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On June 3, 2010, AVX entered into an agreement with the EPA and the City of New Bedford, pursuant to which AVX is 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 New Bedford with respect to the satisfaction of AVX’s federal law requirements. Agreements withThe Massachusetts Department of Environmental Protection has jurisdiction over the balance of the environmental remediation at the Site. AVX has submitted its proposed remedy, but until the state regulatory authorities are not concluded yet but are likely to includehas approved such proposal, AVX cannot determine if additional groundwater and soil remediation will be required, if substantial material will have to be disposed of offsite, or if additional remediation techniques will be required, any of which could result in a more extensive and costly plan of remediation. Further, the Site and the remediation may be subject to additional scrutiny under other statutory procedures which could also add to the cost of remediation. We have a remaining accrual of $15.1$14.2 million at March 31, 2017,2018, representing our estimate, including a $3.6 million charge in the current fiscal year,estimate of the potential liability related to the remaining performance of environmental remediation actions at the Site and neighboring properties using certain assumptions regarding the plan of remediation. Since additional sampling and analysis may cause the state regulatory authority, the Massachusetts Department of Environmental Protection, to require a more extensive and costly plan of remediation, untilUntil all parties agree and remediation is complete, we cannot be certain there will be no additional cost relating to the Site.

We had total reserves of approximately $16.8$19.2 million and $19.2$18.6 million at March 31, 20162017 and March 31, 2017,2018, respectively, related to various environmental matters and sites, including those discussed above. These reserves are classified in the Consolidated Balance Sheets as $7.4$3.9 million and $3.9$3.3 million in accrued expenses at March 31, 20162017 and March 31, 2017,2018, respectively, and $9.4 million and $15.3 million in other non-current liabilities at both March 31, 20162017 and March 31, 2017, respectively.2018. The amounts recorded for identified environmental liabilities are based on estimates. Periodically, we review amounts recorded and adjust them to reflectbased upon additional legal and technical information that becomes available. 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 aggregate environmental remediation exposure. Accordingly, these costs could differ from our current estimates.

On April 19, 2016, the Canadian Ministry of the Environment and Climate Change (the “MoE”) issued a Director’s Order naming AVX Corporation, and others, as responsible parties with respect to a location in Hamilton, Ontario that was at one time the site of operations of Aerovox Canada, a former subsidiary of Aerovox Corporation, a predecessor of AVX. This Director’s Order follows a draft order issued on November 4, 2015. AVX has taken the position that any liability of Aerovox Canada for such site under the laws of Canada cannot be imposed on AVX. At present, it is unclear whether the MoE will seek to enforce such Canadian order against AVX, or one of the other responsive parties will initiate a private suit, and whether, in thesuch an event, it does so, AVX will have any liability under applicable law. AVX intends to contest any such course of action that may be taken by the MoE.

We also operate, or did at one time, on other sites that may have potential future environmental issues as a result of activities at sites during AVX’s long history of manufacturing operations 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 those jurisdictions may require us to address such issues. Once it becomes probable that we will incur costs in connection with remediation of a site and such costs can be reasonably estimated, we establish reserves or adjust our reserves for our projected share of these costs. A separate account receivable is recorded for any indemnified costs. Our environmental reserves are not discounted and do not reflect any possible future insurance recoveries, which are not expected to be significant, but do reflect a reasonable estimate of cost sharing at multiple party sites or indemnification of our liability by a third party.

We are not involved in any pending or threatened environmental proceedings that would require curtailment of our operations. We continually expend funds to ensure that our facilities comply with applicable environmental regulations. While we believe that we are in compliance with applicable environmental laws, we cannot accurately predict future developments and do not necessarily have knowledge of all past occurrences on sites that we currently occupy. New environmental regulations may be enacted and we cannot determine the modifications, if any, in our operations that any such future regulations might require, or the cost of compliance with such regulations. Moreover, the risk of environmental liability and remediation costs is inherent in the nature of our business and, therefore, there can be no assurance that material environmental costs, including remediation costs, will not arise in the future.

Company Information and Website

We file annual, quarterly, and current reports, proxy statements, and other documents with the SEC under the Securities Exchange Act of 1934 (the “Exchange Act”). The public may read and copy any materials that we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. In addition, 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. The public 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 SEC onincluding, but not limited to Form 10-K, Form 10-Q, and Form 8-K, and all amendments to those reports, can be viewed and downloaded free of charge as soon as reasonably practicable after the reports and amendments are electronically filed with or furnished to the SEC. To view the reports from our website, go to “Investors,” then to “Financial Reports.“SEC Filings.”

The following corporate governance related documents, as well as others, are also available free of charge on our website:

To review these documents, go to our website and select “About,” followed by “Corporate Information,” and then “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 our bylaws. Each officer holds office until the next annual appointment of officers or until a successor has been duly appointed and qualified, or until the officer’s death or resignation, or until the officer has otherwise been removed in accordance with our bylaws. The following table provides certain information regarding the current executive officers of the Company:

John Sarvis

Chief Executive Officer and President since April 2015. Chairman of the Board since 2016. Vice President of Ceramic Products from 2005 to 2015. Divisional Vice President – Ceramics Division from 1998 to 2005. Prior to 1998, held various Marketing and Operational positions. Employed by the Company since 1973.

Jeffrey Schmersal

Chief Operating Officer since April 2018. Senior Vice President since 2017. Divisional Vice President of Specialty Products from 2014 to 2017. Global Business Manager of various product groups from 2006 to 2014. Prior to 2006, held various Quality and Supply Chain positions. Employed by the Company since 1994.

Kurt P. Cummings

Executive Vice President since 2016. Chief Financial Officer and Treasurer since 2000. Senior Vice President from 2015 to 2016. Vice President from 2000 to 2015. Corporate Secretary from 1997 to 2016. Corporate Controller from 1992 to 2000. Prior to 1992, Partner with Deloitte & Touche LLP.

John Lawing

Senior Vice President and Chief Technology Officer since 2015. Vice President and Chief Technology Officer from April 2014 to 2015. 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 to 2005 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.

Kurt P. Cummings

Executive Vice President since 2016. Chief Financial Officer and Treasurer since 2000. Senior Vice President from 2015 to 2016. Vice President from 2000 to 2015.  Secretary from 1997 to 2016.  Corporate Controller from 1992 to 2000.  Prior to 1992, Partner with Deloitte & Touche LLP.

Evan Slavitt

Senior Vice President, General Counsel and Secretary since 2016. Vice President of Business and Legal Affairs from 2007 to 2016. Trial lawyer in private practice in Massachusetts from 1987 to 2006. Assistant United States Attorney for the District of Massachusetts from 1983 to 1987. Trial Attorney with the Antitrust Division of the U.S. Department of Justice from 1981 to 1983.

Kathleen M. Kelly

Senior Vice President of Human Resources since 2015. Vice President of Human Resources from 2010 to 2015. Vice President of Administration from 2007 to 2010. Prior to the acquisition of American Technical Ceramics by the Company in 2007, served as Vice President – Administration and as Corporate Secretary of American Technical Ceramics from November 1989.

Keith Thomas

Senior Vice President of Corporate Development since 2016.  Senior Vice President of Kyocera Electronic Devices from 2015 to 2016. President of Kyocera Electronic Devices from 2004 to 2016. Vice President of Kyocera Developed Products from 2001 to 2004. Divisional Vice President of Kyocera Developed Products from 1992 to 2001. Employed by the Company since 1980.

Peter Venuto

Senior Vice President of Sales since 2015. Vice President of Sales from 2009 to 2015.  Vice President of North American and European Sales from 2004 to 2009. Vice President of North American Sales from 2001 to 2004. Divisional Vice President of Strategic Accounts from 1998 to 2000. Director of Strategic Accounts from 1990 to 1997. Director of Business Development from 1987 to 1989. Employed by the Company since 1987.

S. Willing King

Senior Vice President of Tantalum Products since 2015. Vice President of Tantalum Products from 2013 to 2015. Deputy General Manager of Tantalum Products from 2012 to 2013. Vice President of Product Marketing from 2004 to 2012. Director of Product Marketing from 2000 to 2004. Prior to 2000, held positions in Technical Service, Sales, and Marketing. Employed by the Company since 1984.

Eric Pratt

From time to time, information provided by us, including, but not limited to, statements in this report, or other statements made by us or on our behalf, may contain “forward-looking” information within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks, uncertainties, and contingencies, many of which are beyond our control, 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 – sometimes materially different – than we presently anticipate. Discussion about the important operational risks that our businesses encounter can also be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Form 10-K. We wish to caution the reader that the following important risk factors and those factors described elsewhere in this report or other documents that we file or furnish to the SEC could cause our actual results to differ materially from those stated in forward-looking statements contained in this document and elsewhere. Below, we have described our current 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 affect our future results.

We operate in a cyclical business, which could result in significant fluctuations in demand for our products

Cyclical changes in our customers’ businesses have, in the past, resulted in, and may in the future result in, significant fluctuations in demand for our products, selling prices, and our profitability. Most of our customers operate in cyclical industries. Their requirements for passiveelectronic components and interconnect, productssensing and control devices fluctuate significantly as a result of changes in general economic conditions, technological changes, customer demand, and other factors. During periods of increasing demand, our customers typically seek to increase their inventory of our products to avoid production bottlenecks. When demand for their products peaks and begins to decline, as has happened in the past, they tend to reduce or cancel orders for our products while they use up accumulated inventory. Business cycles vary somewhat in different geographical regions and customer industries. Significant fluctuations in sales of our products affect our unit manufacturing costs and affect our profitability by making it more difficult for us to predict our production, raw materials, and shipping needs. Changes in demand mix, needed technologies, and end-use markets may adversely affect our ability to match our products, inventory, and capacity to meet customer demand and could adversely affect our operating results and financial condition. We are also vulnerable to general economic events or trends beyond our control, and our sales and profits may suffer in periods of weak demand.

We must consistently reduce costs to remain competitive and to address downward price trends

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 also be 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 operating cost regions we have incurred restructuring costs in the past and are likely to incur restructuring costs in the future in response to competitive pressures. If we are unsuccessful in implementing restructuring or other cost reduction plans, we may experience disruptions in our operations and incur higher ongoing costs, which may adversely affect our sales levels, financial condition, and operating results.

