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TTM Technologies, Inc. Reports 2010 Second Quarter Results

for immediate release

SANTA ANA, CA - August 5, 2010 - 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 US 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.

- Tables Follow -
Q2 2010 TTM Earnings Schedule

 

 

Company

TTM Technologies
(ticker: TTMI, exchange: NASDAQ)

Release Info

News Release:
08/05/2010

Contact

Steve Richards
Chief Financial Officer
714/241-0303