TTM Technologies, Inc. Reports Third Quarter 2007 Results

SANTA ANA, Calif.--(BUSINESS WIRE)--

TTM Technologies, Inc. (Nasdaq:TTMI), North America's largest printed circuit board (PCB) manufacturer, today reported results for the third quarter of 2007, ended October 1, 2007.

    Third Quarter 2007 Highlights

    --  TTM reported strong results for the third quarter, with
        sequential improvement in all financial metrics.

    --  The Company continued to pay down debt associated with the
        Printed Circuit Group (PCG) acquisition, ahead of schedule.
        TTM paid down $11 million in debt during the third quarter.

    --  The Company reported a Book to Bill ratio of 1.23, exceeding
        the North American Industry PCB Book to Bill ratio of 1.08 for
        the three months ending in September 2007.

    Third Quarter 2007 Financial Results

Third quarter net sales of $163.1 million improved over second quarter 2007 net sales of $162.0 million, primarily due to increasing demand for TTM's high-tech manufacturing services.

Third quarter gross margin of 19.2 percent increased 100 basis points from 18.2 percent gross margin reported in the second quarter of 2007.

Selling and marketing expense for the third quarter of 2007 was $7.1 million, representing 4.4 percent of sales. This compares to second quarter 2007 selling and marketing expense of $7.6 million, representing 4.7 percent of sales.

General and administrative expense, including amortization of intangibles, for the third quarter of 2007 was $9.0 million, representing 5.5 percent of sales. This compares to second quarter 2007 general and administrative expense, including amortization of intangibles, of $8.9 million, representing 5.5 percent of sales.

TTM posted operating income of $15.2 million for the third quarter of 2007, compared to $13.1 million for the second quarter of 2007.

Net income for the third quarter of 2007 was $8.2 million, or $0.19 per diluted share. This compares with net income of $6.2 million, or $0.15 per diluted share, in the second quarter of 2007.

EBITDA (earnings before interest, taxes, depreciation and amortization) for the third quarter of 2007 was $22.2 million, compared with second quarter 2007 EBITDA of $20.1 million. (A reconciliation of this non-GAAP measure is provided after the GAAP financial statements accompanying this press release.)

"Robust demand for high-tech manufacturing services, combined with continued strength from our aerospace/defense customers, contributed to strong third quarter financial results," said Kent Alder, President and CEO of TTM. "However, the strong demand was tempered by softness in the computing end market." Alder concluded, "The Company had a strong level of bookings as evidenced by our book-to-bill ratio, which significantly exceeded the industry ratio and has rebounded from the beginning of the year."

Third Quarter Segment Information - PCB Manufacturing and Backplane Assembly

TTM Technologies' two reportable operating segments are PCB Manufacturing and Backplane Assembly.

For the PCB Manufacturing segment, net sales (before inter-segment sales) were $140.5 million in the third quarter of 2007, compared with $138.7 million in the second quarter of 2007. Operating segment income (before amortization of intangibles) was $13.9 million in the third quarter of 2007, compared with $12.0 million in the second quarter of 2007.

For the Backplane Assembly segment, net sales (before inter-segment sales) were $30.7 million in the third quarter of 2007, compared with $32.2 million in the second quarter of 2007. Operating segment income (before amortization of intangibles) was $2.3 million in the third quarter of 2007, compared with $2.1 million in the second quarter of 2007.

Balance Sheet

Cash and short-term investments at the end of the third quarter of 2007 totaled $27.3 million, compared with $26.1 million at the end of the second quarter of 2007.

In the third quarter of 2007, TTM continued to pay down debt associated with the PCG acquisition significantly ahead of schedule. During the quarter, the Company reduced debt by $11 million, reducing the debt balance to $109 million at the end of the quarter. In October, the company repaid an additional $10 million. It is noteworthy that the Company has cut its debt in half in roughly one year's time. As a result, the corresponding interest expense is expected to be lower in future quarters.

Fourth Quarter Forecast

For the fourth quarter of 2007, TTM estimates revenues in a range of $164 million to $172 million and earnings in a range of $0.18 to $0.23 per diluted share. "The strength that we are seeing for the fourth quarter is broad-based across all of our end markets," said Alder. "We are pleased with our execution toward improving operational efficiency, and we believe that our increased size optimally positions us to continue to deliver best-in-class solutions to our customers and solid bottom-line financial performance."

To Access the Live Web Cast/Conference Call

The company will host a conference call to discuss the third quarter results and fourth quarter outlook on October 31, 2007, at 4:30 p.m. Eastern Daylight Time (1:30 p.m. Pacific Daylight Time).