We attempt to improve profitability by operating in countries in which operating costs are lower; but the shift of operations to these regions may entail considerable expense and risk

Our strategy is aimed at achieving significant production cost savings through the transfer to and expansion of manufacturing operations in countries with lower operating costs, such as the Czech Republic,China, Czechia, El Salvador, India, Malaysia, Mexico, ChinaRomania, and El Salvador.Vietnam. During this process, we may experience under-utilization of certain factories in higher-cost regions and capacity constraints in plants and factories located in lower-cost regions. This under-utilization may result initially in production inefficiencies and higher overall costs. These costs also include those associated with compensation in connection with work force reductions and plant closings in the higher-cost regions, and start-up expenses, equipment relocation costs, manufacturing and construction delays, and increased depreciation costs in connection with the initiation or expansion of production in lower-cost regions. In addition, as we implement transfers of certain of our operations, we may experience labor strikes or other types of disruption due to lay-offs or termination of our employees in higher-cost countries.

Our global operations subject us to many different and complex laws and rules

Due to our global operations, we are subject to many laws governing international relations (including but not limited to the Foreign Corrupt Practices Act, and the U.S. Export Administration Act the EU General Data Protection Regulation, and the U.K. Modern Anti-Slavery Act); which prohibit improper payments to government officials and restrict where and how we can do business, what information or products we can supply to certain countries, what personal information we can transfer, and what information we can provide to a non-U.S. government. Although we have procedures and policies in place that should mitigate the risk of violations of these laws, there is no guarantee that they will be sufficiently effective. If, and when we acquire new businesses we may not be able to ensure that the pre-existing controls and procedures meant to prevent violations of the rules and laws were effective, and we may not be able to implement effective controls and procedures to prevent violations quickly enough when integrating newly acquired businesses. Acquisitions of new businesses in new foreignnon-U.S. jurisdictions may also subject us to new regulations and laws, and we may face difficulties ensuring compliance with these new requirements.

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 delivery time. Competitors include large, diversified companies, some of which have substantial assets and financial resources, as well as medium to small companies. There can be no assurance that additional competitors will not enter into our existing markets, nor can there be any assurance that we will be able to compete successfully against existing or new competition.

We may not have adequate facilities to satisfy future increases in demand for our products

Our business is cyclical and in periods of a rising economy, we may experience intense demand for our products. During such periods, we may have difficulty expanding our manufacturing to satisfy demand. Factors that could limit such expansion include delays in procurement of manufacturing equipment, shortages of skilled personnel, and physical constraints on expansion of our facilities.facilities, and shortages from our suppliers. If we are unable to meet our customers' requirements and our competitors sufficiently expand production, we could lose customers and/or market share. These losses could have an adverse effect on our financial condition and results of operations. Also, capacity that we add during upturns in the business cycle may result in excess capacity during periods when demand for our products recedes, resulting in inefficient use of capital which could also adversely affect us.

If we are unable to attract and retain qualified personnel, especially our design and technical personnel, we may not be able to execute our business strategy effectively.

Our future success depends on our ability to retain, attract and motivate qualified personnel, including our management, sales and marketing, finance, and especially our design and technical personnel. As the source of our technological and product innovations, our design and technical personnel represent a significant asset. Any inability to retain, attract or motivate such personnel could have a material adverse effect on our business and results of operations.

We must continue to develop new products and technology to remain competitive

MostMany of the fundamental technologies used in the passive componentselectronics industry have been available for a long time. The market is subject to rapid changes in product designs and technological advances allowing for better performance and/or lower cost. New applications are frequently found for existing technologies, and new technologies occasionally replace existing technologies for some applications or open up new business opportunities in other areas of application. Successful innovation is critical for maintaining profitability in the face of potential erosion of selling prices for existing products. To address downward selling price pressure for our products and to meet market requirements, we must continue to develop innovative products and production techniques. Sustaining and improving our profitability depends a great deal on our ability to develop new products quickly and successfully meet changing customer specifications. Non-customized commodity products are especially vulnerable to price pressure, but customized products have also experienced selling price pressure over time. We have traditionally addressed downward pricing trends in part by offering products with new technologies or applications that offer our customers advantages over older products. We also seek to maintain profitability by developing products to our customers’ specifications that are not readily available from competitors. Developing and marketing these products requires start-up costs that may not be recouped 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 develop and market new products and applications in a timely fashion to satisfy customer demands. If this occurs, we could lose customers and experience adverse effects on our results of operations.

In addition to our own research and development initiatives, we may invest in technology start-up enterprises, in which we may acquire a controlling or non-controlling interest but whose technology would be available to be commercialized by us. There are numerous risks in investments of this nature, including the limited operating history of such start-up entities, their need for capital, their limited or absence of production experience, as well as the risk that their technologies may prove ineffective or fail to gain acceptance in the marketplace. There can be no assurance that our current and future investments in start-up enterprises will prove successful.

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 the world, are available from only a limited number of suppliers, or may be subject to significant fluctuations in market prices. Our results of operations may be adversely affected if we have difficulty obtaining these raw materials, our key suppliers experience financial 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 the manufacture of our products are subject to fluctuation and have experienced significant variability in the past. Our inability to recover increased costs through increased sales prices could have an adverse impact on our results of operations. For periods in which the prices for these raw materials rise, we may be unable to pass on the increased cost to our customers, which would result in decreased sales margins for the products in which they are used. For periods in which sales margins are declining, we may be required, as has occurred in the past, to write down our inventory carrying cost of these raw materials and products. Depending on the extent of the difference between market price and our carrying cost, the write-down could have a significant adverse effect on our results of operations.

We resell products manufactured by Kyocera, as well as other component and interconnect product manufacturers. Should these manufacturers experience difficulties supplying the products that we resell, or such suppliers use other channels to market their products, (see “Business; Products” in Item 1 elsewhere in this Form 10-K for additional information regarding changes in Kyocera sales channels), 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 because 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 of inventory correction as distributors increase or decrease their supply chain inventories based upon their anticipated market needs and economic conditions.

Our backlog is subject to customer cancellation

We generally do not obtain firm, long-term purchase commitments from our customers. Uncertain economic and geopolitical conditions have resulted in, and may continue to result in, some of our customers delaying the delivery of products that we manufacture or source for them and placing purchase orders for lower volumes of products than previously anticipated. Many of the orders that comprise our backlog may be canceled by our customers without penalty. Our customers may on occasion, order componentsproducts from multiple sources to ensure timely delivery when delivery lead times are particularly long and product delivery is a concern. They may cancel orders when business is weak and inventories are excessive, a situation that we have experienced during periods of economic slowdown. Therefore, we cannot be certain that the amount of our backlog does not exceed the level of sales that will ultimately be made. Our results of operations could be adversely impacted if customers cancel a material portion of orders in our backlog.

Our growth strategy may includes growth through acquisitions, which may involve significant risks

From time to time, we may make strategic acquisitions of other companies or businesses as we believe such acquisitions can help 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, risks and uncertainties of an acquisition strategy could include: (1) difficulties in integrating newly-acquired businesses and operations in an efficient and effective manner; (2) challenges in achieving strategic objectives, cost savings, and other benefits from acquisitions; (3) risk that markets do not evolve as anticipated and that the technologies acquired do not prove to be those needed to be successful in those markets; (4) potential loss of key employees of the acquired businesses; (5) risk of diverting the attention of senior management from our operations; (6) risks of entering new markets in which we have limited experience; (7) risks associated with integrating financial reporting and internal control systems; (8) difficulties in expanding information technology systems and other business processes to accommodate the acquired businesses; (9) future impairments of goodwill and other intangible assets of an acquired business; (10) unanticipated legal and regulatory issues in the jurisdictions of the acquired business; (11) liabilities for activities of the acquired businesses, including environmental, tax, and other known and unknown liabilities; and (12) additional costs related to plant closures, employee terminations, etc. could be incurred to create operating inefficiencies for AVX and a newly acquired entity.

Changes in our environmental liability and compliance obligations may adversely affect our operations or financial condition

Our manufacturing operations, products, and/or product packaging are subject to environmental laws and regulations governing air emissions; wastewater discharges; the handling, disposal, and remediation of hazardous substances, wastes, and certain chemicals used or generated in our manufacturing process; employee health and safety; labeling or other notifications with respect to the content or other aspects of our processes, products, or packaging; restrictions on the use of certain materials in or on design aspects of our products or product packaging; and responsibility for disposal of products or product packaging. We also operate, or did at one time, at sites that may have potential future environmental issues as a result of activities at such sites during the long history of manufacturing operations of 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 those jurisdictions may require us to address such issues. We establish reserves for specifically identified potential environmental liabilities when the liabilities are probable and reasonably estimated. Nevertheless, there can be no assurance we will not be obligated to address environmental matters that could have ana material adverse impact on our operations or financial condition. In addition, new environmental regulations may be enacted and we cannot presently determine the modifications, if any, in our operations that any such future regulations might require, or the cost of compliance with these regulations. In order to resolve liabilities at various sites, we have entered into various administrative orders and consent decrees, some of which may be, under certain conditions, reopened or subject to renegotiation. See “Environmental Matters” in Item 1 elsewhere in this Form 10-K for additional information.

Changes in regulatory compliance obligations may adversely affect 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 required 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 product manufactured, or contracted to be manufactured, by that issuer. The SEC issued a final rule on August 22, 2012. The minerals covered by the rules are commonly referred to as “3TG” and include tin, tantalum, tungsten, and gold. We use many of these materials in our production processes. The rule requires companies to perform due diligence, disclose, and report whether or not such minerals originate from the DRC and adjoining countries. In addition, weWe have incurred and will continue to incur additional costs to comply with thethese disclosure requirements, including costs related to determining the source of any of the relevant minerals and metals used in our products. Global supply chains are complicated with multiple layers and suppliers between the mine and the final product.

Historically, and prior to our participation in “Solutions for Hope,” we had a policy of not using tantalum sourced from the DRC or any other area in which insurgents or similar groups benefit from the sale of minerals. We continue to conduct extensive supply chain investigations to reduce risk and support supply chain sustainability in the region using the OECD guiding principles. AVX was the first in its industry to validate a “closed tantalum pipe” process, assuring all tantalum products contain only tantalum from smelters that have been independently verified under the Conflict Free Smelter program in accordance with the principles of the Dodd-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 are compliant with the EICC/RBC/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. During 2016 and in the spirit of continuous improvement envisioned and enshrined by the OECD Due Diligence guidance, AVX continues to improve supply chain sustainability and reduce compliance cost by field-testing a new alternate traceability platform (“BSP”) and proof of concept of a geological science technique for mineral matching (Geological Passporting) in the DRC region. The result of the BSP pilot demonstrated that a new costcompliance model is possible using technology for the reporting, analysis, chain of custody and Geo Passporting for validation. Please refer to the Solutions for Hope website for more information.

Our continued efforts affirm our commitment to supply products with conflict-free minerals to our customers and to comply fully with the OECD guidelines and SEC regulations. The implementation of Rule 1502 has not had a material adverse effect on our ability to source raw materials or manufacture products containing the “3TG” metals. We filed our most recent Form SD with the SEC on May 27, 2016.25, 2017.

