10-Q: Quarterly report pursuant to Section 13 or 15(d)
Published on May 9, 2023
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form
For the quarterly period ended
Or
For the transition period from ____________ to____________
Commission File Number:
TTM TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
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(I.R.S. Employer Identification No.) |
(Address of principal executive offices)
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of May 4, 2023, there were outstanding
TABLE OF CONTENTS
2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
TTM TECHNOLOGIES, INC.
Consolidated Condensed Balance Sheets
As of April 3, 2023 and January 2, 2023
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As of |
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April 3, |
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January 2, |
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2023 |
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2023 |
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(Unaudited) |
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(In thousands, except par value) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Accounts receivable, net |
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Contract assets |
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Inventories |
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Receivable from sale of Shanghai E-MS (SH E-MS) property |
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Prepaid expenses and other current assets |
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Total current assets |
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Property, plant and equipment, net |
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Operating lease right-of-use assets |
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Goodwill |
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Definite-lived intangibles, net |
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Deposits and other non-current assets |
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Total assets |
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$ |
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$ |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current liabilities: |
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Short-term debt, including current portion of long-term debt |
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$ |
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$ |
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Accounts payable |
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Contract liabilities |
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Accrued salaries, wages and benefits |
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Other current liabilities |
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Total current liabilities |
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Long-term debt, net of discount and issuance costs |
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Operating lease liabilities |
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Other long-term liabilities |
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Total long-term liabilities |
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Equity: |
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Common stock, $ |
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Treasury stock – common stock at cost; |
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Additional paid-in capital |
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Retained earnings |
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Accumulated other comprehensive loss |
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Total stockholders’ equity |
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Total liabilities and stockholders' equity |
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$ |
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$ |
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See accompanying notes to consolidated condensed financial statements.
3
TTM TECHNOLOGIES, INC.
Consolidated Condensed Statements of Operations
For the Quarters Ended April 3, 2023 and April 4, 2022
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Quarter Ended |
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April 3, |
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April 4, |
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2023 |
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2022 |
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(Unaudited) |
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(In thousands, except per share data) |
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Net sales |
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$ |
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$ |
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Cost of goods sold |
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Gross profit |
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Operating expenses: |
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Selling and marketing |
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General and administrative |
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Research and development |
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Amortization of definite-lived intangibles |
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Restructuring charges |
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Total operating expenses |
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Operating (loss) income |
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( | ) |
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Other (expense) income: |
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Interest expense |
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Gain on sale of subsidiary |
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Other, net |
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Total other expense, net |
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(Loss) income before income taxes |
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Income tax benefit |
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Net (loss) income |
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$ |
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$ |
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(Loss) earnings per share: |
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Basic (loss) earnings per share |
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$ |
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$ |
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Diluted (loss) earnings per share |
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$ |
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$ |
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See accompanying notes to consolidated condensed financial statements.
4
TTM TECHNOLOGIES, INC.
Consolidated Condensed Statements of Comprehensive (Loss) Income
For the Quarters Ended April 3, 2023 and April 4, 2022
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Quarter Ended |
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April 3, |
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April 4, |
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2023 |
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2022 |
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(Unaudited) |
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(In thousands) |
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Net (loss) income |
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$ |
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$ |
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Other comprehensive income (loss), net of tax: |
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Pension obligation adjustments, net |
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Foreign currency translation adjustments |
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Derecognition of foreign currency translation adjustments |
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Net unrealized (loss) gain on cash flow hedges: |
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Unrealized (loss) gain on effective cash flow hedges during |
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Loss realized in the statement of operations, net |
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Net |
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Other comprehensive (loss) income, net of tax |
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( |
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Comprehensive (loss) income, net of tax |
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$ |
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$ |
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See accompanying notes to consolidated condensed financial statements.
5
TTM TECHNOLOGIES, INC.
Consolidated Condensed Statements of Stockholders’ Equity
For the Quarters Ended April 3, 2023 and April 4, 2022
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Common Stock |
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Treasury Stock |
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Additional |
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Retained |
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Accumulated |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Earnings |
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Loss |
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Equity |
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(Unaudited) |
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(In thousands) |
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Balance, January 2, 2023 |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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Other comprehensive loss |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Issuance of common stock for |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock for |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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Balance, April 3, 2023 |
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$ |
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( | ) |
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$ |
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$ |
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$ |
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$ |
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$ |
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Common Stock |
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Treasury Stock |
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Additional |
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Retained |
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Accumulated |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Earnings |
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(Loss) Income |
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Equity |
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(Unaudited) |
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(In thousands) |
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Balance, January 3, 2022 |
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$ |
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( |
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$ |
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$ |
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$ |
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$ |
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$ |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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Other comprehensive income |
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— |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock for |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock for |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Repurchases of common stock |
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— |
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— |
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( |
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( |
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— |
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— |
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— |
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( |
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Fair value of warrants |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
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Issuance of common stock |
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— |
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— |
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( |
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— |
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— |
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— |
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Stock-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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Balance, April 4, 2022 |
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$ |
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( | ) |
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$ |
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$ |
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$ |
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$ |
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$ |
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See accompanying notes to consolidated condensed financial statements.
