Form: 8-K

Current report filing

August 5, 2010

EXHIBIT 99.1

TTM Technologies, Inc. Reports 2010 Second Quarter Results

SANTA ANA, Calif., Aug. 5, 2010 (GLOBE NEWSWIRE) -- TTM Technologies, Inc. (Nasdaq:TTMI), a major global printed circuit board (PCB) manufacturer, today reported results for the second quarter of 2010, ended June 28, 2010.

Second Quarter Highlights

  • In the second quarter, we reported record revenue of $310 million, which exceeded the $300 million midpoint of our guidance range.
  • GAAP earnings were $0.06 per diluted share, and non-GAAP earnings were $0.26 per diluted share in the second quarter. The combination with Meadville Holdings Ltd. was accretive to non-GAAP earnings per share this quarter.
  • The integration with Meadville is on track with our expectations.

Second Quarter 2010 Financial Results - GAAP

Second quarter net sales of $310.2 million increased $172.0 million, or 124 percent, from first quarter net sales of $138.2 million. The increase in net sales was primarily due to the combination with Meadville.

Second quarter operating income of $17.4 million increased from first quarter operating income of $9.9 million. We recorded charges of $14.6 million in the second quarter and $2.8 million in the first quarter related to previously announced plant closures, impairment of long-lived assets, transaction costs and inventory adjustments. Net income attributable to stockholders for the second quarter was $4.9 million, or $0.06 per diluted share, compared to net income in the first quarter of $4.5 million, or $0.10 per diluted share.

"We are very pleased with the business performance across the board and excited about the major contribution from our new Asia Pacific operations in the second quarter," said Kent Alder, President and CEO of TTM. "Our integration with Meadville is on track, and further good news is that the Meadville business combination was accretive to non-GAAP earnings in the second quarter, which was earlier than originally expected."

"Our facilities are busy with solid backlogs and high levels of capacity utilization," Alder said. "The added capacity and diversity of the Asia Pacific operations fits extremely well with our growth strategy as a global company."

Second Quarter 2010 Financial Results - Non-GAAP

Non-GAAP results for the second quarter add back amortization of intangibles, stock-based compensation expense, non-cash interest expense, asset impairment and restructuring charges, inventory adjustments, costs related to the Meadville transaction and miscellaneous closing costs as well as the income tax effects related to these expenses.

Second quarter 2010 non-GAAP net income attributable to stockholders was $19.9 million, or $0.26 per diluted share. This compares to first quarter 2010 non-GAAP net income of $8.6 million, or $0.19 per diluted share.

Adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization), which adds back the controlling portion of depreciation and other expenses as well as asset impairment charges, for the second quarter was $32.6 million, or 10.5 percent of net sales, compared to first quarter adjusted EBITDA of $15.1 million, or 10.9 percent of net sales.

Second Quarter 2010 Segment Information

TTM Technologies reports operating segments for North America and Asia Pacific. The North America segment includes our U.S. operations as well as our Shanghai backplane assembly operation, since that business is managed in conjunction with our U.S. based printed circuit board operations. Our Asia Pacific segment includes our PCB manufacturing facilities in Hong Kong and China.

For the North America segment, second quarter 2010 sales (before inter-segment sales) were $138.9 million, compared with $138.2 million in the first quarter. Second quarter operating segment income (before amortization of intangibles) was $6.2 million, compared to operating segment income of $10.7 million in the first quarter. Excluding the charges related to plant closures, impairment of long-lived assets, and the transaction costs, second quarter operating income (before amortization of intangibles) would have been $14.1 million, compared to operating segment income of $13.4 million in the first quarter.

For the Asia Pacific segment, second quarter 2010 sales (before inter-segment sales and based on the completion of the combination on April 8, 2010) were $173.1 million. Second quarter operating segment income (before amortization of intangibles) was $15.8 million. Excluding the inventory fair value adjustment of $6.7 million related to the business combination, second quarter operating income (before amortization of intangibles) would have been $22.4 million.

Balance Sheet

Cash and cash equivalents, restricted cash and short-term investments at the end of the second quarter totaled $213.2 million, a decrease of $9.7 million from $222.9 million at the end of the first quarter. Cash flow from operations was $13.4 million in the second quarter, up from $6.3 million in the first quarter.

The Company currently is finalizing the valuation of the assets acquired and the liabilities assumed in the business combination with Meadville. Accordingly, the preliminary estimated fair values reflected in our second quarter results are subject to adjustment as additional information is obtained.

