EXHIBIT 99.1
Published on July 26, 2006
Exhibit 99.1
Contact: | Steve Richards | |||
Chief Financial Officer | ||||
714/241-0303 |
TTM TECHNOLOGIES, INC. REPORTS STRONG SECOND QUARTER 2006 RESULTS
SANTA ANA, CA July 26, 2006 TTM Technologies, Inc. (Nasdaq: TTMI), a leading
manufacturer of time-critical and technologically advanced printed circuit boards, today reported
results for the second quarter of 2006.
Second-Quarter Results
Second quarter 2006 net sales increased $4.0 million, or 5.5 percent, to a record $76.7 million
from $72.7 million in the first quarter of 2006 and increased $19.5 million, or 34.0 percent, from
$57.2 million in the second quarter of 2005. These favorable comparisons resulted from strong
pricing and rising demand.
For the second quarter of 2006, quick-turn business represented 19.5 percent of net sales, compared
to 20.7 percent for the first quarter of 2006 and 21.8 percent for the second quarter of 2005.
Gross margin increased to 30.0 percent for the second quarter of 2006 from 27.8 percent in the
first quarter of 2006 and 19.3 percent for the second 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 $4.0 million in the
second quarter of 2006, an increase of $80,000 over the first quarter of 2006 and $628,000 over the
year-ago period. As a percent of sales, G&A expense declined to 5.2 percent in the second quarter
of 2006, compared to 5.3 percent in the first quarter of 2006 and 5.8 percent in the second quarter
of 2005. The year-over-year increase in G&A expense was due primarily to higher incentive
compensation expense and stock-based compensation expense.
As a result of strong revenue growth and higher profitability, TTM posted operating income of $15.6
million for the second quarter of 2006, compared to $13.0 million for the first quarter of 2006 and
$4.8 million for the second quarter of 2005.
Net income for the second quarter of 2006 was $10.6 million, or $0.25 per diluted share, compared
with $8.8 million, or $0.21 per diluted share, for the first quarter of 2006, and $3.3 million, or
$0.08 per diluted share, for the second quarter of 2005.
EBITDA (earnings before interest, taxes, depreciation and amortization) increased to $19.4 million
for the second quarter of 2006 from $16.7 million for the first quarter of 2006 and $7.9 million
for the second quarter of 2005.
In the second quarter of 2006, TTM generated cash flow from operations of $10.8 million, enabling
it to fund net capital expenditures of $2.3 million, while expanding its cash and short-term
investments to a total of $101.2 million, an increase of $10.7 million during the quarter.
We again posted excellent results in the second quarter of 2006 as we capitalized on solid market
conditions and continued to execute our time and technology strategy. We are proud of the fact
that we consistently increase market share and generate superior profitability in the printed
circuit board marketplace, said Kent Alder, President and CEO of TTM Technologies.
Outlook
For the third quarter of 2006, TTM is estimating revenues in a range of $73 million to $78 million
and earnings in a range of $0.20 to $0.25 per diluted share.
Business indicators for the printed circuit board industry, while somewhat mixed, suggest relative
stability in the third quarter of 2006, concluded Alder. And TTM will continue to expand on its
time and technology leadership.
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 companys 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 second-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 August 3, 2006, on the companys website, www.ttmtech.com.
This release contains forward-looking statements that relate to future events or performance.
These statements reflect the companys 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 companys 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 companys dependence upon the electronics industry, the companys
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 companys most recent SEC filings.
Tables Follow
TTM TECHNOLOGIES, INC.
