Form: 8-K

Current report filing

July 29, 2020

Exhibit 99.1

 

TTM Technologies, Inc., Q2’20                                       

                                 

  

Contact:

Sameer Desai,

Senior Director, Corporate

Development & Investor Relations

Sameer.desai@ttmtech.com

714-327-3050

 

TTM Technologies, Inc. Reports Fiscal Second Quarter 2020 Results

Santa Ana, CA – July 29, 2020 – TTM Technologies, Inc. (NASDAQ:TTMI), a leading global printed circuit board (“PCB”) and radio frequency (“RF”) components manufacturer, today reported results for the second quarter of fiscal 2020, which ended on June 29, 2020.

On April 19th, TTM completed the previously announced sale of its Mobility business unit. The operating results and related assets and liabilities of the Mobility business under US GAAP are presented as discontinued operations for all periods. To facilitate the comparison of TTM’s results to previously issued guidance, non-GAAP financial information is also provided below which includes approximately three weeks of results for the Mobility business unit as well as results from the previously announced closure of the two E-MS plants. Please refer to the earnings schedule for additional details on exited businesses and continuing operations.

Second Quarter 2020 Highlights

 

  •  

GAAP net sales were $570.3 million

 

  •  

Non-GAAP net sales were $601.1 million

 

  •  

GAAP net income of $192.8 million, or $1.79 per diluted share, inclusive of a net gain on the sale of the Mobility business unit of $183.1 million or $1.70 per diluted share

 

  •  

Non-GAAP net income was $33.3 million, or $0.31 per diluted share, inclusive of $0.01 of foreign exchange loss

 

  •  

Cash flow from operations of $119.0 million

 

  •  

Today repaid $400 million of Term Loan B from cash received from Mobility Business Unit divestiture

Second Quarter 2020 GAAP Financial Results

Net sales from continuing operations for the second quarter of 2020 were $570.3 million, compared to $526.9 million in the second quarter of 2019 and $497.6 million in the first quarter of 2020.

GAAP operating income from continuing operations for the second quarter of 2020 was $23.0 million, compared to $29.0 million in the second quarter of 2019 and $16.2 million in the first quarter of 2020.

GAAP net income for the second quarter of 2020 was $192.8 million, or $1.79 per diluted share and includes an estimated net gain of $183.1 million from the sale of the Mobility business. This compares to net income of $3.4 million, or $0.03 per diluted share in the second quarter of 2019, and net loss of $1.2 million, or ($0.01) per diluted share, in the first quarter of 2020.

Second Quarter 2020 Non-GAAP Financial Results

Net sales for the second quarter of 2020 were $601.1 million, compared to $633.0 million in the second quarter of 2019 and $610.8 million in the first quarter of 2020.

On a non-GAAP basis, net income for the second quarter of 2020 was $33.3 million, or $0.31 per diluted share. This compares to non-GAAP net income of $21.3 million, or $0.20 per diluted share, for the second quarter of 2019 and $19.6 million, or $0.18 per diluted share, in the first quarter of 2020.

Adjusted EBITDA for the second quarter of 2020 was $80.3 million, or 13.4 percent of net sales, compared to adjusted EBITDA of $82.9 million, or 13.1 percent of net sales, for the second quarter of 2019 and $82.1 million, or 13.4 percent of net sales, for the first quarter of 2020.


 

TTM Technologies, Inc., Q2’20                                       

                                 

  

Contact:

Sameer Desai,

Senior Director, Corporate

Development & Investor Relations

Sameer.desai@ttmtech.com

714-327-3050

 

“In the second quarter, TTM demonstrated excellent operational execution and overcame COVID-19 related challenges to deliver revenue and earnings above the previously guided range. All of our manufacturing facilities continue to remain operational and I want to recognize all of our employees for their tremendous efforts in support of our customers during these challenging times,” said Tom Edman, CEO of TTM. “The diversified mix of end markets that we serve enabled TTM to grow revenues and outperform earnings expectations despite weakness in the automotive and commercial aerospace end markets. Finally, TTM has shown financial discipline, bringing our net debt to EBITDA ratio to 2.1, following the receipt of proceeds from the sale of the Mobility Business Unit and subsequent repayment of our Term loan.”