Third Quarter 2010 Forecast

For the third quarter of 2010, TTM estimates revenue will be in the range of $341 million to $357 million, GAAP earnings attributable to stockholders in a range from $0.20 to $0.27 per diluted share and non-GAAP earnings attributable to stockholders in a range from $0.26 to $0.33 per diluted share. TTM issued 36.3 million shares as part of the Meadville purchase price. As a result, diluted share count for the third quarter will be approximately 80.5 million shares.

To Access the Live Webcast/Conference Call

The company will host a conference call and webcast to discuss the second quarter results, the third quarter 2010 outlook and our recent credit agreement amendment on August 5, 2010, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time).

To listen to the live webcast, log on to the TTM Technologies website at www.ttmtech.com. To access the live conference call, dial 1-877-941-1468 or 1-480-629-9676.

To Access a Replay of the Webcast

The call will be available for replay until August 12, 2010, on TTM Technologies' website at www.ttmtech.com.

A telephone replay also will be available beginning two hours after the conclusion of the conference call.  You may access the telephone replay by dialing 1-303-590-3030 or 1-800-406-7325 and entering confirmation code 4339641.

About Our Non-GAAP Financial Measures

This release includes information about the Company's non-GAAP net income and non-GAAP earnings per share, which are non-GAAP financial measures. Management believes that both measures -- which add back amortization of intangibles, stock-based compensation expense, non-cash interest expense on our debt, asset impairment and restructuring charges, inventory adjustments, costs related to the Meadville Holdings transaction and miscellaneous closing 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.

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 a major global 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 Quarter First Quarter First Two Fiscal Quarters
  2010 2009 2010 2010 2009
           
CONSOLIDATED STATEMENTS OF OPERATIONS          
           
Net sales  $ 310,248  $ 144,480  $ 138,219  $ 448,467  $ 293,477
Cost of goods sold  253,154  117,421  111,246  364,400  242,149
           
Gross profit  57,094  27,059  26,973  84,067  51,328
           
Operating expenses:          
Selling and marketing  9,103  6,313  6,727  15,830  13,491
General and administrative  25,349  7,661  9,037  34,386  16,057
Amortization of definite-lived intangibles  4,621  860  791  5,412  1,720
Restructuring charges  399  48  50  449  2,508
Impairment of long-lived assets  266  --   500  766  343
Total operating expenses  39,738  14,882  17,105  56,843  34,119
           
Operating income  17,356  12,177  9,868  27,224  17,209
           
Interest expense  (6,411)  (2,762)  (2,781)  (9,192)  (5,477)
Interest income  135  61  61  196  160
Other, net  46  147  (69)  (23)  39
           
Income before income taxes  11,126  9,623  7,079  18,205  11,931
Income tax provision  (4,386)  (3,675)  (2,594)  (6,980)  (4,556)
           
Net income  6,740  5,948  4,485  11,225  7,375
           
Net income attributable to noncontrolling interest  (1,811)  --   --   (1,811)  -- 
Net income attributable to TTM Technologies, Inc.  $ 4,929  $ 5,948  $ 4,485  $ 9,414  $ 7,375
           
Earnings per share attributable to stockholders:          
Basic  $ 0.06  $ 0.14  $ 0.10  $ 0.16  $ 0.17
Diluted  $ 0.06  $ 0.14  $ 0.10  $ 0.16  $ 0.17
           
Weighted average common shares:          
Basic  76,050  43,117  43,310  59,954  43,000
Diluted  76,485  43,431  43,979  60,504  43,326
           
SELECTED BALANCE SHEET DATA           
           
  June 28,
2010
December 31, 2009      
Cash and cash equivalents  $ 213,186  $ 94,347      
Restricted cash  --   120,000      
Short-term investments  --   1,351      
Accounts receivable, net  256,446  89,519      
Inventories  127,810  60,153      
Total current assets  628,614  382,559      
Property, plant and equipment, net  671,425  88,577      
Other non-current assets  374,033  71,922      
Total assets  1,674,072  543,058      
           
Current portion long-term debt  89,804  --       
Accounts payable  213,250  37,867      
Total current liabilities  355,616  59,447      
Long-term liabilities  490,278  139,882      
Total long-term liabilities  561,670  142,694      
Noncontrolling interest  108,360  --       
Total stockholders' equity  756,786  340,917      
Total liabilities and stockholders' equity  1,674,072  543,058      
           
SUPPLEMENTAL DATA          
       
  Second Quarter First Quarter First Two Fiscal Quarters
  2010 2009 2010 2010 2009
Gross margin  18.4%   18.7%   19.5%   18.7%   17.5% 
Adjusted EBITDA margin  10.5  12.6  10.9  10.6  10.0
Operating margin  5.6  8.4  7.1  6.1  5.9
           
End Market Breakdown:          
         