We use significant amounts of electrical energy and processed ores in our production processes. Although its status is uncertain, the Kyoto Protocol is an international agreement that purports to set binding targets for signatory industrialized countries for reducing greenhouse gas emissions. Further, a number of governments or governmental bodies have introduced or are contemplating legislative and regulatory changechanges in response to the potential impacts of climate change that would limit and reduce greenhouse gas emissions. Any significant, sustained increase in energy costs could result in increases in our capital expenditures, operating expenses, and costs of important raw materials resulting in an adverse effect on our results of operations and financial condition.

The potential physical impacts of climate change on our operations are highly uncertain, and will be particular to the geographic circumstances. These effects may adversely influence the cost, production, and financial performance of our operations.

The European Union has adopted Regulation 2016/679 of the European Parliament and of the Council on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (General Data Protection Regulation) (“GDPR”), which will become effective on May 25, 2018. Other nations are similarly enacting new or updated privacy laws and regulations. It is still unclear how these privacy laws will impact our operations, but we expect that substantial resources will be required to conform our operations to comply with these laws.

Brexit adds additional uncertainty in one of our key markets

On June 23, 2016, the United Kingdom (U.K.) held a referendum in which voters approved an exit from the E.U., commonly referred to as “Brexit” and the U.K. Prime Minister has delivered a notice of withdrawal to the E.U. As a result, the British government will negotiateis negotiating the terms of the U.K.’s future relationship with the E.U.  Although it is unknown what those terms will be, it is possible that there will be greater restrictions on imports and exports between the U.K. and E.U. countries and increased regulatory complexities. These changes may adversely affect our operations and financial results.

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 to foreign exchange exposure due to changes in exchange rates of the various currencies. Volatility in exchange rates can affect our

sales, gross margins, and stockholders’ equity both positively and negatively. In order to minimize the effects of movements in

currency exchange rates, we enter into forward exchange contracts to hedge external and intercompany foreign currency transactions. In addition, we attempt to minimize currency exposure risk by producing our products in the same country or region in which the products are sold, thereby generating revenues and incurring expenses in the same currency. There can be no assurance that our approach will be successful, especially in the event of a significant and sudden decline in the value of any of the international currencies of our worldwide operations. We do not engage in purchasing forward exchange contracts for speculative purposes.

A significant portion of our cash, cash equivalents, and short-term investments are held by our foreignnon-U.S. subsidiaries

We generate a significant amount of cash and profits atfrom our foreignnon-U.S. subsidiaries. We expect that cash and profits generated by our foreign subsidiaries will continue to be reinvested indefinitely. However, liquidity requirements could necessitate transfers of existing cash balances between our subsidiaries or to the United States that may be subject to restrictions or result in unfavorable tax or earnings consequences. Approximately 86%71% of our cash and investment securities are held by our foreign subsidiaries. While

The Tax Cuts and Jobs Act (“TCJA”), enacted on December 22, 2017, transitions the U.S. from a worldwide tax system to a territorial tax system. Under previous law, companies could indefinitely defer U.S. income taxation on unremitted foreign earnings. The TCJA imposes a one-time transition tax on deferred foreign earnings of 15.5% for liquid assets and 8% for illiquid assets, payable in defined increments over eight years. As a result of this requirement, we intendexpect to use cash held outsidepay approximately $75.7 million over an eight year period, net of estimated applicable foreign tax credits.

As a result, previously deferred foreign earnings may now be repatriated to the United States to fund our international operationswithout additional U.S. federal taxation. However, any such repatriation could incur withholding and growth, if we encounter a significant need for liquidity domestically or at a particular location that we cannot fulfill through other internal or external sources, we may experience unfavorable taxforeign taxes in the source and earnings consequences due to cash transfers. These adverse consequences would occur, for example, if the transfer of cash into the United States is taxed and no offsettingintervening foreign tax credit is available to offset the U.S. tax liability, resulting in lower earnings.  We do not provide for U.S. taxes on the undistributed earnings of foreign subsidiaries that are considered to be reinvested indefinitely.jurisdiction.

Our operating resultsresults may be adversely affected by foreignnon-U.S. operations

We have significant international operations and our operating results and financial condition could be adversely affected by economic, political, health, regulatory, and other circumstances existing in foreign countries in which we operate. International manufacturing and sales are subject to inherent risks, including production disruption by employee union or works council actions, changes in local economic or political conditions, the imposition of currency exchange restrictions, unexpected changes in regulatory environments, potentially adverse tax law changes, changes in trade, import or export laws and regulations, and the exchange rate risk discussed above. Further, we have operations, suppliers, and customers in countries that are in the Pacific Basin which may be more susceptible to certain natural disasters, including earthquakes, tsunamis, and typhoons. Although we have operations around the world, a significant natural event could disrupt supply or production or significantly affect the market for some or all of our products. There can be no assurance that these factors will not have an adverse impact on our production capabilities or otherwise adversely affect our business and operating results.

In addition to specific country risks, our operations and sales are dependent on an integrated global operation. As a result, disruptions resulting from inter-governmental trade disputes, imposition of tariffs, imposition of trade sanctions, and direct conflict in locations such as the Korean peninsula could adversely affect our operations, growth, or profitability.

Our products are subject to stringent specifications and operating tolerances

All of our products are built to specifications and tested for adherence to such specifications before shipment to customers. We warrant that our products will meet such specifications. In the past, we have not incurred significant warranty claims. However, we have seen an increasing trend in the marketplace for claims related to end market product application failures or end-user recall or damage claims related to product defects, which could result in future claims that have an adverse impact on our results of operations.

Our ability to maintain our competitiveness depends, in part, on our maintaining the proprietorship of our technology

We will protect our proprietary rights as long as our proprietary technologies are maintained as trade secrets or are covered by recognized patents. We properly apply for, and will continue to apply for, patents covering our technologies. EachHowever, each patent application may not result in a successful patent issuance. Competitorsissuance and competitors may develop similar, alternative, or new technologies, which reduce the positive impact of our patents. In addition, competitors may challenge our patents, as has happened in the past, or seek to invalidate them, or operate in certain countries who do not recognize our legal patent rights. The protection of intellectual property involves multiple legal and factual issues, which makes the process difficult and potentially expensive.

We will vigorously defend our patent and intellectual property rights and may be involved in future litigation alleging our infringement of such rights from others. We willmay seek multiplevarious remedies to resolve these claims, including the normal practice of the offering or purchasing of licenses in an acceptable manner. An unfavorable outcome regarding these rights could have an adverse effect on our business and our results of operations.

Fluctuations in the market values of our investment portfolio could adversely affect our financial condition and operating results

Although we have not recognized any material losses related to our cash equivalents, short-term investments, or long-term investments, future declines in the market values of such investments could have an adverse effect on our financial condition and operating 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 such investments default on their obligations or their credit ratings are negatively impacted by liquidity, credit deterioration or losses, poor financial results, or other factors, the value of our cash equivalents, short-term investments, and long-term investments could decline and have an adverse effect on our financial condition and operating results.  results. In addition, our ability to find investments that are both safe and liquid and that provide a reasonable return may be impaired. This could result in lower interest income and/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 and limit exposure to credit risk on our trade receivables, there can be no assurance such procedures will effectively limit our credit risk and 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 operating results

We evaluate the credit quality of potential counterparties to derivative transactions and only enter into agreements with those deemed to have minimal credit risk at the time the agreements are executed. Our foreign exchange hedge portfolio is diversified across several credit line banks. Webanks and we carefully monitor the amount of exposure we have with any given bank. We also periodically monitor changes to counterparty credit quality as well as our concentration of credit exposure to individual counterparties. In some cases, we have master netting agreements that help reduce the risk of counterparty exposures. We do not hold or issue derivative financial instruments for trading or speculative purposes. Nevertheless, a credit crisis could have an impact on our hedging contracts if our counterparties are forced to file for bankruptcy or are otherwise unable to perform their obligations. If we are required to terminate hedging contracts prior to their scheduled settlement dates, we may be required to recognize losses that could have an adverse effect on our financial condition and operating results.

Returns on pension and retirement plan assets and interest rate changes could affect our operating results

The funding position of our defined benefit pension plans is influenced by the performance of the financial markets, and the discount rate used to calculate our pension obligations for funding and expense purposes. In the past, declines in the financial markets have negatively affected the value of the assets in our defined benefit pension plans. In addition, lower discount rates for actuarial purposes may result in increased pension contributions and expense.expense.

Funding obligations are generally determined under government regulations and measured periodically based on the value of the assets and liabilities determined on a specific date. If the financial markets do not provide the expected long-term returns, we could be required to make larger contributions. The financial markets can be, and in the recent past have been, very volatile, and therefore our estimate of future contribution requirements can change at any time. In a low interest rate environment, the likelihood of higher contributions in the future increases.increases.

We may not generate sufficient future taxable income, which may require additional valuation allowances against our deferred tax assets

As part of the process of preparing our consolidated financial statements, we are required to estimate our tax assets and liabilities in each of the jurisdictions in which we operate. This process involves management estimating the actual current tax liabilities together with assessing temporary differences resulting from different treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities that are included within our consolidated balance sheet.

We assess the likelihood that our deferred tax assets will be recoverable as a result of future taxable income and, to the 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 allowances are based on our estimates of future taxable income over the periods that our deferred tax assets will be recoverable.

We also record provisions for certain foreign and domestic 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 foreign tax authorities regarding the amount of taxes due. These challenges may result in adjustments to the timing or amount of taxable income or deductions or the allocation of income among tax jurisdictions. Further, during the ordinary course of business, other changing facts and circumstances may influence our ability to utilize tax benefits as well as the estimated taxes to be paid in future periods. In the event that actual results differ from our estimates, we may need to adjust tax accounts and related payments, which could materially affect 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 the actual tax rates or the time period within which the underlying temporary differences become taxable or deductible, we could be required to increase our valuation allowances resulting in an increase in our effective tax rate and have an adverse impact on future operating results.

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 and we could incur significant costs and reputational harm as a result

We rely on information technology networks and systems, including the Internet, to process, transmit, and store electronic and financial information; to manage a variety of business processes and activities; and to comply with regulatory, legal, and tax requirements. We also depend on our information technology infrastructure for digital marketing and sales activities and for electronic communications among our locations, personnel, customers, and suppliers around the world. Many of the information technology systems used by us globally have been in place for many years and not all hardware and software is currently supported by vendors. These information technology systems are susceptible to damage, disruptions, or shutdowns due to failures during the process of upgrading or replacing software, databases or components thereof, power outages, hardware failures, computer viruses, attacks by computer hackers, telecommunication failures, user errors, or catastrophic events. If our information technology systems suffer severe damage, disruption, or shutdown and our business continuity plans do not effectively resolve the issues in a timely manner, our product sales, financial condition, and results of operations may be materially affected, and we could experience delays in reporting our financial results.