Business Outlook

Looking ahead, we believe that we will continue to experience COVID-19 related impacts on our end markets as well as inefficiencies with our own production. Taking this into consideration, TTM estimates that revenue for the third quarter of 2020 will be in the range of $470 million to $510 million, and non-GAAP net income will be in the range of $0.16 to $0.22 per diluted share. This guidance no longer includes the Mobility Business Unit but continues to include the E-MS business unit while that business winds down.

Live Webcast/Conference Call

TTM will host a conference call and webcast to discuss second quarter 2020 results and the third quarter 2020 outlook on Wednesday, July 29, 2020, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time). The conference call will include forward-looking statements.

Telephone access is available by dialing domestic 800-367-2403 or international 334-777-6978 (ID 9715005). The conference call also will be webcast on TTM’s website at www.ttm.com.

To Access a Replay of the Webcast

The replay of the webcast will remain accessible for one week following the live event on TTM’s website at www.ttm.com.

About TTM

TTM Technologies, Inc. is a leading global printed circuit board manufacturer, focusing on quick-turn and volume production of technologically advanced PCBs and backplane assemblies as well as a global designer and manufacturer of high-frequency radio frequency (RF) and microwave components and assemblies. TTM stands for time-to-market, representing how TTM’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.ttm.com.

Forward-Looking Statements

This release contains forward-looking statements that relate to future events or performance. TTM cautions you that such statements are simply predictions and actual events or results may differ materially. These statements reflect TTM’s current expectations, and TTM 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 TTM statements will not be realized. Further, these statements involve risks and uncertainties, many of which are beyond TTM’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 impact of COVID-19, general market and economic conditions, including interest rates, currency exchange rates and consumer spending, demand for TTM’s products, market pressures on prices of TTM’s products, warranty claims, changes in product mix, contemplated


 

TTM Technologies, Inc., Q2’20                                       

                                 

  

Contact:

Sameer Desai,

Senior Director, Corporate

Development & Investor Relations

Sameer.desai@ttmtech.com

714-327-3050

 

significant capital expenditures and related financing requirements, TTM’s dependence upon a small number of customers and other factors set forth in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC.

About Our Non-GAAP Financial Measures

This release includes information about TTM’s adjusted EBITDA, non-GAAP net income and non-GAAP earnings per share, all of which are non-GAAP financial measures. TTM presents non-GAAP financial information to enable investors to see TTM through the eyes of management and to provide better insight into TTM’s ongoing financial performance.

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 to similar non-GAAP financial measures used by other companies. TTM 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.

With respect to the Company’s outlook for non-GAAP net income per diluted share, we are unable to predict with reasonable certainty or without unreasonable effort certain items that may affect a comparable measure calculated and presented in accordance with GAAP. Our expected non-GAAP net income per diluted share excludes primarily the future impact of restructuring actions, impairment charges, unusual gains and losses, and tax adjustments. These reconciling items are highly variable and difficult to predict due to various factors outside of management’s control and could have a material impact on our future period net income per diluted share calculated and presented in accordance with GAAP. Accordingly, a reconciliation of non-GAAP net income per diluted share to a comparable measure calculated and presented in accordance with GAAP is not available without unreasonable effort and has not been provided.

- Tables Follow -


TTM TECHNOLOGIES, INC.

Selected Unaudited Financial Information

(In thousands, except per share data)

 

     Second Quarter     First Quarter     First Two Quarters  
     2020     2019*     2020     2020     2019*  

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

          

Net sales

   $ 570,298     $ 526,877     $ 497,646     $ 1,067,944     $ 1,063,322  

Cost of goods sold

     469,868       434,029       416,304       886,172       871,648  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     100,430       92,848       81,342       181,772       191,674  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

          

Selling and marketing

     15,969       16,898       16,169       32,138       34,458  

General and administrative

     33,309       29,137       34,339       67,648       58,987  

Research and development

     5,181       4,496       4,762       9,943       9,212  

Amortization of definite-lived intangibles

     9,561       10,593       9,562       19,123       26,745  

Restructuring charges

     13,414       2,732       328       13,742       3,164  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     77,434       63,856       65,160       142,594       132,566  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     22,996       28,992       16,182       39,178       59,108  