  Second Quarter First Quarter    
  2010 2009 2010    
           
Aerospace/Defense  19%   45%   42%     
Cellular Phones  10  --   --     
Computing/Storage/Peripherals  25  11  13    
Medical/Industrial/Instrumentation  9  7  11    
Networking/Communications  32  36  33    
Other  5  1  1    
           
Stock-based Compensation:          
         
  Second Quarter First Quarter    
  2010 2009 2010    
Amount included in:          
Cost of goods sold  $ 327  $ 431  $ 328    
Selling and marketing  109  135  108    
General and administrative  1,158  999  976    
Total stock-based compensation expense  $ 1,594  $ 1,565  $ 1,412    
           
           
Operating Segment Data:          
         
  Second Quarter First Quarter    
 Net sales:  2010 2009 2010    
 North America   $ 138,925  $ 144,480  $ 138,219    
 Asia Pacific   173,073  --   --     
 Total sales   311,998  144,480  138,219    
 Inter-segment sales   (1,750)  --   --     
 Total net sales   $ 310,248  $ 144,480  $ 138,219    
           
 Operating segment income:           
 North America   $ 6,206  $ 13,037  $ 10,659    
 Asia Pacific   15,771  --   --     
 Total operating segment income   21,977  13,037  10,659    
 Amortization of definite-lived intangibles   (4,621)  (860)  (791)    
 Total operating income   17,356  12,177  9,868    
 Total other expense   (6,230)  (2,554)  (2,789)    
 Income before income taxes   $ 11,126  $ 9,623  $ 7,079    
           
RECONCILIATIONS1          
       
  Second Quarter First Quarter First Two Fiscal Quarters
  2010 2009 2010 2010 2009
Adjusted EBITDA reconciliation2:          
Net income attributable to stockholders  $ 4,929  $ 5,948  $ 4,485  $ 9,414  $ 7,375
Add back items:          
Income tax provision, net3  4,019  3,675  2,594  6,613  4,556
Interest expense3  6,229  2,762  2,781  9,010  5,477
Amortization of definite-lived intangibles  4,650  900  820  5,470  1,788
Depreciation expense, net3  12,501  4,965  3,883  16,384  9,839
Impairment of long-lived assets  266  --   500  766  343
Adjusted EBITDA  $ 32,594  $ 18,250  $ 15,063  $ 47,657  $ 29,378
           
Non-GAAP EPS reconciliation4:          
GAAP net income attributable to stockholders  $ 4,929  $ 5,948  $ 4,485  $ 9,414  $ 7,375
Add back items:          
Amortization of definite-lived intangibles  4,650  900  820  5,470  1,788
Stock-based compensation  1,594  1,565  1,412  3,006  3,172
Non-cash interest expense  1,928  1,353  1,440  3,368  2,678
Impairment of long-lived assets  266  --   500  766  343
Restructuring charges  399  48  50  449  2,508
Inventory write-down related to facility closures  --   176  284  284  713
Inventory fair value adjustment  6,651  --   --   6,651  -- 
Transaction costs  6,986  1  1,798  8,784  1
Miscellaneous closing costs  265  379  137  401  432
Income tax effects  (7,731)  (1,689)  (2,360)  (10,091)  (4,443)
Non-GAAP net income attributable to stockholders  $ 19,937  $ 8,681  $ 8,566  $ 28,502  $ 14,567
           
Non-GAAP earnings per diluted share  $ 0.26  $ 0.20  $ 0.19  $ 0.47  $ 0.34
           
           
1 This information provides a reconciliation of Adjusted EBITDA, non-GAAP net income and non-GAAP EPS to the financial information in our consolidated statements of operations.
           
2 Adjusted EBITDA is defined as net income attributable to stockholders adjusted for controlling portion of interest expense, income taxes, depreciation, amortization and asset impairment. We present Adjusted EBITDA to enhance the understanding of our operating results, and it is a key measure we use to evaluate our operations. In addition, we provide our Adjusted EBITDA because we believe that investors and securities analysts will find 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, Adjusted EBITDA is not defined under generally accepted accounting principles ("GAAP") in the United States of America, and it may not be comparable to similarly titled measures by other companies. 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.
           
3 Excludes noncontrolling interest portion.
           
4 This information provides non-GAAP net income and non-GAAP EPS, which are non-GAAP financial measures. Management believes that both measures --- which add back amortization of intangibles, stock-based compensation expense, non-cash interest expense on our debt (before consideration of capitalized interest), asset impairment and restructuring charges, inventory write-down related to facility closures, inventory fair value adjustment, costs related to the Meadville Holdings transaction and miscellaneous closing 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.
CONTACT: TTM Technologies, Inc.
         Steve Richards, CFO
         714-327-3000