Third-party service providers, such as distributors, subcontractors, vendors, and vendorsdata processors have access to certain portions of our sensitive data. In the event that these service providers do not appropriately protect our data, the result could be a security breach or loss of our data. Any such loss of data by our third-party service providers could have a material adverse impact on our business and results of operations.

In addition, if we are unable to prevent security breaches, we may suffer financial and reputational damage or penalties because 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 property or damage our reputation and brand image.

We are also in the process of converting certain information technology networks and systems and consolidating certain global systems. If such projects fail, or if unexpected technical difficulties arise, our operations and financial systems could be adversely affected. Further, we could incur additional costs or require additional technical support to resolve such difficulties.

Changes in global geopolitical and general economic conditions and other factors beyond our control may adversely affect our business

The following factors beyond our control could adversely affect our business:

We operate in a continually changing business environment and new factors emerge from time to time. Other unknown and unpredictable factors also could have either adverse or positive effects on our future results of operations or financial condition.

None.

Our fixed assets include manufacturing plants, warehouses, and machinery and equipment. In many instances, the machinery and equipment have been manufactured to our specifications and/or have special adaptations. Our plants, warehouses, machinery, and equipment are in good operating condition 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. OurExcluding acquisition related spending, our capital expenditures for plant and equipment were $26.6 million in fiscal 2015, $48.1 million in fiscal 2016, and $66.3 million in fiscal 2017.2017 and $100.5 million in fiscal 2018.

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

AVX manufactures products worldwide to support the Commercial, Automotive, Aerospace, Medical, and Medicalother markets. The appropriate ISO standard based on market requirements are in place and include but are not limited to ISO9001, AS9100 and ISO13485.

Virtually all of our manufacturing, research and development, and warehousing facilities could at any time be involved in the manufacturing, sale, or distribution of passiveelectronic components, (“PC”), interconnect, sensing and control device products (“CP”) or resale products (“RP”).products. The following is a list of our significant facilities and related information.

In addition to the foregoing, we lease a number ofhave many other less significant manufacturing, research, warehouse, sales officesoffice, and administrative office locations throughout the world. We do not anticipate difficulty in renewing existing leases as they expire or in finding alternative facilities, if necessary.

See “Environmental Matters” in Item 1"Item 1. Business" elsewhere in this Form 10-K for a discussion of our involvement as a PRP at certain environmental clean-up sites.

On April 25, 2013, AVX was named as a defendant in a patent infringement case filed in the United States District Court for the District of Delaware captioned Greatbatch, Inc. v. AVX Corporation. This case alleged that certain AVX products infringe on one or more of six Greatbatch patents. On January 26, 2016, the jury returned a verdict in favor of the plaintiff in the first phase of a segmented trial and a mixed verdict in the second phase of a segmented trial, and found damages to Greatbatch in the amount of $37.5 million. The damages award was later vacated by the court on March 30, 2018.  Profit from operations for the year ended March 31, 2018 reflects a favorable accrual adjustment of $1.5 million related to this patent infringement case.  The amount of damages will be subject to further legal proceedings including a potential trial on damages, which we would expect to occur in fiscal 2019. AVX is reviewing this initial verdict, consulting with its legal advisors on what action AVX may take in response, and continuing to litigate the rest of the case.

On September 2, 2014, a subsidiary of AVX, American Technical Ceramics (“ATC”), was named as a defendant in a patent infringement case filed in the United States District Court of the Southern District of DelawareCalifornia captioned Presidio Components, Inc. v. American Technical Ceramics Corp. This case alleged that certain ATC products infringe on a Presidio patent. On April 18, 2016, the jury returned a verdict in favor of the plaintiff and found damages to Presidio in the amount of $2.2 million.Presidio. On August 17, 2016, the court issued a permanent injunction prohibiting ATC from manufacturing or selling the related products after November 16, 2016 and awarded Presidio damages related to ATC’s sale of such products from February 21, 2016 through November 16, 2016. Subsequently, on October 21, 2016, the Federal Circuit Court granted AVX’s request for a stay of the permanent injunction whereby AVXATC was allowed to continue to sell the disputed product until March 17, 2017 to anyone who was a customer prior to June 17, 2016. Any sales subsequent to November 16, 2016 pursuant to the stay of the permanent injunction arewere subject to court mandated intellectual property damages for each product sold. Accordingly, in addition to the $2.2 million jury verdict award above, we recorded during fiscal yearIn December, 2017, an estimated reserve for damages on all pre- and post-verdict salesa panel of product subject to that litigation in the event that the verdict withstands future challenges. As of March 31, 2017, we have reserved $34.9 million related to the pre- and post-verdict sales of such product. On September 1, 2016 we filed an appeal with the Federal Circuit vacated the damage award to appeal this verdict.Presidio, vacated the injunction, and remanded the case for further proceedings to determine damages limited to “reasonable royalties” and to reconsider the requested injunction in light of its opinion and any additional facts.

As of March 31, 2017,2018, we had total reserves of $74.6$76.5 million plus accrued interest in accrued expenses with respect to the two intellectual property cases discussed above. The amounts recorded are based on estimated outcomes. Amounts recorded are reviewed periodically and adjusted to reflect additional information that becomes available. Accordingly, the actual costs related to these costscases could differ from our current estimates.

During calendar year 2014, AVX was named as a co-defendant in a series of cases filed in the United States and in the Canadian provinces of Quebec, Ontario, British Columbia, Saskatchewan and Manitoba alleging violations of United States, state and Canadian antitrust laws and asserting that AVX and numerous other companies were participants in alleged price-fixing in the capacitor market. The cases in the United States were consolidated into the Northern District of California on October 2, 2014. Some plaintiffs have broken off from the United States class action and filed actions on their own. Theseown, although AVX is not named in all of these independent actions. The cases in Canada have not been consolidated. All of these cases are still at their initial stages. in progress. AVX believes it has meritorious defenses and intends to vigorously defend the cases.

We are involved in other disputes, warranty claims, and legal proceedings arising in the normal course of business. While we cannot predict the outcome of these other disputes orand proceedings, we believe, based upon a review with legal counsel, that none of these other disputes or proceedings will have a material impact on our financial position, results of operations, comprehensive income (loss), or cash flows. However, we cannot be certain of the eventual outcome in these or other matters that may arise and their potential impact on our financial position, results of operations, comprehensive income (loss), or cash flows.

Not applicable.

PART II

Market for Common Stock

Our common stock is listed on the New York Stock Exchange and trades under the symbol “AVX.” At May 16, 2017,15, 2018, there were 196282 holders of record of the Company's common stock. In addition, there were numerous beneficial holders of the common stock, representing persons whose stock is held in nominee or “street name”“street name” accounts through brokers. The following table presents the high and low sale prices for our common stock on the New York Stock Exchange and the dividends declared per common share for each quarter for the fiscal years ended March 31, 20162017 and March 31, 2017.  On May 24, 2017, our Board of Directors declared a $0.11 dividend per share of common stock with respect to the quarter ended March 31, 2017.2018. Future dividends, if any, will be determined by the Company’s Board of Directors and may depend on the Company’s future profitability and anticipated operating cash requirements.

The name, address, and phone number of our stock transfer agent and registrar is:

The American Stock Transfer and Trust Company, LLC

6201 15^th Avenue

Brooklyn, NY 11219

1-800-937-54491-718-921-8300

Stock Performance Graph

The following chart shows, from the end of fiscal year 20122013 to the end of fiscal year 2017,2018, changes in the value of $100 invested in each of the Company’s common stock, Standard & Poor’s 500 Composite Index, and a peer group consisting of threetwo companies whose businesses are representative of our business segments. The companies in the peer group are Kemet Corporation and Vishay Intertechnology, Inc. Fairchild Semiconductor International, Inc. was dropped from the peer group since it was acquired by another company and delisted in 2016.

Purchases of Equity Securities by the Issuer

On October 17, 2007, the Board of Directors of the Company authorized the repurchase of up to 5,000,000 shares of our common stock from time to time on the open market. The repurchased shares are held as treasury stock and are available for general corporate purposes. The Company did not repurchase any shares during fiscal 2018. As of March 31, 2017,2018, there were 3,067,074 shares that may yet be repurchased under this program.

The following table sets forth selected consolidated financial data for AVX for the five preceding fiscal years ended March 31, 2017.31. The selected consolidated financial data for the five fiscal years ended March 31 2017 are derived from AVX’s audited consolidated financial statements. The consolidated financial data set forth below should be read in conjunction with AVX’s consolidated financial statements and the notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Form 10-K.

Selected Financial Data

(in thousands, except per share data)

data)

Overview

AVX Corporation is a leading worldwide manufacturer, supplier, and reseller of a broad line of passive electronic components and interconnect, sensing and control devices, and related products. Electronic components and connectorThese products manufactured or resold by AVX are used in virtually all types of electronicend use products, including those in telecommunications, automotive, transportation, energy harvesting, consumer electronics, military/aerospace, medical, computer, and industrial markets. We have five main product groups: Ceramic Components,Components; Tantalum Components,Components; Advanced Components,Components; Interconnect, Sensing and Control Devices (formerly AVX Interconnect); and Kyocera Electronic Devices.Devices (“KED”). These product lines are organized into three reportable segments: PassiveElectronic Components, Interconnect, Sensing and Control Devices, and KED Resale.

Consolidated revenues for the fiscal year ended March 31, 20172018 were $1,312.7 million with net income of $125.8$1,562.5 million compared to consolidated revenues of $1,195.5 million with net income of $101.5$1,312.7 million for the fiscal year ended March 31, 2016.2017. During fiscal 2017,2018, we saw an increase in sales due to a number of factors, including the effect of acquisitions and higher volumes across almost all of our product groups: Ceramic Components, Interconnect, and KED Resale products,groups resulting from improved global market conditions reflective of higher overall demand, primarily in the automotive, cellular telecommunications,defense, industrial, and industrialnetworking markets. The increase in revenue includes sales of $193.3 million in our Interconnect, Sensing and Control Devices segment and $12.7 million in our Electronic Components segment that are attributable to our acquisition of the AB Electronic sensing and control business ("S&C") and Ethertronics, Inc. ("Ethertronics"), respectively. In addition, approximately $6.3$42.5 million of thisthe increase in revenues is partially a result of the currency fluctuations throughoutmovement due to the year which we believe may have been influenced by the announcementstrength of the vote on the Referendum of the United Kingdom’s (U.K.) Membership of the European Union (E.U.) (referred to as “Brexit”) as well as the impact of other geopolitical issues which have resulted in a stronger Japanese Yen againstand Euro in relation to the U.S. Dollar and weaker European currencies againstwhen compared to the U.S. Dollar.same period last year.