Interest expense

     (18,572     (20,553     (19,781     (38,353     (41,688

Other, net

     455       3,007       2,502       2,957       2,650  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (Loss) from continuing operations before income taxes

     4,879       11,446       (1,097     3,782       20,070  

Income tax benefit (provision)

     4,467       1,047       (2,123     2,344       (1,339
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) from continuing operations

     9,346       12,493       (3,220     6,126       18,731  

Income (loss) from discontinued operations, net of income taxes

     183,464       (9,069     2,046       185,510       (18,559
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 192,810     $ 3,424     $ (1,174   $ 191,636     $ 172  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

* Reclassified Research and development expenses as a separate line item from General and administrative expenses

          

Earnings (loss) per share:

          

Basic earnings (loss) per share from continuing operations

   $ 0.09     $ 0.12     $ (0.03   $ 0.06     $ 0.18  

Basic earnings (loss) per share from discontinued operations

     1.72       (0.09     0.02       1.75       (0.18
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings (loss) per share

   $ 1.81     $ 0.03     $ (0.01   $ 1.81     $ 0.00  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings (loss) per share from continuing operations

   $ 0.09     $ 0.12     $ (0.03   $ 0.06     $ 0.18  

Diluted earnings (loss) per share from discontinued operations

     1.70       (0.09     0.02       1.72       (0.18
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings (loss) per share

   $ 1.79     $ 0.03     $ (0.01   $ 1.78     $ 0.00  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted-average shares used in computing per share amounts:

          

Basic

     106,295       105,470       105,686       105,990       104,893  

Diluted

     107,485       132,045       105,686       107,431       105,860  

Reconciliation of the denominator used to calculate basic earnings per share and diluted earnings per share:

          

Net income

     9,346       12,493         6,126       18,731  

Add back items: interest expense, net of tax

     —         2,780         —         —    
  

 

 

   

 

 

     

 

 

   

 

 

 

Adjusted net income

     9,346       15,273         6,126       18,731  

Weighted-average shares outstanding

     106,295       105,470         105,990       104,893  

Dilutive effect of convertible debt

     —         25,938         —         —    

Dilutive effect of warrants

     —         —           —         —    

Dilutive effect of performance-based stock units, restricted stock units & stock options

     1,190       637         1,441       967  
  

 

 

   

 

 

     

 

 

   

 

 

 

Diluted shares

     107,485       132,045         107,431       105,860  
  

 

 

   

 

 

     

 

 

   

 

 

 

Earnings per share:

          

Basic earnings per share from continuing operations

   $ 0.09     $ 0.12       $ 0.06     $ 0.18  

Basic earnings (loss) per share from discontinued operations

     1.72       (0.09       1.75       (0.18
  

 

 

   

 

 

     

 

 

   

 

 

 

Basic earnings per share

   $ 1.81     $ 0.03       $ 1.81     $ 0.00  
  

 

 

   

 

 

     

 

 

   

 

 

 

Diluted earnings per share from continuing operations

   $ 0.09     $ 0.12       $ 0.06     $ 0.18  

Diluted earnings (loss) per share from discontinued operations

     1.70       (0.09       1.72       (0.18
  

 

 

   

 

 

     

 

 

   

 

 

 

Diluted earnings per share

   $ 1.79     $ 0.03       $ 1.78     $ 0.00  
  

 

 

   

 

 

     

 

 

   

 

 

