PRESS RELEASE
Published on November 4, 2009
EXHIBIT 99.1
TTM Technologies, Inc. Reports 2009 Third Quarter Results
SANTA ANA, Calif., Nov. 4, 2009 (GLOBE NEWSWIRE) -- TTM Technologies, Inc. (Nasdaq:TTMI), North America's largest printed circuit board (PCB) manufacturer, today reported results for the third quarter of 2009, ended September 28, 2009.
Third Quarter 2009 Financial Results - GAAP
Third quarter net sales of $139.1 million decreased $5.4 million, or 3.7 percent, from second quarter net sales of $144.5 million. Net loss for the third quarter was $4.9 million, or $0.11 per basic share, compared to second quarter net income of $5.9 million, or $0.14 per diluted share. Excluding non-recurring charges, net income for the third quarter was $5.5 million, or $0.13 per diluted share.
During the third quarter, TTM recorded non-recurring charges totaling $17.1 million, or $0.24 per diluted share, primarily related to the closure of the Company's Hayward, California and Los Angeles, California facilities announced on September 1, 2009 as well as further impairment of its Dallas, Oregon building.
"We are encouraged by the improvement in demand we are experiencing in our PCB business," said Kent Alder, President and CEO of TTM. "For the first time in five quarters, PCB sales increased due to growth with our commercial customers."
Third quarter gross margin of 17.4 percent declined from second quarter gross margin of 18.7 percent. Excluding $2.6 million of inventory write-down costs related to the facility closures, gross margin was 19.3 percent.
Operating loss for the third quarter was $5.4 million compared to operating income of $12.2 million for the second quarter. Excluding non-recurring charges, operating income for the third quarter was $11.7 million.
"TTM continues to perform solidly in all key financial metrics," Alder said. "With the restructuring of our North American footprint, we have positioned the company to better serve customers, improve operating efficiencies and take advantage of improving market conditions."
Third Quarter 2009 Financial Results - Non-GAAP
Non-GAAP results for the third quarter exclude amortization of intangibles, stock-based compensation expense, non-cash interest expense, asset impairment and restructuring charges, inventory write-down related to facility closures and other costs and the income tax effects related to these expenses.
Third quarter non-GAAP net income was $7.8 million, or $0.18 per diluted share. This compares to second quarter non-GAAP net income of $8.7 million, or $0.20 per diluted share.
Excluding asset impairment charges, adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the third quarter was $10.7 million, or 7.7 percent of net sales, compared with second quarter EBITDA of $18.3 million, or 12.6 percent of net sales.
A reconciliation of the Company's non-GAAP financial measures is provided after the GAAP financial statements accompanying this press release.
Third Quarter Segment Information
TTM Technologies reports two operating segments: PCB Manufacturing and Backplane Assembly.
For the PCB Manufacturing segment, third quarter net sales (before inter-company sales) were $123.2 million, compared with $122.6 million in the second quarter. Third quarter operating segment loss (before amortization of intangibles) was $1.9 million due to non-recurring charges of $14.0 million. Excluding these charges, third quarter operating income (before amortization of intangibles) for the PCB Manufacturing segment was $12.1 million compared with operating segment income of $10.7 million in the second quarter.
For the Backplane Assembly segment, third quarter net sales (before inter-company sales) were $24.0 million, compared with $29.1 million in the second quarter. Third quarter operating segment loss (before amortization of intangibles) was $2.6 million due to non-recurring charges of $3.1 million. Excluding these charges, third quarter operating income (before amortization of intangibles) for the Backplane Assembly segment was $0.5 million compared with second quarter operating segment income (before amortization of intangibles) of $2.3 million.
Balance Sheet
Cash and cash equivalents and short-term investments at the end of the third quarter totaled $200.7 million, an increase of $11.3 million from $189.4 million at the end of the second quarter.