Profit from operations for the year ended March 31, 2018 reflects a favorable accrual adjustment of $1.5 million related to an ongoing patent infringement case.

Profit from operations for the fiscal year ended March 31, 2017 includes post judgment charges of $34.9 million related to previously disclosed intellectual property damages awards resulting from litigation with respect to a patent infringement case filed in the United States District Court for the Southern District of DelawareCalifornia by Presidio Components, Inc. (“Presidio”). Net sales for the fiscal year ended March 31, 2017 includes $21.4 million from increased sales prices related to the affected products which have the effect of partially offsetting the effect of court awarded damages on all pre- and post-verdict sales of the product subject to the intellectual property damages awards, resulting in a net impact on profit from operations of $13.5 million for the current fiscal year.2017.

Additionally, profit from operations for the fiscal year ended March 31, 2017 reflects a charge of $3.6 million related to estimated environmental remediation costs resulting from legacy environmental issues at an inactive property.

Profit from operations for the fiscal year ended March 31, 2016 reflects charges of $45.3 million, of which $37.8 million is related to amounts awarded in patent infringement cases and $7.5 million is related to the settlement of certain litigation involving legacy environmental issues.

In fiscal 2017,2018, we generated $195.0$195.5 million of cash from operating activities. We used cash generated from operations to fund $28.3$83.1 million of general working capital requirements and $66.3$100.5 million of property and equipment purchases. We enhanced shareholdercontinued to use our resources to provide value as we spent $4.8to our stockholders by paying $290.3 million, to repurchase sharesnet of our common stock oncash and debt acquired, in connection with the markettwo business acquisitions and paid dividends of $72.0$75.7 million during fiscal year 2017.2018. Our financial position remains strong with approximately $1.1 billion$827.2 million of cash, cash equivalents, and securities investments and no borrowings as of March 31, 2017.2018.

We remain committed to investing in new products and improvements to our production facilities, manufacturing capacity and processes as well as continued investment in research, development, and engineering in order to provide our customers with new generations of passiveelectronic component and interconnect, sensing and control solutions. We are currently producing sophisticated electronic components and interconnectother devices necessitated by the breadth and increase in functionality of the electronic devices and increased electronic contentelectronics included in products such as smartcellular phones, wearable electronic devices, tablets, ultrabooks, netbooks, automobiles, planes, industrial equipment, medical devices, and renewable energy products that are manufactured by our customers. We have continued to focus on the sale of value-added advanced productselectronic components and interconnect, sensing and control solutions to serve thisthese expanding marketmarkets and enhance our operating margins. We are also focused on controlling and reducing costs to accommodate market sales price forces and offset rising operating costs. We do this by investing in automated manufacturing technologies, enhancing manufacturing materials and efficiencies, and rationalizing our production capabilities around the world. We believe that these strategies enable us to adapt quickly and benefit as market conditions change in order to provide shareholderstockholder value.

In addition, from time to time,During the fiscal year ended March 31, 2018 we completed two acquisitions. We may consider additional strategic acquisitions of other companies or businesses in the future in order to expand our product offerings or otherwise improve our market position.position and cost structure. We evaluate potential acquisitions in order to position ourselves to take advantage of profitable growth opportunities.

Outlook

Near-Term:

With uncertain global geopolitical and economic conditions, it is difficult to quantify expectations for fiscal 2018.2019. Near-term results for us will depend on the impact of the overall global geopolitical and economic conditions and their impact on telecommunications, information technology hardware, automotive, consumer electronics, and other electronic markets.markets as well as our effectiveness in integrating our acquisitions. Looking ahead, visibility is low and forecasting is a challenge in this uncertain and volatile market. We expect to see typical sales price pressure in the markets we serve due to competitive activity. In response to anticipated market conditions, we expect to continue to focus on cost management and product line rationalization to maximize earnings potential. We also continue to focus on process improvements and enhanced production capabilities in conjunction with our focus on the sales of value-added electronic components to support today’s advanced electronic devices.use products. If current global geopolitical and economic conditions worsen, the overall impact on our customers as well as end userend-user demand for electronic products could have a significant adverse impact on our near-term results.

In December 2016, Kyocera notified AVX pursuant to the Products Supply and Distribution Agreement in December 2016 of its intent, effective January 1, 2018, to market its manufactured passiveelectronic and interconnect products globally using Kyocera’s sales force rather than continuing to have AVX resell such products in the Americas, Europe and Asia. Kyocera will pay commissions to AVX on sales by Kyocera, in the applicable territories, of products designed into customer applications by AVX prior to January 1, 2018 of 2.0% in calendar year 2018, 1.5% in calendar year 2019, and 1.0% in calendar year 2020. Sales of Kyocera resale products were $318.9$296.3 million and related operating profit was $17.1$18.2 million for the fiscal year ended March 31, 2017.2018.

In February 2017, AVX notified Kyocera pursuant to the Products Supply and Distribution Agreement in February 2017 of its intent, effective April 1, 2018, to market its manufactured products in Japan using AVX’s sales force rather than continuing to have Kyocera resell such products in this territory. AVX will pay commissions to Kyocera on sales by AVX, in the applicable territory, of products designed into customer applications by Kyocera prior to April 1, 2018 of 2.0% in fiscal year 2019, 1.5% in fiscal year 2020, and 1.0% in fiscal year 2021. Sales of AVX resale products by Kyocera were $25.9$21.9 million for the fiscal year ended March 31, 2017.2018.

On October 2, 2017, AVX completed its acquisition of S&C for $162.1 million, net of cash acquired. The purchase includes S&C’s subsidiaries located in Austria, China, Germany, India, Mexico, Romania, South Korea, the U.K., and the U.S., including R&D, manufacturing and sales office locations.

On January 31, 2018, AVX completed its acquisition of Ethertronics for $128.2 million in cash, net of cash and debt acquired, subject to customary post-closing adjustments. Ethertronics operates facilities in six locations in China, South Korea, Vietnam, France, Taiwan, and the Americas, comprising R&D, manufacturing and sales office locations.

Long-Term:

Although there is uncertainty in the near-term market as a result of the current global geopolitical and economic conditions, we continue to see opportunities for long-term growth and profitability improvement due to: (a) a projected increase in the long-term worldwide demand for more sophisticated electronic devices,end use products, which require electronic components and interconnect, sensing and control devices such as the ones we sell, (b) cost reductions and improvements in our production processes, and (c) opportunities for growth in our Advanced ComponentElectronic Components and Interconnect, Sensing and Control Devices product lines due to advances in component design and our production capabilities.capabilities and capacity. We have fostered our financial health and the strength of our balance sheet putting us in a good position to react to changes in the marketplace as they occur. We remain confident that our strategies will enable our continued long-term success.

Results of Operations

Year Ended March 31, 2018 compared to Year Ended March 31, 2017

Net sales for the fiscal year ended March 31, 2018 were $1,562.5 million compared to $1,312.7 million for the fiscal year ended March 31, 2017.

The table below represents product group revenues for the fiscal years ended March 31, 2016, 2017, and 2018.

Electronic Component sales were $938.9 million for the fiscal year ended March 31, 2018 compared to $875.6 million during the fiscal year ended March 31, 2017. The sales increase in Electronic Components product sales was driven by increased volume in our Ceramic and Tantalum Components across most markets resulting from favorable global market conditions and increased demand for our electronic component products resulting from technological advances across a broad range of industries, including Internet of Things related products, industrial, telecommunications and automotive markets. Fiscal year 2018 sales also included $12.7 million of Ethertronics product sales. These increases were partially offset by sales decreases in our Advanced Components group primarily due to a reduction in sales of certain advanced ceramic capacitors which were the subject of intellectual property litigation whereby our sales of those products essentially ended in March of 2017.

Total Interconnect, Sensing and Control Devices product sales, including KCP Resale connectors, were $363.4 million in the fiscal year ended March 31, 2018 compared to $148.2 million during the fiscal year ended March 31, 2017. This increase is attributable to the additional sales resulting from our S&C acquisition which accounted for $193.3 million of the increased sales and increased demand in the U.S. and European automotive markets when compared to the fiscal year ended March 31, 2017.

KDP and KCD Resale sales were $260.2 million for the fiscal year ended March 31, 2018 compared to $288.9 million during the fiscal year ended March 31, 2017. This decrease is primarily a result of the planned phase out of KDP and KCD Resale products resulting from the previously announced decision by Kyocera to market its manufactured electronic component and interconnect products globally using Kyocera’s sales force rather than continuing to have AVX resell such products starting January 1, 2018.

Our sales to independent electronic distributors represented 42.7% of total net sales for the fiscal year ended March 31, 2018, compared to 44.5% for fiscal year ended March 31, 2017. Our S&C device sales are primarily direct to OEM customers, which led to the decrease in our distributor sales percentage when compared to the same period last year. Overall, distributor sales activity increased when compared to the same period last year as distributors increased order activity throughout the year in response to improved end-market demand and extended product delivery lead times. This increase in distributor activity is reflective of the increased customer demand, a more balanced inventory pipeline, and steadily improving market conditions. Our sales to distributor customers involve specific ship and debit and stock rotation programs for which sales allowances are recorded as reductions in sales. As a result of the increased distributors’ customer sales volume, such allowance charges increased to $30.5 million, or 4.6% of gross sales to distributor customers, for the fiscal year ended March 31, 2018 compared to $25.5 million, or 4.4% of gross sales to distributor customers, for the fiscal year ended March 31, 2017. Applications under such programs for fiscal years ended March 31, 2018 and 2017 were approximately $29.4 million and $24.9 million, respectively.

With the addition of S&C, whose sales are currently concentrated in Europe, the regional sales percentages of our total sales in the fiscal year ended March 31, 2018 decreased in the Asian and American regions while increasing in the European region compared to the fiscal year ended March 31, 2017. Sales in the Asian, American, and European regions represented 37.2%, 25.6% and 37.2% of total sales, respectively, for the fiscal year ended March 31, 2018. This compares to 44.1%, 29.1% and 26.8% of total sales for the Asian, American, and European regions in the prior year, respectively. As a result of the movement of the U.S. dollar against certain foreign currencies, reported sales for the fiscal year ended March 31, 2018 were favorably impacted by approximately $42.5 million when compared to the prior year.

