exchange contractsPrepaid and other$189 Accrued expenses$306 78 For these derivatives not designated as hedging instruments during fiscal 2013, 2014, and 2015, gains (losses) of $(227),$(3,462), and $(4,392), respectively, were recognized in other expense, which partially offset the $1,022, $4,035 and $5,006 inexchange gains (losses), respectively, that were recognized in other income in the accompanying statement of operations. At March 31, 2014 and 2015, we had outstanding foreign exchange contracts with notional amounts totaling $202,865 and$205,911, respectively, denominated primarily in euros, Czech korunas, British pounds, and Japanese yen. 14. Transactions With Affiliate: Our business includes certain transactions with our majority shareholder, Kyocera, that are governed by agreements betweenthe parties that define the sales terms, including pricing for the products. The nature and amounts of transactions with Kyoceraare included in the table below. Fiscal Year Ended March 31, 201320142015Sales:Product and equipment sales to affiliates$12,804 $20,530 $28,723 Purchases:Purchases of resale inventories, raw materials, supplies, equipment, and services419,472 322,570 272,679 Other:Dividends paid36,540 43,544 48,720 Kyocera notified AVX in February 2014 of its intent, effective April 1, 2015, to market its connector products in Asia usingKyocera’s sales force rather than continuing to have AVX resell such products in Asia. Sales of Kyocera connector products inAsia were $41,314, $43,858 and $47,513 with operating profit of $2,591, $2,720 and $1,944 for the fiscal years ended March 31,2013 and March 31, 2014 and March 31, 2015, respectively. 15. Segment and Geographic Information: Our operating segments are based on the types of products from which we generate revenues. We are organized into aproduct line organization with five main product groups and three reportable segments: Passive Components, KED Resale, andInterconnect. The product groups of Ceramic, Advanced, and Tantalum have been aggregated into the Passive Componentsreportable segment in accordance with the aggregation criteria and quantitative thresholds. The aggregation criteria consist ofsimilar economic characteristics, products and services, production processes, customer classes, and distribution channels. ThePassive Components segment consists primarily of surface mount and leaded ceramic capacitors, RF thick and thin filmcomponents, surface mount and leaded tantalum capacitors, surface mount and leaded film capacitors, ceramic and film powercapacitors, super capacitors, EMI filters (bolt in and surface mount), thick and thin film packages of multiple passive integratedcomponents, varistors, thermistors, inductors, and resistive products manufactured by us or purchased from other manufacturersfor resale. The KED Resale segment consists primarily of ceramic capacitors, frequency control devices, SAW devices, sensorproducts, RF modules, actuators, acoustic devices, and connectors produced by Kyocera and resold by AVX. The Interconnectsegment consists primarily of Elco automotive, telecom, and memory connectors manufactured by AVX Interconnect orpurchased from other manufacturers for resale. Sales and operating results from these reportable segments are shown in thetables below. In addition, we have a corporate administration group consisting of finance, legal, EHS, and administrativeactivities. We evaluate performance of our segments based upon sales and operating profit. There are no intersegment revenues. Weallocate the costs of shared resources between segments based on each segment’s usage of the shared resources. Cash, accountsreceivable, investments in securities, and certain other assets, which are centrally managed, are not readily allocable to operatingsegments. 79 The tables below present information about reported segments: Fiscal Year Ended March 31,Sales revenue (in thousands)201320142015Ceramic Components$173,315 $193,978 $202,719 Tantalum Components330,209 394,119 355,974 Advanced Components346,543 357,900 359,315 Total Passive Components850,067 945,997 918,008 KDP and KCD Resale377,707 293,048 229,869 KCP Resale Connectors61,809 64,680 70,741 Total KED Resale439,516 357,728 300,610 Interconnect124,817 138,879 134,610 Total Revenue$1,414,400 $1,442,604 $1,353,228 Fiscal Year Ended March 31, 201320142015Operating profit (loss):Passive components$145,870 $165,441 $217,706 KED Resale17,659 18,074 21,010 Interconnect25,042 27,689 28,072 Corporate activities(308,416)(52,040)(54,039)Total$(119,845)$159,164 $212,749 Fiscal Year Ended March 31, 201320142015Depreciation and amortization:Passive components$34,317 $32,662 $29,394 KED Resale272 169 104 Interconnect5,885 6,863 5,921 Corporate activities6,397 10,515 6,795 Total$46,871 $50,209 $42,214 As of March 31, 20142015Assets:Passive components$744,821 $742,543 KED Resale43,872 39,900 Interconnect51,012 46,111 Cash, A/R and S/T and L/T investments1,107,734 1,182,527 Goodwill - Passive components202,774 202,774 Goodwill - Interconnect10,277 10,277 