To listen to the live web cast, log on to the TTM Technologies website at http://www.ttmtech.com. To access the live conference call, dial 303-262-2130 or 800-218-0204.

To Access a Replay of the Web Cast

A digital replay will be available on TTM Technologies' website at http://www.ttmtech.com and will remain accessible for one week following the live event.

A telephone replay also will be available beginning two hours after the conclusion of the conference call until November 2, 2007. You may access the telephone replay by dialing 303-590-3000 or 800-405-2236 and entering confirmation code 11100051#.

Safe Harbor Statement

This release contains forward-looking statements that relate to future events or performance. These statements reflect the company's current expectations, and the company does not undertake to update or revise these forward-looking statements, even if experience or future changes make it clear that any projected results expressed or implied in this or other company statements will not be realized. Furthermore, readers are cautioned that these statements involve risks and uncertainties, many of which are beyond the company's control, which could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties include, but are not limited to, the company's dependence upon the electronics industry, the company's dependence upon a small number of customers, general economic conditions and specific conditions in the markets TTM addresses, the unpredictability of and potential fluctuation in future revenues and operating results, increased competition from low-cost foreign manufacturers and other "Risk Factors" set forth in the company's most recent SEC filings.

About TTM

TTM Technologies, Inc. is North America's largest printed circuit board manufacturer, focusing on quick-turn and technologically advanced PCBs and the backplane and sub-system assembly business. TTM stands for time-to-market, representing how the company's time-critical, one-stop manufacturing services enable customers to shorten the time required to develop new products and bring them to market. Additional information can be found at www.ttmtech.com.

                        TTM TECHNOLOGIES, INC.

               Selected Unaudited Financial Information

                (In thousands, except per share data)



                     ------------------- --------- -------------------
                                          Second   First Three Fiscal
                        Third Quarter     Quarter        Quarters
                     ------------------- --------- -------------------
                       2007      2006      2007      2007      2006
                     --------- --------- --------- --------- ---------

CONSOLIDATED
 STATEMENTS OF
 OPERATIONS

Net sales            $163,079  $ 75,765  $162,016  $501,992  $225,136
Cost of goods sold    131,834    53,288   132,470   406,480   159,487
                     --------- --------- --------- --------- ---------

Gross profit           31,245    22,477    29,546    95,512    65,649
                     --------- --------- --------- --------- ---------

Operating expenses:
  Selling and
   marketing            7,101     3,329     7,551    22,212    10,142
  General and
   administrative       7,951     3,822     7,890    24,183    11,069
  Amortization of
   intangibles          1,019       300     1,046     3,090       901
                     --------- --------- --------- --------- ---------
    Total operating
     expenses          16,071     7,451    16,487    49,485    22,112
                     --------- --------- --------- --------- ---------

Operating income       15,174    15,026    13,059    46,027    43,537

Interest expense       (2,628)      (35)   (3,368)  (11,094)     (141)
Interest income and
 other, net               321     1,369       236     1,316     3,464
                     --------- --------- --------- --------- ---------

Income before income
 taxes                 12,867    16,360     9,927    36,249    46,860
Income tax provision   (4,666)   (5,837)   (3,743)  (13,399)  (16,970)
                     --------- --------- --------- --------- ---------

Net income           $  8,201  $ 10,523  $  6,184  $ 22,850  $ 29,890
                     ========= ========= ========= ========= =========

Earnings per common
 share:
  Basic              $   0.19  $   0.25  $   0.15  $   0.54  $   0.72
  Diluted            $   0.19  $   0.25  $   0.15  $   0.54  $   0.71

Weighted average
 common shares:
  Basic                42,260    41,823    42,199    42,203    41,651
  Diluted              42,625    42,310    42,496    42,506    42,265



SELECTED BALANCE
 SHEET DATA
                     -------------------
                     October   December
                      1, 2007   31, 2006
                     --------- ---------
Cash and short-term
 investments         $ 27,315  $ 70,656
Accounts receivable,
 net                  115,304   125,435
Inventories, net       66,333    67,020
Total current assets  222,809   271,748
Net property, plant
 and equipment        124,291   150,837
Other assets          157,137   151,113
Total assets          504,237   573,698

Current portion
 long-term
 liabilities         $ 50,000  $ 60,705
Accounts Payable       50,363    49,276
Current liabilities   128,068   144,343
Long-term
 liabilities           61,360   142,040
Stockholders' equity  314,809   287,315
Total liabilities
 and stockholders'
 equity               504,237   573,698
                     -------------------