 
SELECTED BALANCE SHEET DATA           
     June 29,
2020
    December 30,
2019
                   

Cash and cash equivalents, including restricted cash

   $ 694,668     $ 379,818        

Accounts and notes receivable, net

     414,329       503,598        

Contract assets

     287,281       254,600        

Inventories

     122,847       113,753        

Current assets held for sale

     —         67,572        

Total current assets

     1,871,912       1,342,684        

Property, plant and equipment, net

     660,866       678,201        

Operating lease right of use asset

     21,993       22,173        

Non-current assets held for sale

     —         425,597        

Other non-current assets

     1,039,900       1,092,278        

Total assets

     3,594,671       3,560,933        

Short-term debt, including current portion of long-term debt

   $ 649,975     $ 249,975        

Accounts payable

     351,819       329,866        

Current liabilities held for sale

     —         185,391        

Total current liabilities

     1,197,457       946,666        

Debt, net of discount

     832,834       1,225,962        

Non-current liabilities held for sale

     —         1,530        

Total long-term liabilities

     951,649       1,335,230        

Total equity

     1,445,565       1,279,037        

Total liabilities and equity

     3,594,671       3,560,933        


SUPPLEMENTAL DATA

          
     Second Quarter     First Quarter     First Two Quarters  
     2020     2019     2020     2020     2019*  

Gross margin

     17.6     17.6     16.3     17.0     18.0

Operating margin

     4.0     5.5     3.3     3.7     5.6

End Market Breakdown, including Mobility:

          
     Second Quarter     First Quarter              
     2020     2019     2020              

Aerospace/Defense

     31     28     30    

Automotive

     12     16     12    

Cellular Phone

     3     6     11    

Computing/Storage/Peripherals

     13     15     14    

Medical/Industrial/Instrumentation

     20     15     16    

Networking/Communications

     19     17     14    

Other

     2     3     3    

 

TTM Consolidated

 

    Mobility Business Unit

 

End Markets

  1Q 19     2Q 19     3Q 19     4Q 19     FY2019     1Q 20     2Q 20          

End Markets

  1Q 19     2Q 19     3Q 19     4Q 19     FY2019     1Q 20     2Q 20  

Aerospace/Defense

    27     28     24     26     26     30     31    

Aerospace/Defense

    0     0     0     0     0     0     0

Automotive

    17     16     17     14     16     12     12    

Automotive

    5     6     3     2     4     3     4

Cellular Phones

    7     6     19     16     13     11     3    

Cellular Phones

    48     41     73     65     60     56     54

Computing/Storage/Periph

    13     15     12     14     13     14     13    

Computing/Storage/Periph

    28     36     14     19     22     22     25

Medical/Industrial/Inst

    15     15     13     13     14     16     20    

Medical/Industrial/Inst

    7     5     2     3     4     3     4

Networking/
Communications

    18     17     13     15     15     14     19    

Networking/
Communications

    5     5     4     6     5     6     5

Other

    3     3     2     2     3     3     2    

Other

    7     7     4     5     5     10     8

SZ + SH-EMS

 

    TTM, excluding Mobility, SZ & SH E-MS

 

End Markets

  1Q 19     2Q 19     3Q 19     4Q 19     FY2019     1Q 20     2Q 20          

End Markets

  1Q 19     2Q 19     3Q 19     4Q 19     FY2019     1Q 20     2Q 20  

Aerospace/Defense

    0     1     0     0     0     0     0    

Aerospace/Defense

    33     36     36     37     35     38     33

Automotive

    56     58     74     59     63     49     54    

Automotive

    17     15     15     15     15     13     11

Cellular Phones

    0     0     0     0     0     0     0    

Cellular Phones

    0     -1     1     0     0     1     0

Computing/Storage/Periph

    0     0     0     0     0     0     0    

Computing/Storage/Periph

    12     12     12     13     12     12     13

Medical/Industrial/Inst

    22     23     11     19     18     23     14    

Medical/Industrial/Inst

    16     17     18     17     17     18     21

Networking/
Communications

    21     18     16     22     19     29     35    

Networking/
Communications

    20     19     16     17     18     16     19

Other

    1     0     -1     0     0     -1     -3    

Other

    2     2     2     1     3     2     3


Stock-based Compensation, including Mobility:

      
     Second Quarter     First Quarter  
     2020     2019     2020  

Amount included in:

      

Cost of goods sold

   $ 620     $ 569     $ 850  

Selling and marketing

     291       383       451  

General and administrative

     1,690       2,611       3,477  

Research & Development

     46       39       57  
  

 

 

   

 

 

   

 

 

 

Total stock-based compensation expense

   $ 2,647     $ 3,602     $ 4,835  
  

 

 

   

 

 

   

 

 

 

Operating Segment Data:

      
     Second Quarter     First Quarter  

Net sales:

     2020       2019       2020  

PCB

   $ 520,067     $ 466,960     $ 467,430  

E-M Solutions

     50,231       59,917       30,216  
  

 

 

   

 

 

   

 

 

 

Total net sales

   $ 570,298       526,877       497,646  
  

 

 

   

 

 

   

 

 

 

Operating segment income:

      

PCB

   $ 80,056     $ 62,463     $ 61,626  

E-M Solutions

     (15,577     863       (4,329

Corporate

     (30,538     (22,561     (30,170
  

 

 

   

 

 

   

 

 

 

Total operating segment income

     33,941       40,765       27,127  

Amortization of definite-lived intangibles

     (10,945     (11,773     (10,945
  

 

 

   

 

 

   

 

 

 

Total operating income

     22,996       28,992       16,182  

Total other expense

     (18,117     (17,546     (17,279
  

 

 

   

 

 

   

 

 

 

Income (Loss) from continuing operations before income taxes

   $ 4,879     $ 11,446     $ (1,097
  

 

 

   

 

 

   

 

 

 


RECONCILIATIONS1

 

     GAAP
December 30, 2019
     Mobility balances
December 30, 20192
    Combined
December 30, 2019
 

Cash and cash equivalents, including restricted cash

   $ 379,818      $ 20,336     $ 400,154  

Accounts and notes receivable, net

     503,598        66       503,664  

Contract assets

     254,600        33,635       288,235  

Inventories

     113,753        8,266       122,019  

Current assets held for sale

     67,572        (67,572     —    

Total current assets

     1,342,684        —         1,342,684  

Property, plant and equipment, net

     678,201        344,728       1,022,929  

Operating lease right of use asset

     22,173        1,983       24,156  

Non-current assets held for sale

     425,597        (425,597     —    

Other non-current assets

     1,092,278        78,886       1,171,164  

Total assets

     3,560,933        —         3,560,933  
       

Short-term debt, including current portion of long-term debt

   $ 249,975      $ —       $ 249,975  

Accounts payable

     329,866        153,700       483,566  

Current liabilities held for sale

     185,391        (185,391     —    

Total current liabilities

     946,666        —         946,666  

Debt, net of discount

     1,225,962        —         1,225,962  

Non-current liabilities held for sale

     1,530        (1,530     —    

Total long-term liabilities

     1,335,230        —         1,335,230  

Total equity

     1,279,037        —         1,279,037  

Total liabilities and equity

     3,560,933        —         3,560,933  

 

     Second Quarter     First Quarter     First Two Quarters  
     2020     2019     2020     2020     2019*  

Non-GAAP revenue reconciliation3:

          

GAAP revenue

   $ 570,298     $ 526,877     $ 497,646     $ 1,067,944     $ 1,063,322  

Revenue from discontinued operations

     30,777       106,161       113,174       143,951       189,916  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP revenue

   $ 601,075     $ 633,038     $ 610,820     $ 1,211,895     $ 1,253,238  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP gross profit reconciliation4:

          

GAAP gross profit

   $ 100,430     $ 92,848     $ 81,342     $ 181,772     $ 191,674  

Gross profit from discontinued operations

     2,402       (8,233     4,749       7,151       (18,374

Add back item:

          

Amortization of definite-lived intangibles

     1,384       1,180       1,383       2,767       2,359  

Accelerated Depreciation

     2,397       —         —         2,397       —    

Stock-based compensation

     620       569       850       1,470       1,275  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP gross profit

   $ 107,233     $ 86,364     $ 88,324     $ 195,557     $ 176,934  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP gross margin

     17.8     13.6     14.5     16.1     14.1

Non-GAAP operating income reconciliation5:

          

GAAP operating income

   $ 22,996     $ 28,992     $ 16,182     $ 39,178     $ 59,108  

Operating income (loss) from discontinued operations

     976       (12,148     1,441       2,417       (24,774

Add back items:

          

Amortization of definite-lived intangibles

     11,079       12,447       11,620       22,699       30,452  

Accelerated Depreciation

     2,754       —         —         2,754       —    

Stock-based compensation

     2,647       3,602       4,835       7,482       7,528  

Restructuring, acquisition-related, and other charges

     14,273       4,351       1,596       15,869       5,454  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP operating income