Corporate activities224,498 234,883 Total$2,384,988 $2,459,015 80  Fiscal Year Ended March 31, 201320142015Capital expenditures:Passive components$29,029 $22,764 $21,452 KED Resale30 114 4 Interconnect12,598 3,269 4,899 Corporate activities2,048 658 244 Total$43,705 $26,805 $26,599 During the fiscal years ended March 31, 2015 and March 31, 2014, no customers accounted for more than 10% of theCompany’s sales. One customer accounted for 13% of net sales during the fiscal year ended March 31, 2013. As of March 31,2015 and March 31, 2014, one customer represented 15% of the Company’s accounts receivable balance. The following geographic data is based upon net sales generated by operations located within that geographic area and thephysical location of long-lived assets. Substantially all of the sales in the Americas region were generated in the United States. Fiscal Year Ended March 31, 201320142015Net sales:Americas$390,152 $404,446 $402,209 Europe351,603 379,183 388,747 Asia672,645 658,975 562,272 Total$1,414,400 $1,442,604 $1,353,228 Property, plant and equipment, net:Americas$103,177 $89,086 $81,787 Europe98,279 92,430 68,442 Asia56,808 54,209 49,613 Total$258,264 $235,725 $199,842 1. 81 16. Summary of Quarterly Financial Information (Unaudited): Quarterly financial information for the fiscal years ended March 31, 2014 and 2015 is as follows: First QuarterSecond Quarter 2014201520142015Net sales$369,379 $350,589 $375,785 $365,405 Gross profit68,271 85,177 71,525 87,773 Net income27,657 40,771 28,816 44,621 Basic earnings per share0.16 0.24 0.17 0.27 Diluted earnings per share0.16 0.24 0.17 0.27 Third QuarterFourth Quarter 2014201520142015Net sales$346,211 $321,687 $351,229 $315,547 Gross profit67,766 78,677 71,272 76,942 Net income31,434 38,953 39,130 101,526 Basic earnings per share0.19 0.23 0.23 0.60 Diluted earnings per share0.19 0.23 0.23 0.60 Results for the quarter ended March 31, 2015 include $67,153 or $0.40 per diluted share of one-time income tax benefitsprimarily attributable to the reversal of valuation allowances related to the future utilization of net operating loss carryforwards inour European operations and tax benefits related to the restructuring of foreign subsidiaries in the fourth quarter. 17. Subsequent Events: On May 14, 2015, our Board of Directors declared a $0.105 dividend per share of common stock for the quarter endedMarch 31, 2015. The dividend will be paid to stockholders of record on June 5, 2015 and will be disbursed on June 19, 2015. 82 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of AVX Corporation In our opinion, the accompanying consolidated balance sheets and the related consolidated statements ofoperations, comprehensive income (loss), stockholders' equity and cash flows present fairly, in all material respects, the financialposition of AVX Corporation and its subsidiaries at March 31, 2015 and March 31, 2014, and the results of their operations and theircash flows for each of the three years in the period ended March 31, 2015 in conformity with accounting principles generallyaccepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internalcontrol over financial reporting as of March 31, 2015, based on criteria established in Internal Control - Integrated Framework(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management isresponsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessmentof the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over FinancialReporting. Our responsibility is to express opinions on these financial statements and on the Company's internal control overfinancial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the PublicCompany Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtainreasonable assurance about whether the financial statements are free of material misstatement and whether effective internalcontrol over financial reporting was maintained in all material respects. Our audits of the financial statements included examining,on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principlesused and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit ofinternal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessingthe risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control basedon the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances.We believe that our audits provide a reasonable basis for our opinions. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposes in accordance with generally acceptedaccounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertainto the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assetsof the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company arebeing made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets thatcould have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because ofchanges in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/PricewaterhouseCoopers LLP PricewaterhouseCoopers LLPAtlanta, GeorgiaMay 20, 201583Exhibit 10.19AVX CorporationAmended and Restated 2014 Management Incentive Plan 1. Purpose. The Company wishes to provide for the award of annual incentive compensationto selected employees of the Company and its Subsidiaries if specified Performance Goals are achieved. Thegeneral purpose of the Plan is to promote the interests of the Company’s shareholders by providing to selectedemployees incentives to continue and to increase their efforts with respect to, and remain in the employ of, theCompany and its Subsidiaries. 