Fourth Quarter Fiscal Year 2009 Forecast
For the fourth quarter of 2009, TTM estimates revenue in a range of $140 million to $148 million and GAAP earnings in a range from $0.11 to $0.16 per diluted share.
TTM estimates non-GAAP earnings in a range from $0.18 to $0.23 per diluted share.
To Access the Live Webcast/Conference Call
The company will host a conference call to discuss the third quarter results and the fourth quarter 2009 outlook on November 4, 2009, at 4:30 p.m. Eastern Standard Time (1:30 p.m. Pacific Standard Time).
To listen to the live webcast, log on to the TTM Technologies website at http://www.ttmtech.com. To access the live conference call, dial 408-629-9819 or 1-877-941-8632.
To Access a Replay of the Webcast
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 Nov. 10, 2009. You may access the telephone replay by dialing 303-590-3030 or 800-406-7325 and entering confirmation code 4177386#.
About Our Non-GAAP Financial Measures
This release includes information about the Company's non-GAAP adjusted net income and non-GAAP adjusted net income per share, which are non-GAAP financial measures. Management believes that both measures -- which exclude amortization of intangibles, stock-based compensation expense, non-cash interest expense on our convertible debt, asset impairment and restructuring charges, inventory write-down related to facility closures and other costs as well as the associated tax impact of these charges -- provide additional useful information to investors regarding the Company's ongoing financial condition and results of operations. In addition, the Company's internal reporting, including information provided to the Company's Audit Committee and Board of Directors, contains non-GAAP measures.
A material limitation associated with the use of the above non-GAAP financial measures is that they have no standardized measurement prescribed by GAAP and may not be comparable with similar non-GAAP financial measures used by other companies. The Company compensates for these limitations by providing full disclosure of each non-GAAP financial measure and reconciliation to the most directly comparable GAAP financial measure. However, the non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
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 impact of the current economic crisis, the company's dependence upon a small number of customers, 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.
The TTM Technologies logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5691
TTM TECHNOLOGIES, INC.
Selected Unaudited Financial Information
(In thousands, except per share data)
------------------ -------- ------------------
Second First Three
Third Quarter Quarter Fiscal Quarters
------------------ -------- ------------------
2009 2008 2009 2009 2008
(1) (1),(2)
-------- -------- -------- -------- --------
CONSOLIDATED
STATEMENTS OF
OPERATIONS
Net sales $139,075 $169,019 $144,480 $432,552 $516,065
Cost of goods sold 114,868 136,878 117,421 357,017 409,596
-------- -------- -------- -------- --------
Gross profit 24,207 32,141 27,059 75,535 106,469
-------- -------- -------- -------- --------
Operating expenses:
Selling and
marketing 6,546 7,552 6,313 20,037 23,016
General and
administrative 9,403 8,138 7,661 25,460 25,315
Amortization of
definite-lived
intangibles 860 951 860 2,580 2,848
Restructuring
charges 2,501 -- 48 5,009 --
Impairment of
long-lived assets 10,293 -- -- 10,636 --
Metal reclamation -- -- -- -- (3,700)
-------- -------- -------- -------- --------
Total operating
expenses 29,603 16,641 14,882 63,722 47,479
-------- -------- -------- -------- --------
Operating income
(loss) (5,396) 15,500 12,177 11,813 58,990
Interest expense (2,919) (2,628) (2,762) (8,396) (8,288)
Interest income 196 702 61 356 1,147
Other, net 57 (384) 147 96 (1,388)