   $ 54,725     $ 37,244     $ 35,674     $ 90,399     $ 77,768  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP operating margin

     9.1     5.9     5.8     7.5     6.2

Non-GAAP net income and EPS reconciliation6:

          

GAAP net income (loss)

   $ 9,346     $ 12,493       (3,220   $ 6,126     $ 18,731  

Net income (loss) from discontinued operations

     183,464       (9,069     2,046       185,510       (18,559

Add back items:

          

Amortization of definite-lived intangibles

     11,079       12,447       11,620       22,699       30,452  

Accelerated Depreciation

     2,754       —         —         2,754       —    

Gain on sales of the Mobility business unit

     (248,863     —         —         (248,863     —    

Stock-based compensation

     2,647       3,602       4,835       7,482       7,528  

Non-cash interest expense

     3,604       3,467       3,553       7,157       7,335  

(Gain) on sale of assets

     (274     (235     (233     (507     (3,306

Restructuring, acquisition-related, and other charges

     13,969       4,351       1,596       15,565       5,454  

Income taxes7

     55,613       (5,789     (593     55,020       (9,939
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP net income

   $ 33,339     $ 21,267     $ 19,604     $ 52,943     $ 37,696  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP earnings per diluted share

   $ 0.31     $ 0.20     $ 0.18     $ 0.49     $ 0.36  

Non-GAAP diluted number of shares8:

          

Diluted shares

     107,485       132,045       107,378       107,431       105,860  

Dilutive effect of convertible debt

     —         (25,938     —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP diluted number of shares

     107,485       106,107       107,378       107,431       105,860  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA reconciliation9:

          

GAAP net income (loss)

   $ 9,346     $ 12,493     $ (3,220   $ 6,126     $ 18,731  

Net income (loss) from discontinued operations

     183,464       (9,069     2,046     $ 185,510     $ (18,559

Add back items:

          

Income tax provision (benefit)

     61,498       (2,829     2,865       64,363       (4,306

Interest expense

     18,572       20,871       20,004       38,576       42,559  

Amortization of definite-lived intangibles

     11,079       12,447       11,620       22,699       30,452  

Gain on sales of the Mobility business unit

     (248,863     —         —         (248,863     —    

Depreciation expense

     28,871       41,235       42,632       71,503       82,837  

Stock-based compensation

     2,647       3,602       4,835       7,482       7,528  

(Gain) on sale of assets

     (274     (235     (233     (507     (3,306

Restructuring, acquisition-related, and other charges

     13,969       4,351       1,596       15,565       5,454  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 80,309     $ 82,866     $ 82,145     $ 162,454     $ 161,390  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA margin

     13.4     13.1     13.4     13.4     12.9

Free cash flow reconciliation, including Mobility:

          

Operating cash flow

     118,996       86,123       27,913       146,909       123,047  

Capital expenditures, net

     (22,370     (34,741     (32,451     (54,821     (63,187
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Free cash flow

   $ 96,626     $ 51,382     $ (4,538   $ 92,088     $ 59,860  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Select Non-GAAP income statement data

 

