Form: 8-K

Current report filing

April 26, 2006

 

Exhibit 99.1
         
 
  Contact:   Steve Richards
Chief Financial Officer
714/241-0303
TTM TECHNOLOGIES, INC. REPORTS FIRST QUARTER 2006 RESULTS;
STRONG PERFORMANCE CONTINUES, AND OUTLOOK REMAINS POSITIVE
SANTA ANA, CA — April 26, 2006 — TTM Technologies, Inc. (Nasdaq: TTMI), a leading manufacturer of time-critical and technologically advanced printed circuit boards, today reported results for the first quarter of 2006.
First-Quarter Results
First quarter 2006 net sales increased $9.6 million, or 15 percent, to a record $72.7 million from $63.1 million in the fourth quarter of 2005 and increased $13.8 million, or 23 percent, from $58.9 million in the first quarter of 2005. The sequential increase, from the fourth quarter of 2005, resulted primarily from improved demand as well as favorable quick-turn pricing trends.
For the first quarter of 2006, quick-turn business represented 21 percent of net sales, compared to 22 percent for the fourth quarter of 2005 and 21 percent for the first quarter of 2005.
Gross margin increased to 27.8 percent for the first quarter of 2006 from 23.8 percent in the fourth quarter of 2005 and 23.0 percent for the first quarter of 2005. Gross margin benefited from higher prices as well as better absorption of fixed costs due to increased production.
General and administrative expense, including amortization of intangibles, was $3.9 million in the first quarter of 2006, an increase from $3.1 million in the fourth quarter of 2005 and $3.7 million in the year-ago period. The increase was primarily due to incentive compensation and stock-based compensation expense.
As a result of strong revenue growth and higher profitability, TTM posted operating income of $13.0 million for the first quarter of 2006, up from $8.8 million for the fourth quarter of 2005 and $6.8 million for the first quarter of 2005.
Net income for the first quarter of 2006 was $8.8 million, or $0.21 per diluted share, compared with $19.0 million, or $0.46 per diluted share, for the fourth quarter of 2005, and $4.5 million, or $0.11 per diluted share, for the first quarter of 2005. Net income for the fourth quarter of 2005 included a $12.7 million, or $0.31 per diluted share, benefit from a reduction of the deferred income tax asset valuation allowance.
EBITDA (earnings before interest, taxes, depreciation and amortization) increased to $16.7 million for the first quarter of 2006 from $12.5 million for the fourth quarter of 2005 and $9.7 million for the first quarter of 2005.
In the first quarter of 2006, TTM generated cash flow from operations of $9.8 million, enabling it to fund net capital expenditures of $3.3 million while expanding its cash and

 


 

short-term investments to a total of $90.5 million, an increase of $8.1 million from year-end 2005 levels.
“TTM continues to capitalize on strong industry conditions with solid demand across multiple market segments, especially in networking and communications,” said Kent Alder, President and CEO of TTM Technologies. “We significantly increased production at each of our facilities during the first quarter. We’re particularly pleased with TTM’s industry-leading earnings, strong cash flow and margin expansion.”
Outlook
For the second quarter of 2006, TTM is estimating further gains, with revenues in a range of $73 million to $77 million and earnings in a range of $0.20 to $0.24 per diluted share.
Conference Call/Webcast
TTM Technologies, Inc. is a leading supplier of time-critical and technologically advanced printed circuit boards to original equipment manufacturers and electronics 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.
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 3, 2006, on the company’s website, 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, 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.
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TTM TECHNOLOGIES, INC.

Selected Unaudited Financial Information
(In thousands, except per share data)
                         
    First Quarter     Fourth Quarter  
    2006     2005     2005  
CONSOLIDATED STATEMENTS OF OPERATIONS
                       
 
                       
Net sales
  $ 72,688     $ 58,883     $ 63,131  
Cost of goods sold
    52,485       45,345       48,102  
 
                 
 
                       
Gross profit
    20,203       13,538       15,029  
 
                 
 
                       
Operating expenses:
                       
Selling and marketing
    3,359       3,017       3,045  
General and administrative
    3,584       3,404       2,840  
Amortization of definite-lived intangibles
    300       300       301  
 
                 
Total operating expenses
    7,243       6,721       6,186  
 
                 
 
                       
Operating income
    12,960       6,817       8,843  
 
                       
Interest expense
    (42 )     (51 )     (63 )
Amortization of debt issuance costs
    (19 )     (13 )     (20 )
Interest income and other, net
    977       384       733  
 
                 
 
                       
Income before income taxes
    13,876       7,137       9,493  
Income tax benefit (provision)
    (5,065 )     (2,677 )     9,555  
 
                 
 
                       
Net income
  $ 8,811     $ 4,460     $ 19,048  
 
                 
 
                       
Earnings per common share:
                       
Basic
    0.21       0.11       0.46  
Diluted
    0.21       0.11       0.46  
 
                       
Weighted average common shares:
                       
Basic
    41,441       41,078       41,301  
Diluted
    41,978       41,784       41,810  

 


 

SELECTED BALANCE SHEET DATA
                 
    April 3, 2006   December 31, 2005
Cash and short-term investments
  $ 90,453     $ 82,358  
Accounts receivable, net
    42,422       38,631  
Inventories, net
    12,867       12,564  
Total current assets
    151,376       140,415  
Net property, plant and equipment
    52,650       51,798  
Other assets
    77,965       80,930  
Total assets
    281,991       273,143  
 
               
Accounts payable
  $ 12,567     $ 11,310  
Total current liabilities
    27,464       29,191  
Stockholders’ equity
    254,527       243,952  
Total liabilities and stockholders’ equity
    281,991       273,143  
SUPPLEMENTAL DATA
                         
    First Quarter   Fourth Quarter
    2006   2005   2005
EBITDA
  $ 16,678     $ 9,684     $ 12,477  
EBITA
  $ 14,267     $ 7,531     $ 9,906  
 
                       
Gross margin
    27.8 %     23.0 %     23.8 %
EBITDA margin
    22.9       16.4       19.8  
Operating margin
    17.8       11.6       14.0  
End Market Breakdown:
                   
    First Quarter
    2006   2005
Networking/communications
    44.2 %     49.3 %
High-end computing
    23.2       25.9  
Industrial/medical
    18.4       14.3  
Computer peripherals
    6.0       5.0  
Handheld
    2.7       2.4  
Other
    5.5       3.1  
RECONCILIATIONS*
                         
    First Quarter     Fourth Quarter  
    2006     2005     2005  
EBITA/EBITDA reconciliation:
                       
Net income
  $ 8,811     $ 4,460     $ 19,048  
Add back items:
                       
Income taxes
    5,065       2,677       (9,555 )
Interest expense
    42       51       63  
Amortization of debt issuance costs
    19       13       20  
Amortization of intangibles
    330       330       330  
 
                 
EBITA
    14,267       7,531       9,906  
 
                       
Depreciation expense
    2,411       2,153       2,571  
 
                 
EBITDA
  $ 16,678     $ 9,684     $ 12,477  
 
                 
 
*   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.