Gross profit in the fiscal year ended March 31, 2018 was $318.9 million, compared to gross profit of $284.8 million in the fiscal year ended March 31, 2017. This overall increase in dollars is primarily attributable to higher sales. Gross profit as a percentage of sales for the fiscal year ended March 31, 2017 was 21.7% compared to 20.4% for the fiscal year ended March 31, 2018. The decline in gross profit as a percentage of sales is reflective of the sale of higher margin advanced ceramic capacitors during the fiscal year ended March 31, 2017 which were the subject of intellectual property litigation and were not being sold by us during the fiscal year ended March 31, 2018. For the fiscal year ended March 31, 2017, gross profit was negatively impacted by charges of approximately $34.9 million related to sales of those advanced ceramic capacitors subject to the intellectual property litigation discussed above, partially offset by $21.4 million from increased sales prices related to the affected products. In addition, we incurred increased costs of $4.2 million during the second half of the fiscal year ended March 31, 2018 for the effects of purchase accounting adjustments to inventory and fixed assets related to the S&C and Ethertronics acquisitions. For the fiscal year ended March 31, 2018, gross profit due to currency movement were unfavorably impacted by approximately $1.2 million when compared to the previous fiscal year.

Selling, general, and administrative expenses for the fiscal year ended March 31, 2018 were $140.5 million, or 9.0% of net sales, compared to $117.6 million, or 9.0% of net sales, for the fiscal year ended March 31, 2017. The overall increase in these expenses is primarily due to higher selling expenses resulting from the increase in sales and $3.6 million of amortization of intangible assets related to the S&C and Ethertronics acquisitions.

On September 2, 2014, a subsidiary of AVX, American Technical Ceramics (“ATC”), was named as a defendant in a patent infringement case filed in the United States District Court of the Southern District of California captioned Presidio Components, Inc. v. American Technical Ceramics Corp. This case alleged that certain ATC products infringe on a Presidio patent. On April 18, 2016, the jury returned a verdict in favor of the plaintiff and found damages to Presidio. On August 17, 2016, the court issued a permanent injunction prohibiting ATC from manufacturing or selling the related products after November 16, 2016. Subsequently, on October 21, 2016, the Federal Circuit Court granted AVX’s request for a stay of the permanent injunction whereby ATC was allowed to continue to sell the disputed product until March 17, 2017 to anyone who was a customer prior to June 17, 2016. Any sales subsequent to November 16, 2016 pursuant to the stay of the permanent injunction were subject to court mandated intellectual property damages for each product sold. In December, 2017, a panel of the Federal Circuit vacated the damage award to Presidio, vacated the injunction, and remanded the case for further proceedings to determine damages limited to “reasonable royalties” and to consider the requested injunction in light of its opinion and any additional facts. The case is ongoing.

Additionally, on January 26, 2016, in a patent infringement case filed in the United States District Court for the District of Delaware captioned Greatbatch, Inc. v. AVX Corporation the jury returned a verdict in favor of the plaintiff and found damages to the plaintiff in the amount of $37.5 million, which was recorded in fiscal 2016. That verdict was later vacated by the Court on March 30, 2018. Profit from operations for the year ended March 31, 2018 reflects a favorable accrual adjustment of $1.5 million related to this patent infringement case. The amount of damages will be subject to further legal proceedings including a potential trial on damages some time in fiscal 2019. In addition, during the fiscal year ended March 31, 2017, we accrued a $3.6 million estimated charge related to new environmental remediation activities related to a legacy environmental issue at a site referred to as the “Aerovox Site,” located in New Bedford, Massachusetts.

Profit from operations for the fiscal year ended March 31, 2018 increased $16.2 million to $179.8 million compared to $163.6 million for the fiscal year ended March 31, 2017. This increase is a result of the factors above.

Other income, net was $12.5 million in fiscal year 2018 compared to $11.4 million in fiscal year 2017. This increase is primarily attributable to foreign exchange gains resulting from currency fluctuations during the period, other income, net for the period ended March 31, 2017 includes a gain on the sale of an idle facility of $1.6 million in the fiscal year ended March 31, 2017.

The tax rate for the fiscal year ended March 31, 2018 was 97.4% compared to 28.1% for the fiscal year ended March 31, 2017. For the fiscal year ended March 31, 2018, compared to the fiscal year ended March 31, 2017, the increase in the tax rate is primarily a result of the Tax Cuts and Jobs Act (the “Act”) enacted in the U.S. on December 22, 2017. Among numerous other provisions, the Act reduced the statutory U.S. corporation income tax rate from 35% to 21%, effective January 1, 2018.  Excluding discrete items, the tax rate for the fiscal year ended March 31, 2018 was 28.0% compared to 27.8% for the fiscal year ended March 31, 2017.

The provision for income tax expense for the fiscal year ended March 31, 2018 was $187.4 million compared to $49.2 million for the fiscal year ended March 31, 2017. On December 22, 2017, the Tax Cuts and Jobs Act was enacted in the U.S. Among numerous other provisions, the Act reduced the statutory U.S. corporation income tax rate from 35% to 21%, effective January 1, 2018. The Act also reduced or eliminated certain corporate tax deductions and provided for a transition from a worldwide to a modified territorial tax system for resident corporations and related corporate group members.  The transition is accompanied by a one-time tax, effective December 31, 2017, on all U.S.-based corporate groups’ accumulated foreign earnings as yet untaxed by the U.S., assessed at a 15.5% rate on all such earnings held in cash or liquid asset positions and at an 8% rate on all other non-liquid asset positions. This estimated one-time tax was recorded in the results for the quarter ended December 31, 2017, and was approximately $75.7 million, which is payable in eight annual installments over an eight-year period, beginning in 2018. Also, in consideration of the Act, we have determined that it is no longer necessary to assert that cash and profits generated by our foreign subsidiaries will continue to be reinvested locally indefinitely. Accordingly, in addition to the one-time tax estimate noted above, we also provided for estimated foreign withholding taxes of approximately $13.6 million related to the potential distribution of such foreign earnings.

In addition, on December 21, 2017, the French Parliament enacted the Finance Law for 2018, which reduces France’s statutory corporate tax rate from its present 33.33% to 25%, in stages over the next five years.  This rate decrease resulted in an estimated net decrease in AVX’s French net deferred tax assets and liabilities of $14.2 million, which is also reflected as a discrete charge for the fiscal year ended March 31, 2018.

As a result of the factors discussed above, net income for the fiscal year ended March 31, 2018 was $4.9 million compared to $125.8 million for the fiscal year ended March 31, 2017.

Year Ended March 31, 2017 compared to Year Ended March 31, 2016

Net sales for the fiscal year ended March 31, 2017 were $1,312.7 million compared to $1,195.5 million for the fiscal year ended March 31, 2016.

The table below represents product group revenues for the fiscal years ended March 31, 2015, 2016, and 2017.

Passive

Electronic Component sales were $875.6 million for the fiscal year ended March 31, 2017 compared to $822.1 million during the fiscal year ended March 31, 2016. The sales increase in PassiveElectronic Components product sales was driven by increased volume across all of our electronic component groups as a result of improved global market conditions compared to the same period last year. Our Ceramic Components sales improvement is primarily due to increased activity in the cellular telecommunications and automotive markets in addition to our focus on the sale of higher value capacitance components. Much of the sales increase in our Advanced Components was primarily attributable to the accelerated sales, including $21.4 million from increased sales prices, of certain advanced ceramic capacitors at the request of our customers. These advanced ceramic capacitors were the subject of intellectual property litigation discussed below. The increase in sales of our Tantalum Components is primarily driven by increased demand in the telecommunications and industrial markets.

Total connector sales, including AVX Interconnect products and KCP Resale Connectors, were $148.2 million in the fiscal year ended March 31, 2017 compared to $135.4 million during the fiscal year ended March 31, 2016. This increase is attributable to increased demand in the U.S. and European automotive and industrial markets.

KDP and KCD Resale sales were $288.9 million for the fiscal year ended March 31, 2017 compared to $238.1 million during the fiscal year ended March 31, 2016. This increase is primarily attributable to higher demand from our cellular device customers, in addition to a favorable currency impact on reported revenues when compared to the same period last yearin fiscal 2016 as the Japanese Yen strengthened against the U.S. Dollar.

Our sales to independent electronic distributors represented 44.5% of total net sales for the fiscal year ended March 31, 2017, compared to 45.0% for fiscal year ended March 31, 2016. Overall, distributor sales increased when compared to the same period last year as distributors increased order activity and inventory intake during the year. This increase is reflective of the distributors’ customer demand, a more balanced inventory pipeline and steadily improving market conditions. Our sales to distributor customers involve specific ship and debit and stock rotation programs for which sales allowances are recorded as reductions in sales. As a result of the increased distributors’ customer demand and a more balanced inventory pipeline, suchsuch allowance charges decreased to $25.5 million, or 4.4% of gross sales to distributor customers, for the fiscal year ended March 31, 2017 compared to $29.4 million, or 5.5% of gross sales to distributor customers, for the fiscal year ended March 31, 2016. Applications under such programs for fiscal years ended March 31, 2017 and 2016 were approximately $24.9 million and $31.5 million, respectively.

Geographically, compared to the prior fiscal year, regional sales as a percentage of total sales for the fiscal year ended March 31, 2017 remained relatively consistent in all regions. Sales in Asia increased to 44.1% of total sales, while sales in the Americas

decreased slightly to 29.1% and sales in Europe decreased to 26.8% of total sales. This compares to 41.6%, 30.0%, and 28.4% of total sales for the Asian, American, and European regions in the prior year,fiscal 2016, respectively. As a result of the movement of the U.S. dollar against certain foreign currencies, reported sales for the fiscal year ended March 31, 2017 were favorably impacted by approximately $6.3 million when compared to the prior year.fiscal 2016.

Gross profit margin in the fiscal year ended March 31, 2017 decreased to 21.7% of sales, or $284.8 million, compared to a gross profit margin of 24.2% of sales, or $289.1 million, in the fiscal year ended March 31, 2016. This overall decrease in dollars and percent is primarily attributable to charges of $34.9 million related to sales of those advanced ceramic capacitors subject to the intellectual property litigation discussed above, partially offset by $21.4 million from increased sales prices related to the affected products. In addition, for the fiscal year ended March 31, 2017, the currency impact of the movement of the U.S. dollar against certain foreign currencies unfavorably impacted our gross profit by approximately $3.0 million when compared to the same period last year.

Selling, general, and administrative expenses for the fiscal year ended March 31, 2017 were $117.6 million, or 9.0% of net sales, compared to $119.8 million, or 10.0% of net sales, for the fiscal year ended March 31, 2016. The overall decrease in these expenses is primarily due to lower litigation costs partially offset by higher selling expenses resulting from the increase in sales for the fiscal year ended March 31, 2017 when compared to the fiscal year ended March 31, 2016.