2. Administration. The Plan will be administered by the Compensation Committee of theBoard of Directors (the “Committee”), which shall be comprised of three or more persons, at least two ofwhom shall qualify as an “outside director” within the meaning of Section 162(m) of the Internal Revenue codeof 1986, as amended. Subject to the express provisions of the Plan, the Committee shall have plenary authority, in itsdiscretion, to administer the Plan and to exercise all powers and authority either specifically granted to it underthe Plan or necessary and advisable in the administration of the Plan, including without limitation the authorityto interpret the Plan; to prescribe, amend and rescind rules and regulations relating to the Plan; to grant Awards,to determine the terms, provisions and conditions of all Awards granted under the Plan (which need not beidentical), the individuals to whom and the time or times when Awards shall be granted, and to make all othernecessary or advisable determinations with respect to the Plan. The determination of the Committee on suchmatters shall be conclusive. 3. Participants. The Committee shall from time to time select the Corporate Officers of theCompany to whom Awards are to be granted, and who will, upon such grant, become participants in the Plan. 4. Performance Awards. (a) The Performance Goal(s) and Performance Period applicable to an Award shall be setforth in writing by the Committee no later than 90 days after the commencement of the PerformancePeriod. The Committee shall have the discretion to later revise the Performance Goal(s) solely for thepurpose of reducing or eliminating the amount of compensation otherwise payable upon attainment ofthe Performance Goal(s). (b) In making an Award, the Committee, after taking into account the input from the ChiefExecutive Officer with respect to the other participants, may take into account a participant’s responsibility level,performance, cash compensation level, incentive compensation awards and such other considerations as itdeems appropriate. The amount paid out upon satisfying the Performance Goals shall not exceed 200% ofthe employee’s base salary determined on the date of grant of the Award, and in no event shall an employeereceive payments under the Plan in connection with any one fiscal year which exceeds $5.0 million. 5. Employment. Except as provided below, an Award shall terminate, and the participant willforfeit all rights to such Award, if the participant does not remain continuously employed and in good standingwith the Company until payment of such Award. In the event of the termination of a participant’s employmentafter the end of a Performance Period but prior to payment of such Award by reason of the participant’sRetirement, Incapacity or death, the participant, or the participant’s estate, as the case may be, will be entitled tosuch Award, payable as provided in Section 6 below. In the event of a participant’s Retirement, Incapacity ordeath prior to the end of a Performance Period, the participant, or the1 participant’s estate, as the case may be, will be entitled to receive a payment equal to the pro rata portion (basedon the number of days worked during the Performance Period) of the Award, if any, that would otherwise bepayable if the participant had continued employment through the end of the Performance Period. Such prorata payment, if any, will be payable as provided in Section 6 below. 6.Payment of Awards. Payment with respect to an Award will be made within a reasonableperiod of time after the determination of any performance Award by the Committee, but no later than March15 next following the end of the Performance Period for which an Award was earned. 7.Nonexclusive Plan. Neither the adoption of the Plan by the Board nor the submission of thePlan to the stockholders of the Company for approval shall be construed as creating any limitations on thepower of the Board to adopt such other incentive arrangements as it may deem desirable and sucharrangements may be either generally applicable or applicable only in specific cases. 8.Nonassignability. No Awards may be transferred, alienated or assigned other than by will orby the laws of descent and distribution. 9.Amendment of Discontinuance. The Plan may be amended or discontinued by theCommittee without the approval of the Board. 10.Effect of Plan. Neither the adoption of the Plan nor any action of the Board or Committeeshall be deemed to give any officer or employee any right to continued employment or any other rights. 11.Effective Date of Plan. The Plan shall take effect as of April 1, 2014. 