SUPPLEMENTAL DATA
                     ------------------- --------- -------------------
                                          Second   First Three Fiscal
                        Third Quarter     Quarter        Quarters
                     ------------------- --------- -------------------
                       2007      2006      2007      2007      2006
                     --------- --------- --------- --------- ---------
EBITDA               $ 22,174  $ 19,001  $ 20,113  $ 67,755  $ 55,122
EBITA                $ 16,543  $ 16,725  $ 14,369  $ 50,520  $ 47,990

Gross margin             19.2%     29.7%     18.2%     19.0%     29.2%
EBITDA margin            13.6      25.1      12.4      13.5      24.5
Operating margin          9.3      19.8       8.1       9.2      19.3

End Market
 Breakdown:
                     -------------------
                        Third Quarter
                     -------------------
                       2007      2006
                     --------- ---------

  Networking /
   Communications          40%       43%
  Aerospace /
   Defense                 32        12
  Computing /
   Storage /
   Peripherals             13        34
  Medical /
   Industrial /
   Instrumentation /
   Other                   15        11

Stock-based
 Compensation:
                     ------------------- ---------
                                          Second
                        Third Quarter     Quarter
                     ------------------- ---------
                       2007      2006      2007
                     --------- --------- ---------
  Amount included
   in:
    Cost of goods
     sold            $    258  $    135  $    255
    Selling and
     marketing             55        39        48
    General and
     administrative       609       276       581
                     --------- --------- ---------
    Total stock-
     based
     compensation
     expense         $    922  $    450  $    884
                     ========= ========= =========


Operating Segment
 Data:
                     --------- --------- ---------
                                          First
                                           Three
                      Third     Second    Fiscal
                      Quarter   Quarter   Quarters
                     --------- --------- ---------
  Net sales:           2007      2007      2007
                     --------- --------- ---------
  PCB Manufacturing   140,514   138,651   431,316
  Backplane Assembly   30,679    32,164    96,500
                     --------- --------- ---------
    Total Sales       171,193   170,815   527,816
  Inter-Segment
   Sales               (8,114)   (8,799)  (25,824)
                     --------- --------- ---------
    Total Net Sales  $163,079  $162,016  $501,992
                     --------- --------- ---------

  Operating Segment
   Income:
  PCB Manufacturing    13,899    12,019    42,285
  Backplane Assembly    2,294     2,086     6,832
                     --------- --------- ---------
    Total Op Segment
     Income            16,193    14,105    49,117
  Amortization of
   Intangibles         (1,019)   (1,046)   (3,090)
                     --------- --------- ---------
    Total Op Income    15,174    13,059    46,027
  Total Other Income
   (Expense)           (2,307)   (3,132)   (9,778)
                     --------- --------- ---------
  Income Before
   Income Taxes      $ 12,867  $  9,927  $ 36,249
                     ========= ========= =========

RECONCILIATIONS*
                     ------------------- --------- -------------------
                                          Second   First Three Fiscal
                        Third Quarter     Quarter        Quarters
                     ------------------- --------- -------------------
                       2007      2006      2007      2007      2006
                     --------- --------- --------- --------- ---------
EBITA/EBITDA
 reconciliation:
  Net income         $  8,201  $ 10,523  $  6,184  $ 22,850  $ 29,890
  Add back items:
    Income taxes        4,666     5,837     3,743    13,399    16,970
    Interest expense    2,628        35     3,368    11,094       141
    Amortization of
     intangibles        1,048       330     1,074     3,177       989
                     --------- --------- --------- --------- ---------
  EBITA                16,543    16,725    14,369    50,520    47,990

  Depreciation
   expense              5,631     2,276     5,744    17,235     7,132
                     --------- --------- --------- --------- ---------
  EBITDA             $ 22,174  $ 19,001  $ 20,113  $ 67,755  $ 55,122
                     ========= ========= ========= ========= =========

* This information provides a reconciliation of EBITA/EBITDA to the
 financial information in our consolidated statements of operations.


"EBITDA" means earnings before interest expense, income taxes,
 depreciation and amortization. "EBITA" means earnings before interest
 expense, income taxes and amortization. We present EBITDA / EBITA to
 enhance the understanding of our operating results. EBITDA / EBITA is
 a key measure we use to evaluate our operations. In addition, we
 provide our EBITDA / EBITA because we believe that investors and
 securities analysts will find EBITDA / EBITA to be a useful measure
 for evaluating our operating performance and comparing our operating
 performance with that of similar companies that have different
 capital structures and for evaluating our ability to meet our future
 debt service, capital expenditures, and working capital requirements.
 However, EBITDA / EBITA should not be considered as an alternative to
 cash flows from operating activities as a measure of liquidity or as
 an alternative to net income as a measure of operating results in
 accordance with accounting principles generally accepted in the
 United States of America.

Source: TTM Technologies, Inc.