-------- -------- -------- -------- --------
Income (loss) before
income taxes (8,062) 13,190 9,623 3,869 50,461
Income tax
(provision) benefit 3,177 (4,397) (3,675) (1,379) (18,184)
-------- -------- -------- -------- --------
Net income (loss) $ (4,885) $ 8,793 $ 5,948 $ 2,490 $ 32,277
======== ======== ======== ======== ========
Earnings (loss) per
common share:
Basic $ (0.11) $ 0.21 $ 0.14 $ 0.06 $ 0.76
Diluted $ (0.11) $ 0.20 $ 0.14 $ 0.06 $ 0.75
Weighted average
common shares:
Basic 43,142 42,805 43,117 43,048 42,637
Diluted 43,142 43,182 43,431 43,458 42,999
SELECTED BALANCE SHEET DATA
------------------
Sept. 28, Dec. 31,
2009 2008(1)
-------- --------
Cash and cash equivalents $199,318 $148,465
Short-term investments 1,419 3,657
Accounts receivable, net 95,897 115,232
Inventories 61,722 71,011
Total current assets 382,092 353,130
Property, plant and equipment, net 89,353 114,931
Other non-current assets 71,440 72,179
Total assets 542,885 540,240
Accounts payable 37,392 48,750
Total current liabilities 62,968 72,768
Convertible senior notes, net 138,601 134,914
Total long-term liabilities 143,085 137,436
Stockholders' equity 336,832 330,036
Total liabilities and stockholders' equity 542,885 540,240
------------------
SUPPLEMENTAL DATA
------------------ -------- ------------------
Second First Three
Third Quarter Quarter Fiscal Quarters
------------------ -------- ------------------
2009 2008 2009 2009 2008
(1) (1),(2)
-------- -------- -------- -------- --------
EBITDA $ 399 $ 22,147 $ 18,250 $ 29,434 $ 77,588
EBITA $ (4,253) $ 16,799 $ 13,285 $ 14,943 $ 61,685
Gross margin 17.4% 19.0% 18.7% 17.5% 20.6%
EBITDA margin 0.3 13.1 12.6 6.8 15.0
Operating margin (3.9) 9.2 8.4 2.7 11.4
End Market Breakdown:
------------------ --------
Second
Third Quarter Quarter
------------------ --------
2009 2008 2009
-------- -------- --------
Networking/
Communications 35% 39% 36%
Aerospace/Defense 44 39 45
Computing/Storage/
Peripherals 12 11 10
Medical/Industrial/
Instrumentation/
Other 9 11 9
Stock-based Compensation:
------------------ --------
Second
Third Quarter Quarter
------------------ --------
2009 2008 2009
-------- -------- --------
Amount included in:
Cost of goods
sold $ 413 $ 388 $ 431
Selling and
marketing 133 116 135
General and
administrative 980 888 999
-------- -------- --------
Total stock-based
compensation
expense $ 1,526 $ 1,392 $ 1,565
======== ======== ========
Operating Segment Data:
------------------ --------
Second
Third Quarter Quarter
------------------ --------
Net sales: 2009 2008(1) 2009
-------- -------- --------
PCB Manufacturing $123,171 $148,003 $122,617
Backplane Assembly 23,950 29,254 29,117
-------- -------- --------
Total sales 147,121 177,257 151,734
Inter-company sales (8,046) (8,238) (7,254)
-------- -------- --------
Total net sales $139,075 $169,019 $144,480
-------- -------- --------
Operating segment
income (loss):
PCB Manufacturing $ (1,897) $ 14,307 $ 10,716
Backplane Assembly (2,639) 2,144 2,321
-------- -------- --------
Total op segment
income (loss) (4,536) 16,451 13,037
Amortization of
intangibles (860) (951) (860)
-------- -------- --------
Total op income
(loss) (5,396) 15,500 12,177
Total other expense (2,666) (2,310) (2,554)
-------- -------- --------
Income (loss) before
income taxes $ (8,062) $ 13,190 $ 9,623
======== ======== ========
RECONCILIATIONS(3)
------------------ -------- ------------------
Second First Three
Third Quarter Quarter Fiscal Quarters
------------------ -------- ------------------
2009 2008(1) 2009 2009 2008(1)
-------- -------- -------- -------- --------
EBITA/EBITDA
reconciliation:
Net income (loss) $ (4,885) $ 8,793 $ 5,948 $ 2,490 $ 32,277
Add back items:
Income tax
provision
(benefit) (3,177) 4,397 3,675 1,379 18,184
Interest expense 2,919 2,628 2,762 8,396 8,288
Amortization of