12. Withholding. The company shall have the authority and the right to deduct or withhold, orrequire a participant to remit to the Company, an amount sufficient to satisfy federal, state, country and localtaxes (including the participant’s FICA obligation) required by law to be withheld with respect to any taxableevent arising as a result of the Plan. 13.Definitions. For the purpose of this Plan, unless the context requires otherwise, the followingterms shall have the meanings indicated: (a)“Award” means a cash incentive award made pursuant to this Plan. (b)“Board” means the Board of Directors of the Company. (c)“Committee” means the Compensation Committee of the Board. (d)“Company” means AVX Corporation, a Delaware corporation. (e)"Incapacity" means any material physical, mental or other disability rendering theparticipant incapable of substantially performing his services hereunder that is not curedwithin 180 days of the first occurrence of such incapacity. In the event of any disputebetween the Company and the participant as to whether the participant is incapacitated asdefined herein, the determination of whether the participant is so incapacitated shall bemade by an independent physician selected by the Company's Board of Directors and thedecision of such physician shall be binding upon the Company and the participant. 2 (f)“Performance Goal(s)” means the Profit Before Taxes target established by theCommittee for a Performance Period. (g)“Performance Period” means the fiscal year of the Company or such other period of timeas is designated by the Committee during which the Performance Goal(s) are measured. (h)“Plan” means this 2014 AVX Corporation Management Incentive Plan as amended fromtime to time. (i)“Profit Before Taxes” means income before special, unusual, restructuring orextraordinary items and taxes as reported in the Company’s consolidated financialstatements. (j)“Retirement” means, with respect to any participant, the participant's retirement as anemployee of the Company on or after reaching age 65, or as otherwise provided under aparticipant's terms of employment governed by a separate agreement. (k)“Subsidiary” means any corporation in an unbroken chain of corporations beginningwith the Company if each of the corporations other than the last corporation in theunbroken chain owns stock possessing 50% or more of the total combined voting powerof all classes of stock in one of the other corporations in the chain. The “Subsidiaries”means more than one of any such corporations.3 AMENDMENT TO THE AVX NONQUALIFIED SUPPLEMENTAL RETIREMENT PLAN WHEREAS, AVX Corporation (the "Employer") heretofore adopted the AVX NonqualifiedSupplemental Retirement Plan (the "Plan"); and WHEREAS, the Employer reserved the right to amend the Plan; and WHEREAS, the Employer desires to amend the Plan; NOW, THEREFORE, the Plan is hereby amended, effective as of January 1, 2015, as follows: 1.Section 2 of the Plan shall be amended by adding the following definition under Section 2.13: 2.13 “GREENVILLE PLAN” means the AVX Greenville LLC 401(k) Plan. 2.Section 7 of the Plan shall be amended to read in its entirety as follows: SECTION 7. COMPANY CONTRIBUTIONS For each Plan Year, the Company shall allocate to the account of each Participant who hasreceived the maximum matching contribution available under the Retirement Plan for theapplicable year, an amount equal to one hundred percent (100%) of the first three percent (3%) ofthe Participant’s Compensation deferred under the Plan for the year pursuant to the first paragraphunder Section 4, reduced by the matching contribution made on his behalf under the RetirementPlan for the year. For each Plan Year, the Company shall allocate to the account of eachParticipant who has received the maximum matching contribution available under the GreenvillePlan for the applicable year, an amount equal to fifty percent (50%) of the first six percent (6%) ofthe Participant’s Compensation deferred under the Plan for the year pursuant to the first paragraphunder Section 4, reduced by the matching contribution made under the Greenville Plan for theyear. In addition, for each Participant who is a participant in the Retirement Plan, if the Participant isemployed by the Company on December 31 of such year (or is not employed due to his or herretirement, disability or death during such year, as determined under the Retirement Plan), theCompany shall allocate to the account of such Participant an amount equal to the additionalamount that would have been contributed by the Company to the Retirement Plan on suchParticipant’s Compensation not in excess of six hundred thousand dollars ($600,000) under thefixed and discretionary portions of the Retirement Plan had there been no limit on Compensationunder the Retirement Plan, as required by Section 401(a)(17) of the Code. Provided, however,that, if any such Participant defers Compensation under Section 4, the Company shall allocate tothe account of such Participant an amount equal to the additional amount that would have beencontributed by the Company to the Retirement Plan on behalf of the Participant under the fixedand discretionary portions of the Retirement Plan on such1 Participant’s Compensation deferred under Section 4. 