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TTM Technologies, Inc. Reports First Quarter 2002 Results

REDMOND, Wash., Apr 29, 2002 /PRNewswire-FirstCall via COMTEX/ -- TTM Technologies, Inc. (Nasdaq: TTMI), a leading manufacturer of time-critical, technologically advanced printed circuit boards, today reported results for the first quarter ended April 1, 2002.

First-Quarter Results

In the first quarter, revenue and profitability declined, year-over-year, due to continued weakness in the electronics industry. Net sales declined 48 percent to $23.7 million, compared to $46.0 million for the first quarter of 2001. Gross profit declined 87 percent to $2.3 million, as gross margins declined to 9.9 percent in the first quarter of 2002, compared to 39.8 percent for the same period in 2001.

As a result of lower volume and pricing and reduced absorption of fixed manufacturing overhead, the company reported an operating loss of $0.2 million in the first quarter of 2002, compared to operating income of $12.6 million for the first quarter of 2001. Prior period results included a quarterly goodwill amortization charge of $0.9 million, which was eliminated with the adoption of Statement of Financial Accounting Standards No. 142, in the first quarter of 2002.

For the first quarter of 2002, the net loss was $0.3 million, or $0.01 per diluted share, compared to net income of $7.6 million, or $0.19 per diluted share, for the same period in 2001. Cash earnings were $22,000, or breakeven on a per share basis, for the first quarter of 2002, compared to $8.8 million, or $0.23 per diluted share, for the same period in 2001.

Earnings before interest, taxes, depreciation and amortization (EBITDA) declined 85 percent to $2.4 million for the first quarter of 2002, compared to $15.9 million for the same period in 2001.

"Over the course of the quarter, we saw some strengthening of demand in our quick-turn business," said Kent Alder, President and CEO of TTM Technologies. For the first quarter of 2002, quick-turn business increased to 44 percent of total revenues, compared to 38 percent for the first quarter of 2001.

"In a challenging business environment, we remained near breakeven in the first quarter, due to the success of our sales efforts and effective cost controls," said Alder. "Not only did we add approximately 40 new customers during the quarter, we expanded existing customer relationships, which is reflected in two additions to our top-10 customer list. On the cost side, we continued to lower both material and labor costs."

"Our balance sheet remains among the strongest in the EMS industry as a result of continued positive cash flow from operations and our successful secondary offering completed in February," added Alder. "We believe our strong balance sheet provides us with the resources and flexibility to invest in technology and to position ourselves to capture market share in the future."

Return on Invested Capital

TTM's return on invested capital (ROIC), based on tax-affected EBITA, was 2.7 percent in the first quarter of 2002, compared with 23.4 percent in the year-ago period. On a trailing 12-month basis, TTM generated an ROIC of 6.7 percent.

In the first quarter, the company received net cash proceeds of $15.3 million from its secondary stock offering and generated cash from operations of $3.9 million. At the quarter's end, TTM had net cash of $10.6 million, compared with net debt of $8.1 million at year-end 2001.

Outlook

"Despite some encouraging improvements we experienced in the first quarter, predicting the timing and nature of a technology and capital spending recovery remains difficult," said Alder. For the second quarter of 2002, TTM anticipates revenues ranging from $22 to $24 million and cash earnings per share between a profit of $0.01 and a loss of $0.01.

"Looking ahead, we remain optimistic about our ability to capture additional market share," concluded Alder. "We also expect to remain one of the most profitable companies in the industry, based on our continued focus on sales and marketing efforts, as well as productivity improvements and cost control measures."

TTM Technologies, Inc. is a leading supplier of time-critical, technologically advanced printed circuit boards to original equipment manufacturers and electronic manufacturing services companies. 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.

Conference Call/Webcast

The company will conduct a conference call to discuss its first quarter performance and outlook, today at 4:30 p.m. Eastern/1:30 p.m. Pacific time. The call will be simulcast, and available for replay until May 6, 2002, on the company's Web site at www.ttmtech.com .