6
TTM TECHNOLOGIES, INC.
Consolidated Condensed Statements of Cash Flows
For the Quarters Ended April 3, 2023 and April 4, 2022
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Quarter Ended |
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April 3, 2023 |
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April 4, 2022 |
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(Unaudited) |
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(In thousands) |
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Cash flows from operating activities: |
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Net (loss) income |
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$ |
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$ |
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Adjustments to reconcile net income to net cash provided by operating activities: |
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Depreciation of property, plant and equipment |
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Amortization of definite-lived intangible assets |
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Amortization of debt discount and issuance costs |
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Deferred income taxes |
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Stock-based compensation |
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Gain on sale of subsidiary |
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Other |
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Changes in operating assets and liabilities: |
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Accounts receivable, net |
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Contract assets |
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Inventories |
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Prepaid expenses and other current assets |
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Accounts payable |
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Contract liabilities |
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Accrued salaries, wages and benefits |
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( |
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Other current liabilities |
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Net cash provided by operating activities |
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Cash flows from investing activities: |
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Proceeds from sale of SH E-MS property |
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Purchase of property, plant and equipment and other assets |
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Proceeds from sale of property, plant and equipment and other assets |
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Proceeds from sale of subsidiary, net of cash disposed |
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Net cash provided by (used in) investing activities |
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Cash flows from financing activities: |
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Repayment of long-term debt borrowings |
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( |
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Repurchases of common stock |
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Cash used to settle warrants |
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( |
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Net cash used in financing activities |
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( |
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( |
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Effect of foreign currency exchange rates on cash and cash equivalents |
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( |
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( |
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Net increase (decrease) in cash and cash equivalents |
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( |
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Cash and cash equivalents at beginning of period |
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Cash and cash equivalents at end of period |
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$ |
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$ |
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Supplemental cash flow information: |
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Cash paid, net for interest |
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$ |
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$ |
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Cash paid, net for income taxes |
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Supplemental disclosure of noncash investing and financing activities: |
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Property, plant and equipment recorded in accounts payable |
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$ |
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$ |
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Issuance of common stock for warrant settlement |
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See accompanying notes to consolidated condensed financial statements.
7
TTM TECHNOLOGIES, INC.
Notes to Consolidated Condensed Financial Statements
(Unaudited)
(Dollars and shares in thousands, except per share data)
(1) Nature of Operations and Basis of Presentation
TTM Technologies, Inc. (the Company or TTM) is a leading global manufacturer of technology solutions, including engineered systems, radio frequency (RF) components and RF microwave/microelectronic assemblies, and printed circuit boards (PCB). The Company provides time-to-market and volume production of advanced technology products and offers a one-stop design, engineering, and manufacturing solution to customers. This one-stop design, engineering, and manufacturing solution allows the Company to align technology developments with the diverse needs of the Company’s customers and to enable them to reduce the time required to develop new products and bring them to market.
The Company serves a diversified customer base in various markets throughout the world, including aerospace and defense, data center computing, automotive, medical, industrial and instrumentation related products, as well as networking. The Company’s customers include original equipment manufacturers (OEMs), electronic manufacturing services (EMS) providers, original design manufacturers (ODMs), distributors and government agencies.
The accompanying consolidated condensed financial statements have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) have been condensed or omitted pursuant to such rules and regulations. It is suggested that these consolidated condensed financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s most recent Annual Report on Form 10-K. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s consolidated condensed financial statements and accompanying notes. Due, in part, to the on-going effects of the coronavirus (COVID-19) global pandemic on the Company and the conflict between Russia and Ukraine, the global economy and financial markets have been volatile, and both the pandemic and conflict has contributed to on-going disruptions in global supply chains, labor shortages, high inflation, and a potential recession, and there is a significant amount of uncertainty about the length and severity of the direct and indirect effects of the pandemic and the conflict. The Company has considered information available to it as of the date of issuance of these financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgments, or a revision to the carrying value of its assets or liabilities. The actual results the Company experienced may differ materially and adversely from its estimates. The Company uses a 52/53 week fiscal calendar with the fourth quarter ending on the Monday nearest December 31.
Recently Adopted and Issued Accounting Standards
Recently Adopted Accounting Standards
In September 2022, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2022-04, Liabilities - Supplier Finance Programs (Topic 450-50): Disclosure of Supplier Finance Program Obligations, that requires entities that use supplier finance programs in connection with the purchase of goods and services to disclose the key terms of the programs and information about obligations outstanding at the end of the reporting period, including a rollforward of those obligations. The guidance does not affect the recognition, measurement or financial statement presentation of supplier finance program obligations. The amendments are effective for all entities for fiscal years beginning after December 15, 2022 on a retrospective basis, including interim periods within those fiscal years, except for the requirement to disclose rollforward information, which is effective prospectively for fiscal years beginning after December 15, 2023. The Company adopted ASU 2022-04 as of