3.Section 9 of the Plan shall be amended to read in its entirety as follows: SECTION 9. INVESTMENT OF ACCOUNTS For purposes of determining the amount of earnings and appreciation and losses and depreciationto be credited to a Participant’s account(s), any amount’s deferred by the Participant underSection 4, and, except as otherwise provided below, any Company contributions made underSection 7, shall be deemed invested in the investment options (designated by the Administrator asavailable under the Plan) as the Participant may elect, from time to time, in accordance with suchrules and procedures as the Administrator may establish. However, any matching contributionsmade under Section 7 prior to January 1, 2015 shall be deemed to be invested in the AVX StockFund, an option deemed to be invested primarily in shares of Company stock, with a portiondeemed invested in cash and cash equivalents for liquidity purposes; provided, however, that aParticipant may elect to change such investment in accordance with such rules and procedures asthe Administrator may establish. However, no provision of the Plan shall require the Company toactually invest any amounts in any fund or in any other investment vehicle. 4.Except as hereinabove amended, the provisions of the Plan shall continue in full force and effect. IN WITNESS WHEREOF, the Employer, by its duly authorized officer, has caused this Amendmentto be executed on the 15th day of December, 2014. AVX CORPORATION By:__________________________________________ Kathleen M. Kelly, Vice President – Human Resources 2EXHIBIT 21.1 AVX CORPORATIONSUBSIDIARIES OF THE REGISTRANT As of March 31, 2015, active significant subsidiaries, all 100% owned directly or indirectly, consist of the following: 1.AVX Corporation (Delaware)2.AVX Tantalum Corporation (Delaware)3.AVX Filters Corporation (Delaware)4.Elco USA, Inc. (Delaware)5.Avio Excelente, S.A. DE C.V. (Mexico)6.AVX Industries. Pte. Ltd. (Singapore)7.AVX Components DA Amazonia Ltda. (Brazil)8.AVX Israel Limited (Israel)9.AVX Limited (United Kingdom)10.AVX Czech Republic s.r.o. (Czech Republic)11.TPC - SAS (France)12.Elco Europe GmbH (Germany)13.AVX/Kyocera Pt. Ltd. (Singapore)14.TPC (Malaysia) Sdn. Bhd. (Malaysia)15.AVX Electronics (Tianjin) Co. Ltd. (China)16.AVX/Kyocera Asia Ltd. (Hong Kong)17.Kyocera Electronic Devices, LLC (Delaware)18.American Technical Ceramics Corp (New York)19.American Technical Ceramics (Florida), Inc.20.AVX Tantalum Asia Corporation (Japan)21.AVX Tantalum (Tianjin) Co., Ltd. (China)  CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 33-98094, 33-98114, 333-02808, 333-37201, 333-00890, 333-85561, 333-103611, 333-127362, 333-152744, 333-177816, 333-193804 and 333-197888) of AVX Corporation of our report dated May 20, 2015relating to the financial statements and the effectiveness of internal control over financial reporting, whichappears in this Form 10-K. /s/ PricewaterhouseCoopers LLPPricewaterhouseCoopers LLPAtlanta, GeorgiaMay 20, 20151LEGAL01/13179800v2Exhibit 24.1 AVX CORPORATION POWER OF ATTORNEY Each of the undersigned directors and officers of AVX Corporation, a Delaware corporation (the"Corporation"), hereby severally constitutes and appoints Kurt Cummings, Michael Hufnagel, andHollirae Olson, each of them signing singly, to be his Attorney-in-Fact with full power of substitution toact in his name on his behalf to sign and to file with the Securities and Exchange Commission (1) underthe Securities Exchange Act of 1934, the Corporation's Annual Report on Form 10-K for the fiscal yearended March 31, 2015 (the “Annual Report”) and (2) under the Securities Act of 1933, RegistrationStatements on Form S-8 or other appropriate Forms which incorporate by reference the Annual Report(each a "Registration Statement"), and any and all amendments to any such Registration Statement, forshares of the Corporation's Common Stock, $.01 par value, and other interests therein issuable undereach of the following employee benefit plans as the same may be amended from time to time, (i) theAVX Corporation Retirement Plan, (ii) the AVX Corporation 1995 Stock Option Plan, (iii) the AVXCorporation Non-Employee Directors' Stock Option Plan, (iv) the AVX Corporation 2004 StockOption Plan, (v) the AVX Corporation 2004 Non-Employee Director’s Stock Option Plan, (vi) theAFGWU Local 1028 401(k) Retirement Plan for Employees of AVX Corporation in Raleigh, NorthCarolina, (vii) the AVX Corporation SERP, (viii) the AVX Corporation Non-qualified SupplementalRetirement Plan, (ix) the AVX Corporation 401(k) Plan for Hourly Paid Employees at Myrtle Beach andConway Plants, (x) the AVX Corporation 2014 Stock Option Plan, (xi) the AVX Corporation 2014Non-Employee Directors’ Stock Option Plan, and (xii) the AVX Corporation Restricted Stock Unit Plan,and in each