On September 2, 2014, a subsidiary of AVX, American Technical Ceramics (“ATC”), was named as a defendant in a patent infringement case filed in the United States District Court of the Southern District of DelawareCalifornia captioned Presidio Components, Inc. v. American Technical Ceramics Corp. This case alleged that certain ATC products infringe on a Presidio patent. On April 18, 2016, the jury returned a verdict in favor of the plaintiff and found damages to Presidio in the amount of $2.2 million. On August 17, 2016, the court issued a permanent injunction prohibiting ATC from manufacturing or selling the related products after November 16, 2016 and awarded Presidio damages related to ATC’s sale of such products from February 21, 2016 through November 16, 2016. Subsequently, on October 21, 2016, the Federal Circuit Court granted AVX’s request for a stay of the permanent injunction whereby AVX was allowed to continue to sell the disputed product until March 17, 2017 to anyone who was a customer prior to June 17, 2016. Any sales subsequent to November 16, 2016 pursuant to the stay of the permanent injunction are subject to court mandated intellectual property damages for each product sold. Accordingly, in addition to the $2.2 million jury verdict award above, we recorded during fiscal year 2017 an estimated reserve for damages on all pre- and post-verdict sales of product subject to that litigation in the event that the verdict withstands future challenges. As of March 31, 2017, we havehad reserved $34.9 million related to the pre- and post-verdict sales of such product. On September 1, 2016, we filed an appeal with the Federal Circuit to appeal this verdict.

Additionally, on January 26, 2016, in a patent infringement case filed in the United States District Court for the District of Delaware captioned Greatbatch, Inc. v. AVX Corporation, the jury returned a verdict in favor of the plaintiff and found damages to the plaintiff in the amount of $37.5 million, which was recorded in fiscal 2016. In addition, during the fiscal year ended March 31, 2017, we accrued a $3.6 million estimated charge related to new environmental remediation activities related to a legacy environmental issue at a site referred to as the “Aerovox Site,” located in New Bedford, Massachusetts.

Profit from operations for the fiscal year ended March 31, 2017 increased $39.6 million to $163.6 million compared to $124.0 million for the fiscal year ended March 31, 2016. This increase is a result of the factors above.

Other income increased $3.2 million to $11.4 million in fiscal 2017 compared to $8.2 million in fiscal 2016. This increase is primarily attributable to foreign exchange gains resulting from currency fluctuations during the period in addition to a gain on the sale of an idle facility of $1.6 million.million.

The tax rate for the fiscal year ended March 31, 2017 was 28.1% compared to 23.2% for the fiscal year ended March 31, 2016. For the fiscal year ended March 31, 2017, compared to the fiscal year ended March 31, 2016, the increase in the tax rate is caused principally by an increase in our U.S. taxable income and an adverse U.S. federal audit adjustment, partially offset by increased U.S. foreign tax credits and the release of the valuation allowance against deferred tax assets at a Japanese subsidiary. Excluding discrete items, the tax rate for the fiscal year ended March 31, 2017 is 27.8% compared to 26.5% for the fiscal year ended March 31, 2016.

As a result of the factors discussed above, net income for the fiscal year ended March 31, 2017 was $125.8 million compared to $101.5 million for the fiscal year ended March 31, 2016.

Year Ended March 31, 2016 Compared to Year Ended March 31, 2015

Net sales for the fiscal year ended March 31, 2016 were $1,195.5 million compared to $1,353.2 million for the fiscal year ended March 31, 2015.

The table below represents product group revenues for the fiscal years ended March 31, 2014, 2015, and 2016.

Passive Component sales were $822.1 million for the fiscal year ended March 31, 2016 compared to $918.0 million during the fiscal year ended March 31, 2015. The sales decrease in Passive Components reflects a lower overall market demand across most of our product market segments related to soft global economic conditions, the unfavorable impact on reported sales of currency exchange as the U.S. dollar strengthened against certain foreign currencies and our focus on the sale of value added and higher capacitance components with higher margin opportunities and lower sales volumes rather than higher volume commodity components when compared to the fiscal year ended March 31, 2015. Lower sales is also reflective of our customers’ cautious inventory management programs during the fiscal year ended March 31, 2016.

Total connector sales, including AVX Interconnect products and KCP Resale Connectors, were $135.4 million in the fiscal year ended March 31, 2016 compared to $205.4 million during the fiscal year ended March 31, 2015. This decrease was primarily attributable to Kyocera’s decision to utilize their sales force rather than continuing to have AVX resell their connector products in Asia. Kyocera notified AVX in February 2014 of its intent, effective April 1, 2015, to market its connector products in Asia using Kyocera’s sales force rather than continuing to have AVX resell such products in Asia. Sales of Kyocera manufactured connector products in Asia were $1.1 million and $47.5 million with operating profit of $0.4 million and $1.9 million for the fiscal years ended March 31, 2016 and March 31, 2015, respectively. For more information regarding AVX’s relationship with Kyocera, see “Relationship with Kyocera and Related Transactions” below. In addition, there was a negative impact on reported sales resulting from the strength of the U.S. dollar when compared to the Japanese Yen and the Euro, partially offset by improved volumes to our automotive customers.  

KDP and KCD Resale sales were $238.1 million for the fiscal year ended March 31, 2016 compared to $229.9 million during the fiscal year ended March 31, 2015. This increase is primarily attributable to higher demand from our telecommunications and cellular device customers in the fiscal year ended March 31, 2016 partially offset by the unfavorable impact on reported sales of the stronger U.S. dollar when compared to the Japanese Yen.

Our sales to independent electronic distributors represented 45.0% of total net sales for the fiscal year ended March 31, 2016, compared to 45.7% for fiscal year ended March 31, 2015. Overall, distributor activity as a percentage of sales decreased slightly when compared to the same period in the prior year reflective of their cautious inventory management programs. Our sales to distributor customers may involve specific ship and debit and stock rotation programs for which sales allowances are recorded as reductions in sales. Such allowance charges decreased to $29.4 million, or 5.5% of gross sales to distributor customers, for the fiscal year ended March 31, 2016 compared to $33.6 million, or 5.4% of gross sales to distributor customers, for the fiscal year ended March 31, 2015. Applications under such programs for fiscal years ended March 31, 2016 and 2015 were approximately $31.5 million and $34.4 million, respectively.

Geographically, compared to the prior fiscal year, regional sales as a percentage of total sales for the fiscal year ended March 31, 2016 increased slightly in the Americas while decreasing slightly in Europe. Generally, all three geographic regions faced similar market conditions. Our Asian market sales were impacted Kyocera’s aforementioned decision to utilize their sales force rather than continuing to have AVX resell Kyocera manufactured connector products in this region. Sales in Asia remained 41.6% of total sales, while sales in the Americas increased slightly to 30.0% and sales in Europe decreased slightly to 28.4% of total sales.  This compares to 41.6%, 29.7%, and 28.7% of total sales for the Asian, American, and European regions in the prior year, respectively. As a result of the strength of the U.S. dollar against certain foreign currencies, reported sales for the year ended March 31, 2016 were unfavorably impacted by approximately $51 million when compared to the prior year.

Gross profit margin in the fiscal year ended March 31, 2016 decreased slightly to 24.2% of sales, or $289.1 million, compared to a gross profit margin of 24.3% of sales, or $328.6 million, in the fiscal year ended March 31, 2015. This overall decrease in dollars and percentage is primarily a result of lower sales volumes and lower selling prices reflective of soft demand in the global marketplace when compared to the same period last year. The impact on gross margin due to lower selling prices was partially offset by our focus on the sale of value added and higher capacitance passive components with better margin opportunities than higher volume commodity components. Gross profit also benefited from lower manufacturing and overhead costs due to our focus on cost control and manufacturing efficiencies. In addition, the currency impact of a stronger U.S. dollar against certain foreign currencies favorably impacted costs by approximately $59 million when compared to the same period last year.

Selling, general, and administrative expenses for the fiscal year ended March 31, 2016 were $119.8 million, or 10.0% of net sales, compared to $115.8 million, or 8.6% of net sales, for the fiscal year ended March 31, 2015. The overall increase in selling, general and administrative expenses is primarily due to higher legal advisory fees partially offset by lower selling expenses as a result of lower sales for the fiscal year ended March 31, 2016 compared to the fiscal year ended March 31, 2015.

During the fiscal ended March 31, 2016, we recorded estimated litigation and settlement charges of $45.3 million related to the outcome of certain litigation and remediation challenges involving legacy environmental issues and intellectual property litigation. Effective September 30, 2015, a Settlement Agreement and Mutual Release (“Settlement Agreement”) was entered into with the City of New Bedford in settlement of the following two cases: DaRosa v. City of New Bedford and City of New Bedford, et al v. AVX Corporation both arising from contamination at certain property sites in the City of New Bedford. In accordance with the Settlement Agreement, AVX paid the sum of $6.5 million to the City of New Bedford in October 2015. Additionally, on January 26, 2016, in a patent infringement case filed in the United States District Court for the District of Delaware captioned Greatbatch, Inc. v. AVX Corporation, the jury returned a verdict in favor of the plaintiff and found damages to the plaintiff in the amount of $37.5 million. Also, during the fourth quarter of the fiscal year ended March 31, 2016, we accrued a $1.3 million estimated charge related to a new environmental remediation demand related to a legacy environmental issue and a $0.4 million charge related to a recent jury finding with respect to an intellectual property lawsuit filed in the United States District Court for the District of Delaware captioned Presidio Components, Inc. v. American Technical Ceramics Corp.

Profit from operations for the fiscal year ended March 31, 2016 decreased $88.8 million to $124.0 million compared to $212.8 million for the fiscal year ended March 31, 2015. This decrease is a result of the factors above.

Other income increased $2.3 million to $8.2 million in fiscal 2016 compared to $5.9 million in fiscal 2015. This increase is primarily attributable to higher interest income resulting from an increase in the overall average balance of our cash and investments during fiscal 2016 when compared to fiscal 2015 and foreign currency exchange gains.

The tax rate for the fiscal year ended March 31, 2016 was a tax rate of 23.2% compared to a tax benefit of (3.3%) for the fiscal year ended March 31, 2015. For fiscal 2016, the rate of 23.2% is impacted by a reduction of income tax reserves related to the expiration of statutory periods with regard to certain income tax positions of approximately $4.4 million. Excluding such discrete items recorded during the fiscal year ended March 31, 2016, the effective tax rate would have been 26.5%. The tax rate for fiscal 2015 was impacted by net income tax benefits of $70.3 million primarily attributable to the reversal of valuation allowances of $50.0 million related to the forecasted future utilization of net operating loss carryforwards (“NOL’s”) in our European operations and net tax benefits of $17.5 million primarily due to the U.S. tax benefits related to the restructuring of certain foreign subsidiaries. Excluding such discrete items recorded during the fiscal year ended March 31, 2015, the effective tax rate would have been 28.9%.