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, that 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, including the recent significant slowdown in the technology sector and related excess capacity, the unpredictability of future revenues and expenses, potential fluctuations in revenues and operating results, and other "Risk Factors" set forth in the company's Form 10-K for 2001.

                            TTM TECHNOLOGIES, INC.

                        Selected Financial Information

                    (In thousands, except per share data)

                                                      First Quarter
                                                                       2001
                                               2002        2001      Adjusted*

    CONSOLIDATED STATEMENTS OF INCOME

       Net sales                              $23,734     $46,001     $46,001
       Cost of goods sold                      21,387      27,705      27,705

       Gross profit                             2,347      18,296      18,296

       Operating expenses:
         Sales and marketing                    1,655       2,464       2,464
         General and administrative               577       2,076       2,076
         Amortization of intangibles              300       1,202         300
            Total operating expenses            2,532       5,742       4,840

       Operating income                          (185)     12,554      13,456

       Interest expense                          (267)       (864)       (864)
       Amortization of debt issuance costs        (10)        (10)        (10)
       Interest income and other, net              53         158         158

       Income before income taxes                (409)     11,838      12,740
       Income tax benefit (provision)             131      (4,276)     (4,601)

       Net income                               $(278)     $7,562      $8,139

       Earnings per common share (EPS):
         Basic                                 $(0.01)      $0.20       $0.22
         Diluted                                (0.01)       0.19        0.21
         Cash (diluted)**                        0.00        0.23        0.22

       Weighted average common shares:
         Basic                                 38,604      37,353      37,353
         Diluted                               38,604      38,922      38,922

       *  Adjusted to show the impact of eliminating  goodwill amortization
          and the related income tax effect as if SFAS No. 142  had  been in
          place during the first quarter of 2001

       ** Fully diluted EPS plus amortization of intangibles


     SELECTED BALANCE SHEET DATA                      04/01/02   12/31/01

      Cash                                            $41,284    $24,490
      Accounts receivable, net                         12,138     11,208
      Inventories                                       3,369      3,126
      Total current assets                             59,603     43,971
      Net PP&E                                         49,480     50,906
      Other assets                                     96,846     98,199
      Total assets                                    205,929    193,076

      Current maturities of long-term debt             $4,781     $4,500
      Other current liabilities                         9,515     10,372
      Long-term liabilities                            25,875     28,125
      Shareholders' equity                            165,758    150,079
      Total liabilities and shareholders' equity      205,929    193,076


     SUPPLEMENTAL DATA
                                                   First Quarter
                                                                   2001
                                            2002       2001      Adjusted*

      EBITDA***                            $2,444    $15,870      $15,870
      EBITA****                              $168    $13,914      $13,914

      Gross margin                            9.9 %     39.8 %       39.8 %
      EBITDA margin                          10.3       34.5         34.5
      Operating margin                       (0.8)      27.3         29.3

      Return on Invested Capital (after tax)  2.7 %     23.4 %       23.4 %

      End Market Breakdown:
                                            First Quarter
                                             2002       2001

        Networking/communications            31.2 %     39.5 %
        High-end computing                   14.4       20.2
        Industrial/Medical                   28.6       25.7
        Computer peripherals                 18.3        9.4
        Handheld                              3.1        3.2
        Other                                 4.4        2.0

      ***  EBITDA (earnings before interest, taxes, depreciation and
           amortization) means earnings before interest expense (including
           amortization of debt issuance costs), income taxes, depreciation
           and amortization.

      **** EBITA (earnings before interest, taxes and amortization) means
           earnings before interest expense (including amortization of debt
           issuance costs), income taxes and amortization.

SOURCE: TTM Technologies, Inc.
CONTACT: Stacey Peterson, Chief Financial Officer of TTM Technologies, Inc., +1-714-241-0303
URL: http://www.ttmtech.com
Copyright (C) 2002 PR Newswire. All rights reserved.