case, to execute and deliver any agreements, instruments, certificates or other documentswhich such person shall deem necessary or proper in connection with the filing of any such RegistrationStatement or the Annual Report, including any amendments or supplements thereto, and generally to actfor and in the name of the undersigned with respect to any such filing as fully as could the undersigned ifthen personally present and acting. In addition, to act in his name on his behalf to: (a) execute for and on behalf of the undersigned in the undersigned's capacity as anofficer and/or director of the Corporation, Forms 3, 4 and 5 in accordance with Section 16(a) of theSecurities Exchange Act of 1934 and the rules thereunder; (b) do and perform any and all acts for and on behalf of the undersigned which may benecessary or desirable to complete and execute any such Form 3, 4 or 5 and timely file such form(s) withthe United States Securities and Exchange Commission and any stock exchange or similar authority, and (c) take any other action of any type whatsoever in connection with the foregoingwhich, in the opinion of such attorney-in-fact, may be of benefit to or in the interest of undersigned, itbeing understood that the documents executed by such attorney-in-fact on behalf of the undersignedpursuant to this Power of Attorney shall be on such terms and conditions as such attorney-in-fact mayapprove in such attorney-in-fact's discretion. The undersigned hereby grants to each such attorney-in-fact full power and authority to do and performany and every act and thing whatsoever requisite, necessary, or proper to be done in the exercise of anyof the rights and powers herein granted, as fully to all intents and purposes as the undersigned might orcould do if personally present, with full power of substitution or revocation, hereby ratifying and confirming all that such attorney-in-fact, or such attorney-in-fact's substitute orsubstitutes, shall lawfully do or cause to be done by virtue of this power of attorney and the rights andpowers herein granted. The undersigned acknowledges the foregoing attorneys-in-fact, in serving insuch capacity at the request of the undersigned, are not assuming, nor is the Corporation assuming, anyof the undersigned's responsibilities to comply with Section 16 of the Securities Exchange Act of 1934. This Power of Attorney shall remain in full force and effect unless earlier revoked by the undersigned ina signed writing delivered to the foregoing attorneys-in-fact. IN WITNESS WHERE OF, the undersigned has executed this Power-of-Attorney on the date setopposite his respective name. SIGNATURE TITLE DATE /s/ Kazuo InamoriDirectorApril 27, 2015KAZUO INAMORI /s/ John SarvisDirectorApril 27, 2015JOHN SARVIS /s/ Tetsuo Kuba Director April 27, 2015 TETSUO KUBA /s/ Goro YamaguchiDirectorApril 27, 2015GORO YAMAGUCHI /s/ Tatsumi Maeda Director April 27, 2015TATSUMI MAEDA /s/ Shoichi Aoki Director April 27, 2015SHOICHI AOKI - 2 -  /s/ Donald Christiansen Director April 27, 2015DONALD CHRISTIANSEN /s/ Joseph Stach Director April 27, 2015JOSEPH STACH /s/ David DeCenzo Director April 27, 2015DAVID DECENZO - 3 -EXHIBIT 31.1CERTIFICATIONS I, John Sarvis, certify that: 1.I have reviewed this annual report on Form 10-K of AVX Corporation; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to statea material fact necessary to make the statements made, in light of the circumstances under which suchstatements were made, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report,fairly present in all material respects the financial condition, results of operations and cash flows of theregistrant as of, and for, the periods presented in this report; 4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosurecontrols and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controlover financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant andhave: a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures tobe designed under our supervision, to ensure that material information relating to the registrant,including its consolidated subsidiaries, is made known to us by others within those entities, particularlyduring the period in which this report is being prepared; b.Designed such internal control over financial reporting, or caused such internal control over financialreporting to be designed under our supervision, to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles; c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in thisreport our conclusions about the effectiveness of the disclosure controls and procedures, as of the endof the period covered by this report based on such evaluation; and d.Disclosed in this report any change in the registrant's internal control over financial reporting thatoccurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the caseof an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant'sinternal control over financial reporting; and 5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internalcontrol over financial reporting, to the