intangibles 890 981 900 2,678 2,936
-------- -------- -------- -------- --------
EBITA (4,253) 16,799 13,285 14,943 61,685
Depreciation
expense 4,652 5,348 4,965 14,491 15,903
-------- -------- -------- -------- --------
EBITDA $ 399 $ 22,147 $ 18,250 $ 29,434 $ 77,588
======== ======== ======== ======== ========
Add back:
Impairment of
long-lived assets 10,293 -- -- 10,636 --
-------- -------- -------- -------- --------
Adjusted EBITDA $ 10,692 $ 22,147 $ 18,250 $ 40,070 $ 77,588
======== ======== ======== ======== ========
Non-GAAP EPS
reconciliation(4):
GAAP net income
(loss) $ (4,885) $ 8,793 $ 5,948 $ 2,490 $ 32,277
Add back items:
Amortization of
definite-lived
intangibles 890 981 900 2,678 2,936
Stock-based
compensation 1,526 1,392 1,565 4,698 3,861
Non-cash
convertible debt
interest expense 1,381 1,270 1,353 4,059 1,910
Impairment of
long-lived assets 10,293 -- -- 10,636 --
Restructuring
charges 2,501 -- 48 5,009 --
Inventory
write-down
related to
facility closures 2,637 -- 176 3,350 --
Other(5) 1,669 -- 379 2,101 --
Income tax effects (8,235) (1,214) (1,688) (11,595) (3,138)
-------- -------- -------- -------- --------
Non-GAAP net
income $ 7,777 $ 11,222 $ 8,681 $ 23,426 $ 37,846
Non-GAAP diluted
earnings per
common share $ 0.18 $ 0.26 $ 0.20 $ 0.54 $ 0.88
(1) On January 1, 2009, the Company adopted new authoritative
guidance for convertible debt instruments that may be settled in
cash upon conversion (including partial cash settlement) by
separately accounting for the liability and equity components in
a manner that will reflect the entity's nonconvertible debt
borrowing rate when interest cost is recognized in subsequent
periods. The Company has retrospectively applied this method of
accounting back to the issuance date of convertible debt, which
for the Company was May 2008.
(2) Certain reclassifications of prior year amounts have been made to
conform to the current year presentation. Beginning in the second
quarter of 2009, the Company reports gains and losses from the
sale or disposal of property, plant and equipment as a component
of general and administrative expenses in the consolidated
condensed statements of operations. Prior to the second quarter
2009, the gains and losses from the sale or disposal of property,
plant and equipment were included as a component of cost of
goods sold.
(3) This information provides a reconciliation of EBITA/EBITDA/
Adjusted EBITDA and non-GAAP EPS to the financial information in
our consolidated statements of operations.
(4) This information provides non-GAAP adjusted net income and
non-GAAP adjusted EPS, which are non-GAAP financial measures.
Management believes that both measures -- which exclude
amortization of intangibles, stock-based compensation expense,
non-cash interest expense on our convertible debt (before
consideration of capitalized interest), asset impairment and
restructuring charges, inventory write-down related to facility
closures and other costs as well as the associated tax impact
of these charges -- provide additional useful information to
investors regarding the Company's ongoing financial condition and
results of operations.
(5) Costs related to evaluating strategic opportunities and
miscellaneous facility closure costs.
"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 / Adjusted EBITDA to enhance the understanding of our operating
results. EBITDA / EBITA / Adjusted EBITDA is a key measure we use to
evaluate our operations. In addition, we provide our EBITDA / EBITA /
Adjusted EBITDA because we believe that investors and securities
analysts will find EBITDA / EBITA / Adjusted EBITDA 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 / Adjusted EBITDA 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.
CONTACT: TTM Technologies, Inc.
Steve Richards, Chief Financial Officer
(714) 241-0303
investor@ttmtech.com