TTM Consolidated

   Q1-19A     Q2-19A     Q3-19A     Q4-19A     FY 2019A     Q1-20A     Q2-20A  

Sales

     620.2       633.0       716.8       719.3       2,689.3       610.8       601.1  

Gross Profit

     90.6       86.4       106.0       126.8       409.7       88.3       107.2  

Gross Margin

     14.6     13.6     14.8     17.6     15.2     14.5     17.8

Op Income

     40.5       37.2       54.0       72.4       204.1       35.7       54.7  

Operating Margin

     6.5     5.9     7.5     10.1     7.6     5.8     9.1

EBITDA

     78.5       82.9       103.5       111.3       376.2       82.1       80.3  

EBITDA %

     12.7     13.1     14.4     15.5     14.0     13.4     13.4

Mobility

   Q1-19A     Q2-19A     Q3-19A     Q4-19A     FY 2019A     Q1-20A     Q2-20A  

Sales

     83.8       106.1       182.6       183.5       556.0       113.2       30.8  

Gross Profit

     (10.1     (8.2     18.6       24.3       24.5       4.7       2.4  

Gross Margin

     -12.1     -7.8     10.2     13.2     4.4     4.2     7.8

Op Income

     (11.9     (10.3     15.9       21.0       14.7       2.1       1.1  

Operating Margin

     -14.2     -9.7     8.7     11.4     2.6     1.9     3.6

EBITDA

     6.0       9.2       36.9       38.5       90.6       21.9       3.8  

EBITDA %

     7.2     8.7     20.2     21.0     16.3     19.3     12.3

SZ + SH-EMS

   Q1-19A     Q2-19A     Q3-19A     Q4-19A     FY 2019A     Q1-20A     Q2-20A  

Sales

     36.0       40.9       54.5       29.8       161.2       14.2       21.4  

Gross Profit

     3.0       3.4       5.2       2.3       13.9       (2.4     (0.3

Gross Margin

     8.3     8.3     9.5     7.7     8.6     -16.7     -1.4

Op Income

     2.0       1.2       4.3       2.0       9.5       (3.8     (0.8

Operating Margin

     5.6     2.9     7.9     6.7     5.9     -26.8     -3.8

EBITDA

     2.5       3.1       7.1       2.0       14.7       (3.6     0.1  

EBITDA %

     6.9     7.6     13.0     6.7     9.1     -25.4     0.4

TTM Proforma Excluding Mobility, SZ & SH-EMS

   Q1-19A     Q2-19A     Q3-19A     Q4-19A     FY 2019A     Q1-20A     Q2-20A  

Sales

     500.4       486.0       479.7       506.0       1,972.1       483.4       548.9  

Gross Profit

     97.7       91.2       82.2       100.1       371.2       86.0       105.6  

Gross Margin

     19.5     18.8     17.1     19.8     18.8     17.8     19.2

Op Income

     52.2       46.2       33.8       49.4       179.8       37.7       54.4  

OM

     10.4     9.5     7.0     9.8     9.1     7.8     9.9

EBITDA

     70.0       70.6       59.5       70.5       270.5       63.5       76.4  

EBITDA %

     14.0     14.5     12.4     13.9     13.7     13.1     13.9

 

1

This information provides a reconciliation of non-GAAP balance sheet data to the financial information in our consolidated condensed balance sheet and non-GAAP revenue, non-GAAP gross profit, non-GAAP operating income, non-GAAP net income, non-GAAP EPS, and adjusted EBITDA to the financial information in our consolidated condensed statements of operations.

 

2

Excludes the estimated gain on sale of Mobility.

 

3

Non-GAAP revenue includes revenue from discontinued operations.

 

4

Non-GAAP gross profit and gross margin measures include discontinued operations and exclude amortization of intangibles, accelerated depreciation due to the closure of two EM-Solutions plants, and stock-based compensation expense.

 

5

Non-GAAP operating income and operating margin measures include discontinued operations and exclude amortization of intangibles, accelerated depreciation due to the closure of two EM-Solutions plants, stock-based compensation expense, gain on sale of assets, acquisition-related costs, restructuring and other charges.

 

6

This information provides non-GAAP net income and non-GAAP EPS, which are non-GAAP financial measures. Management believes that both measures—which include discontinued operations and add back amortization of intangibles, accelerated depreciation due to the closure of two EM-Solutions plants, stock-based compensation expense, non-cash interest expense on debt (before consideration of capitalized interest), gain on sale of assets, acquisition-related costs, restructuring and other charges as well as the associated tax impact of these charges and discrete tax items—provide additional useful information to investors regarding the Company’s ongoing financial condition and results of operations.

 

7

Income tax adjustments reflect the difference between income taxes based on a non-GAAP tax rate and a forecasted annual GAAP tax rate.

 

8

Non-GAAP diluted number of shares used in computing non-GAAP earnings per share excludes the dilutive effect of convertible debt.

 

9

Adjusted EBITDA is defined as earnings, including discontinued operations, before interest expense, income taxes, depreciation, amortization of intangibles, stock-based compensation expense, gain on sale of assets, acquisition-related costs, restructuring and other charges. 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 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.