The gross NOL’s related to the $50.0 million reversal of valuation allowances in the fiscal year ended March 31, 2015 were $149.9 million. The related tax benefits upon utilization of the NOL’s are un-expiring, however they are subject to annual utilization limitations. The realization of tax benefits due to the utilization of these NOL’s could take an extended period of time to realize and are contingent upon the foreign subsidiary’s continuing profitability.

As a result of the factors discussed above, net income for the fiscal year ended March 31, 2016 was $101.5 million compared to a $225.9 million for the fiscal year ended March 31, 2015.

Financial Condition

Liquidity and Capital Resources

Our liquidity needs arise primarily from working capital requirements, dividends, capital expenditures and capital expenditures. acquisitions. Historically, we have satisfied our operating liquidity requirements through funds from operations, investment income from cash and investments in securities, and cash on hand.hand. As of March 31, 2017,2018, we had a current ratio of 8.55.8 to 1, $1.1 billion$827.2 million of cash, cash equivalents, and investments in securities, $2,216.5$2,243.4 million of stockholders' equity and no borrowings. On December 22, 2017, the Act was enacted in the U.S. Among numerous other provisions, the Act reduced or eliminated certain corporate tax deductions and provided for a transition from a worldwide to a territorial tax system for resident corporations and related corporate group members. The transition is accompanied by a one-time tax, effective December 31, 2017, on all U.S.-based corporate groups’ accumulated foreign earnings as yet untaxed by the U.S., assessed at a 15.5% rate on all such earnings held in cash or liquid asset positions and at an 8% rate on all other non-liquid asset positions. This tax, approximately $75.7 million for us, is payable in installments over an eight-year period beginning in 2018.

As of March 31, 2017,2018, we had cash, cash equivalents, and short-term investments in securities of $1.1 billion,$827.2 million, of which $957.2$585.8 million was held outside the U.S. Liquidity is subject to many factors, such as normal business operations as well as general economic, financial, competitive, legislative, and regulatory factors that are beyond our control. Cash balances generated and held in foreign locationsoutside the U.S. are generally used for theirlocal on-going working capital, capital expenditure needs, and to support regional acquisitions. These balances are currently expectedIn consideration of the Act, we have determined that it is no longer necessary to assert that cash and profits generated by our foreign subsidiaries will continue to be permanently reinvested outside the U.S. If these funds were needed for general corporate purposeslocally indefinitely. Accordingly, in the U.S., we would incur significant income taxes to repatriateaddition to the U.S. taxes on such earnings noted above, we also provided for estimated foreign withholding taxes of approximately $13.6 million related to the potential distribution of such foreign earnings. As a result of the Act we will have greater flexibility to redirect our global cash held in foreign locations. In addition, local government regulations may restrict our ability to move funds among various locations under certain circumstances. Management does not believe such restrictions would limit our ability to pursue our intended business strategies.resources where they are needed.

Net cash provided by operating activities was $195.5 million for the fiscal year ended March 31, 2018, compared to cash provided by operations of $195.0 million for the fiscal year ended March 31, 2017 compared toand cash provided by operations of $166.4 million for the fiscal year ended March 31, 2016 and cash provided by operations of $197.6 million for the fiscal year ended March 31, 2015.2016.

Purchases of property and equipment totaled $100.5 million in fiscal 2018, $66.3 million in fiscal 2017, and $48.1 million in fiscal 2016, and $26.6 million in fiscal 2015.2016. The increase in expenditures during fiscal 2017 were2018 was primarily made in connection with strategic building expansion and equipment purchase activities in our Fountain Inn, operationsSouth Carolina facilities and our plants in Mexico, Malaysiathe Czechia, Germany, El Salvador, and the Czech Republic.Malaysia. We expect to continue to make strategic capital investments in our PassiveElectronic Component and Interconnect, Sensing and Control Devices product lines and estimate that we will incur capital expenditures of approximately $50$85 million in fiscal 2018.2019. The actual amount of capital expenditures will depend upon the outlook for end market demand and timing of capital projects.

On October 2, 2017, AVX completed its acquisition of S&C for $162.1 million, net of cash acquired. The purchase comprises S&C’s subsidiaries located in Austria, China, Germany, India, Mexico, Romania, South Korea, the U.K., and the U.S., including R&D, manufacturing and sales office locations.

During the quarter ending March 31, 2018, AVX completed its acquisition of Ethertronics for $128.2 million in cash, net of debt acquired, subject to customary post-closing adjustments. Ethertronics operates facilities in six locations in China, South Korea, Vietnam, France, Taiwan, and the Americas, comprising R&D, manufacturing and sales office locations.

Historically, our operating funding has been internally generated through operations, investment income from cash, cash equivalents, and investments in securities and cash on hand. We have assessed the condition of our financial resources and our current business and believe that, based on our financial condition as of March 31, 2017,2018, cash on hand and cash expected to be generated from operating activities and investment income from cash, cash equivalents, and investments in securities will be sufficient to satisfy our anticipated financing needs for working capital, capital expenditures, environmental clean-up costs, expenses related to ongoing litigation, pension plan funding, research, development, and engineering expenses, and dividend payments or stock repurchases to be made during the upcoming year.next twelve months. While changes in customer demand have an impact on our future cash requirements, changes in those requirements are mitigated by our ability to adjust manufacturing capabilities to meet increases or decreases in customer demand. In addition, potential acquisitions, depending upon their size, could require us to utilize our current cash resources, or use external borrowings. We do not anticipate any significant changes in our ability to generate cash flows or meet our liquidity needs in the foreseeable future.

In fiscal 2018, 2017, 2016, and 2015,2016, dividends of $75.7 million, $72.0 million, $70.5 million, and $67.3$70.5 million, respectively, were paid to stockholders.

On October 17, 2007, the Board of Directors of the Company authorized the repurchase of up to 5,000,000 shares of our common stock. We did not purchase any shares during fiscal 2018. We purchased 356,364 shares at a cost of $4.8 million during fiscal 2017, and 761,145 shares at a cost of $10.2 million during fiscal 2016, and 524,806 shares at a cost of $7.2 million during fiscal 2015.2016. The repurchased shares are held as treasury stock and are available for general corporate purposes. As of March 31, 2017,2018, there were 3,067,074 shares that may yet be repurchased under this program.

At March 31, 2017,2018, we had contractual obligations for the construction of plants and acquisition of equipment aggregating approximately $29.0$51.2 million.

We make contributions to our U.S. and foreign defined benefit plans as required under various pension funding regulations. Contributions are based on a percentage of pensionable wages or requirements necessary to satisfy long-term funding obligations. We made contributions of $3.0$0.3 million to our U.S. and $6.6$6.1 million to our foreign defined benefit plans during the fiscal year ended March 31, 2017.2018. We expect to make contributions of approximately $6.2$6.6 million for our foreign defined benefits plans for the fiscal year ending March 31, 2018.2019. We do not anticipate making contributions to the U.S. plans in fiscal 2018.2019. We have unfundedfunded actuarially computed pension liabilitiesassets of approximately $10.1$12.9 million related to these defined benefit pension plans as of March 31, 2017. 2018.

During the fiscal year ended March 31, 2017,2018, we made contributions of $4.4 million to Company sponsored retirement savings plans. Our contributions are partially based on employee contributions as a percentage of their salaries. Certain of our contributions to these savings plans are discretionary and are determined by the Board of Directors each year. We expect that our contributions for the fiscal year ending March 31, 20182019 will be approximately $4.4 million.

We are a lessee under long‑termlong-term operating leases primarily for office space, plant, and equipment. Future minimum lease commitments under non‑cancelablenon-cancelable operating leases as of March 31, 2017,2018, were approximately $18.7$21.6 million.

Occasionally 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 or other private parties as a potentially responsible party (“PRP”) under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), or equivalent non-U.S., state or local laws, for clean-up and response costs associated with certain sites at which remediation is or may be required with respect to prior contamination. Because CERCLA andor such state statutes authorize joint and several liability, the EPA or non-U.S., state or local regulatory authorities could seek to recover all clean-up costs from any one of the PRPs at a site despite the involvement of other PRPs. At certain sites, financially responsible PRPs other than AVX also are, or have been, involved in site investigation and clean-up activities. We believe that liability resulting from these sites will be apportioned 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 orders and 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 remedy contain provisions allowing the EPA to reopen the agreement and seek additional amounts from settling PRPs in the event that certain contingencies occur, such as the discovery of significant new information about site conditions.

On June 3, 2010, AVX entered into an agreement with the EPA and the City of New Bedford, pursuant to which AVX is 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 New Bedford with respect to the satisfaction of AVX’s federal law requirements. Agreements withThe Massachusetts Department of Environmental Protection has jurisdiction over the balance of the environmental remediation at the Site. AVX has submitted its proposed remedy, but until the state regulatory authorities are not concluded yet but are likely to includehas approved such proposal, AVX cannot determine if additional groundwater and soil remediation will be required, if substantial material will have to be disposed of offsite, or if additional remediation techniques will be required, any of which could result in a more extensive and costly plan of remediation. Further, the Site and the remediation may be subject to additional scrutiny under other statutory procedures which could also add to the cost of remediation. We have a remaining accrual of $15.1$14.2 million at March 31, 2017,2018, representing our estimate, including a $3.6 million charge in the current fiscal year,estimate of the potential liability related to the remaining performance of environmental remediation actions at the Site and neighboring properties using certain assumptions regarding the plan of remediation. Since additional sampling and analysis may cause the state regulatory authority, the Massachusetts Department of Environmental Protection, to require a more extensive and costly plan of remediation, untilUntil all parties agree and remediation is complete, we cannot be certain there will be no additional cost relating to the Site.

We had total reserves of approximately $16.8$19.2 million and $19.2$18.6 million at March 31, 20162017 and March 31, 2017,2018, respectively, related to various environmental matters and sites, including those discussed above. These reserves are classified in the Consolidated Balance Sheets as $7.4$3.9 million and $3.9$3.3 million in accrued expenses at March 31, 20162017 and March 31, 2017,2018, respectively, and $9.4 million and $15.3 million in other non-current liabilities at both March 31, 20162017 and March 31, 2017, respectively.2018. The amounts recorded for identified environmental liabilities are based on estimates. Periodically, we review amounts recorded and adjust them to reflect additional legal and technical information that becomes available. 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 aggregate environmental remediation exposure. Accordingly, these costs could differ from our current estimates.