Selected Unaudited Financial Information
(In thousands, except per share data)
Second Quarter | First Quarter | First Two Fiscal Quarters | ||||||||||||||||||
2006 | 2005 | 2006 | 2006 | 2005 | ||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||||||
Net sales |
$ | 76,683 | $ | 57,216 | $ | 72,688 | $ | 149,371 | $ | 116,099 | ||||||||||
Cost of goods sold |
53,714 | 46,179 | 52,485 | 106,199 | 91,524 | |||||||||||||||
Gross profit |
22,969 | 11,037 | 20,203 | 43,172 | 24,575 | |||||||||||||||
Operating expenses: |
||||||||||||||||||||
Selling and marketing |
3,454 | 2,865 | 3,359 | 6,813 | 5,882 | |||||||||||||||
General and administrative |
3,663 | 3,035 | 3,584 | 7,247 | 6,439 | |||||||||||||||
Amortization of intangibles |
301 | 301 | 300 | 601 | 601 | |||||||||||||||
Total operating expenses |
7,418 | 6,201 | 7,243 | 14,661 | 12,922 | |||||||||||||||
Operating income |
15,551 | 4,836 | 12,960 | 28,511 | 11,653 | |||||||||||||||
Interest expense |
(25 | ) | (49 | ) | (42 | ) | (67 | ) | (100 | ) | ||||||||||
Amortization of debt issuance costs |
(20 | ) | (13 | ) | (19 | ) | (39 | ) | (26 | ) | ||||||||||
Interest income and other, net |
1,118 | 462 | 977 | 2,095 | 846 | |||||||||||||||
Income before income taxes |
16,624 | 5,236 | 13,876 | 30,500 | 12,373 | |||||||||||||||
Income tax provision |
(6,068 | ) | (1,964 | ) | (5,065 | ) | (11,133 | ) | (4,641 | ) | ||||||||||
Net income |
$ | 10,556 | $ | 3,272 | $ | 8,811 | $ | 19,367 | $ | 7,732 | ||||||||||
Earnings per common share: |
||||||||||||||||||||
Basic |
0.25 | 0.08 | 0.21 | 0.47 | 0.19 | |||||||||||||||
Diluted |
0.25 | 0.08 | 0.21 | 0.46 | 0.19 | |||||||||||||||
Weighted average common shares: |
||||||||||||||||||||
Basic |
41,694 | 41,267 | 41,441 | 41,566 | 41,171 | |||||||||||||||
Diluted |
42,512 | 41,772 | 41,978 | 42,242 | 41,778 |
SELECTED BALANCE SHEET DATA
July 3, 2006 | December 31, 2005 | |||||||
Cash and short-term investments |
$ | 101,244 | $ | 82,358 | ||||
Accounts receivable, net |
44,837 | 38,631 | ||||||
Inventories, net |
13,886 | 12,564 | ||||||
Total current assets |
165,100 | 140,415 | ||||||
Net property, plant and equipment |
52,553 | 51,798 | ||||||
Other assets |
79,223 | 80,930 | ||||||
Total assets |
296,876 | 273,143 | ||||||
Accounts payable |
$ | 12,112 | $ | 11,310 | ||||
Total current liabilities |
28,119 | 29,191 | ||||||
Stockholders equity |
268,757 | 243,952 | ||||||
Total liabilities and stockholders equity |
296,876 | 273,143 |
SUPPLEMENTAL DATA
Second Quarter | First Quarter | First Two Fiscal Quarters | ||||||||||||||||||
2006 | 2005 | 2006 | 2006 | 2005 | ||||||||||||||||
EBITDA |
$ | 19,444 | $ | 7,887 | $ | 16,677 | $ | 36,121 | $ | 17,570 | ||||||||||
EBITA |
$ | 16,999 | $ | 5,628 | $ | 14,266 | $ | 31,265 | $ | 13,158 | ||||||||||
Gross margin |
30.0 | % | 19.3 | % | 27.8 | % | 28.9 | % | 21.2 | % | ||||||||||
EBITDA margin |
25.4 | 13.8 | 22.9 | 24.2 | 15.1 | |||||||||||||||
Operating margin |
20.3 | 8.5 | 17.8 | 19.1 | 10.0 |
End Market Breakdown:
Second Quarter | ||||||||
2006 | 2005 | |||||||
Networking/communications |
43.9 | % | 43.5 | % | ||||
High-end computing |
27.3 | 29.6 | ||||||
Industrial/medical |
16.3 | 15.3 | ||||||
Computer peripherals |
6.4 | 5.1 | ||||||
Handheld |
2.1 | 3.1 | ||||||
Other |
4.0 | 3.4 |
RECONCILIATIONS*
Second Quarter | First Quarter | First Two Fiscal Quarters | ||||||||||||||||||
2006 | 2005 | 2006 | 2006 | 2005 | ||||||||||||||||
EBITA/EBITDA reconciliation: |
||||||||||||||||||||
Net income |
$ | 10,556 | $ | 3,272 | $ | 8,811 | $ | 19,367 | $ | 7,732 | ||||||||||
Add back items: |
||||||||||||||||||||
Income taxes |
6,068 | 1,964 | 5,065 | 11,133 | 4,641 | |||||||||||||||
Interest expense |
25 | 49 | 42 | 67 | 100 | |||||||||||||||
Amortization
of debt issuance costs |
20 | 13 | 19 | 39 | 26 | |||||||||||||||
Amortization of intangibles |
330 | 330 | 329 | 659 | 659 | |||||||||||||||
EBITA |
16,999 | 5,628 | 14,266 | 31,265 | 13,158 | |||||||||||||||
Depreciation expense |
2,445 | 2,259 | 2,411 | 4,856 | 4,412 | |||||||||||||||
EBITDA |
$ | 19,444 | $ | 7,887 | $ | 16,677 | $ | 36,121 | $ | 17,570 | ||||||||||
* | 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. |