registrant's auditors and the audit committee of the registrant's boardof directors (or persons performing the equivalent functions): a.All significant deficiencies and material weaknesses in the design or operation of internal control overfinancial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,summarize and report financial information; and b.Any fraud, whether or not material, that involves management or other employees who have asignificant role in the registrant's internal control over financial reporting. /s/ John SarvisDate: May 20, 2015 John Sarvis Chief Executive Officer and President A signed original of this written statement required by Section 302 of the Sarbanes-Oxley Act of 2002 has beenprovided to AVX Corporation and will be retained by AVX Corporation and furnished to the Securities andExchange Commission or its staff upon request.EXHIBIT 31.2CERTIFICATIONS I, Kurt P. Cummings, certify that: 1.I have reviewed this annual report on Form 10-K of AVX Corporation; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to statea material fact necessary to make the statements made, in light of the circumstances under which suchstatements were made, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report,fairly present in all material respects the financial condition, results of operations and cash flows of theregistrant as of, and for, the periods presented in this report; 4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosurecontrols and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controlover financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant andhave: a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures tobe designed under our supervision, to ensure that material information relating to the registrant,including its consolidated subsidiaries, is made known to us by others within those entities, particularlyduring the period in which this report is being prepared; b.Designed such internal control over financial reporting, or caused such internal control over financialreporting to be designed under our supervision, to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles; c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in thisreport our conclusions about the effectiveness of the disclosure controls and procedures, as of the endof the period covered by this report based on such evaluation; and d.Disclosed in this report any change in the registrant's internal control over financial reporting thatoccurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the caseof an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant'sinternal control over financial reporting; and 5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internalcontrol over financial reporting, to the registrant's auditors and the audit committee of the registrant's boardof directors (or persons performing the equivalent functions): a.All significant deficiencies and material weaknesses in the design or operation of internal control overfinancial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,summarize and report financial information; and b.Any fraud, whether or not material, that involves management or other employees who have asignificant role in the registrant's internal control over financial reporting. /s/ Kurt P. CummingsDate: May 20, 2015 Kurt P. Cummings Vice President, Chief Financial Officer,Treasurer and Secretary A signed original of this written statement required by Section 302 of the Sarbanes-Oxley Act of 2002 has beenprovided to AVX Corporation and will be retained by AVX Corporation and furnished to the Securities andExchange Commission or its staff upon request.- 1 - EXHIBIT 32.1 CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Annual Report of AVX Corporation (the "Registrant") on Form 10-K for the periodending March 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the“Report”), we, John Sarvis and Kurt P. Cummings, Chief Executive Officer and Chief Financial Officer,respectively, of the Registrant, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of theSarbanes-Oxley Act of 2002, that to our knowledge: (1)The Report fully complies with the requirements of section 13(a) or 15(d) of the SecuritiesExchange Act of 1934; and (2)The information contained in the Report fairly presents, in all material respects, the results ofoperations and financial condition of the Registrant. Date:May 20, 2015 /s/ John SarvisJohn SarvisChief Executive Officer andPresident /s/ Kurt P. CummingsKurt P. CummingsVice President,Chief Financial Officer,Treasurer and Secretary A signed original of this written statement required by Section 906, or other document authenticating,acknowledging, or otherwise adopting the signature that appears in typed form within the electronic versionof this written statement required by Section 906, has been provided to AVX Corporation and will beretained by AVX Corporation and furnished to the Securities and Exchange Commission or its staff uponrequest.

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