TTMI 8-K
Ttm Technologies Inc (TTMI)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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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. ☐
| Item 2.02. | Results of Operations and Financial Condition |
On May 4, 2022, TTM Technologies, Inc. (the “Registrant”) issued a press release announcing results for its first quarter of fiscal year 2022, which ended April 4, 2022, and guidance for its second quarter 2022. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
As previously announced, the Registrant will host a conference call on Wednesday, May 4, 2022, at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time to discuss its first quarter 2022 results and the second quarter 2022 outlook. Dial-in information for the call is as follows: Telephone access is available by dialing domestic 888-220-8474 or international 323-794-2588 (ID 5381401). The conference call will also be webcast on the Registrant’s website at www.ttm.com.
As provided in General Instruction B.2 to Form 8-K, the information furnished in Item 2.02 and Exhibit 99.1 hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities under that Section, and shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly provided by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits |
| Exhibit Number |
Description | |
| 99.1 | Press Release dated May 4, 2022 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TTM TECHNOLOGIES, INC. | ||||||
| Date: May 4, 2022 | /s/ Daniel J. Weber | |||||
| By: | Daniel J. Weber | |||||
| Executive Vice President, General Counsel & Secretary | ||||||
Exhibit 99.1
| TTM Technologies, Inc., Q1’22 | Contact: | |
| Sameer Desai, | ||
| Vice President, Corporate | ||
| Development & Investor Relations | ||
| [email protected] | ||
| 714-327-3050 |
TTM Technologies, Inc. Reports Fiscal First Quarter 2022 Results
Santa Ana, CA – May 4, 2022– TTM Technologies, Inc. (NASDAQ:TTMI), a leading global manufacturer of printed circuit boards (“PCB”), radio frequency (“RF”) components and RF microwave/microelectronic assemblies, today reported results for the first quarter fiscal 2022, which ended on April 4, 2022.
First Quarter 2022 Highlights
| • | Net sales were $581.3 million |
| • | GAAP net income of $17.2 million, or $0.17 per diluted share |
| • | Non-GAAP net income was $25.3 million, or $0.24 per diluted share |
| • | Operating cash flow of $36.0 million |
| • | Repurchased 2.4 million shares of common stock for $30.2 million at an average price of $12.74 per share |
| • | Announced investment in a greenfield production facility in Malaysia |
First Quarter 2022 GAAP Financial Results
Net sales for the first quarter of 2022 were $581.3 million, compared to $526.4 million in the first quarter of 2021.
GAAP operating income for the first quarter of 2022 was $25.9 million. This compares to GAAP operating income of $19.8 million in the first quarter of 2021.
GAAP net income for the first quarter of 2022 was $17.2 million, or $0.17 per diluted share, compared to net loss of $3.2 million, or ($0.03) per diluted share in the first quarter of 2021.
First Quarter 2022 Non-GAAP Financial Results
On a non-GAAP basis, net income for the first quarter of 2022 was $25.3 million, or $0.24 per diluted share. This compares to non-GAAP net income of $25.3 million, or $0.23 per diluted share, for the first quarter of 2021.
Adjusted EBITDA in the first quarter of 2022 was $62.0 million compared to adjusted EBITDA of $61.0 million for the first quarter of 2021.
“In the first quarter, TTM achieved revenues at the high end of guidance and non-GAAP earnings above the mid-point of the guided range. This outperformance was driven by strength in our commercial end markets, despite labor and production challenges in North America and inflationary pressures globally,” said Tom Edman, CEO of TTM. “We also took significant steps to advance our strategy of differentiation with the agreement to acquire Telephonics Corporation which provides engineered system level solutions for the Aerospace and Defense end market and enables TTM to move further up the value chain. In addition, we announced the building of a new manufacturing facility in Malaysia which enables TTM to offer our customers a regional alternative for high volume, high layer count PCBs to meet their supply chain resiliency requirements,” continued Mr. Edman.
Business Outlook
TTM estimates that revenue for the second quarter of 2022 will be in the range of $580 million to $620 million, and non-GAAP net income will be in the range of $0.30 to $0.36 per diluted share. This guidance does not include any contribution of the previously announced acquisition of Telephonics as we are awaiting regulatory approvals prior to closing.
| TTM Technologies, Inc., Q1’22 | Contact: Sameer Desai, Vice President, Corporate Development & Investor Relations 714-327-3050 |
Live Webcast/Conference Call
TTM will host a conference call and webcast to discuss first quarter 2022 results and the second quarter 2022 outlook on Wednesday, May 4th, 2022 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 888-220-8474 or international 323-794-2588 (ID 5381401). 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/microelectronics 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
The preliminary financial results included in this press release represent the most current information available to management. The company’s actual results when disclosed in its Form 10-K may differ from these preliminary results as a result of the completion of the company’s financial closing procedures; final adjustments; completion of the review by the company’s independent registered accounting firm; and other developments that may arise between now and the disclosure of the final results. 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 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.
| TTM Technologies, Inc., Q1’22 | Contact: Sameer Desai, Vice President, Corporate Development & Investor Relations 714-327-3050 |
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)
| CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS | ||||||||
| First Quarter | ||||||||
| 2022 | 2021 | |||||||
| Net sales |
$ | 581,260 | $ | 526,432 | ||||
| Cost of goods sold |
490,337 | 444,832 | ||||||
|
|
|
|
|
|||||
| Gross profit |
90,923 | 81,600 | ||||||
|
|
|
|
|
|||||
| Operating expenses: |
||||||||
| Selling and marketing |
18,272 | 16,282 | ||||||
| General and administrative |
32,954 | 31,527 | ||||||
| Research and development |
5,555 | 4,470 | ||||||
| Amortization of definite-lived intangibles |
8,274 | 9,521 | ||||||
|
|
|
|
|
|||||
| Total operating expenses |
65,055 | 61,800 | ||||||
|
|
|
|
|
|||||
| Operating income |
25,868 | 19,800 | ||||||
| Interest expense |
(11,361 | ) | (11,389 | ) | ||||
| Loss on extinguishment of debt |
— | (15,217 | ) | |||||
| Other, net |
1,970 | 2,507 | ||||||
|
|
|
|
|
|||||
| Income (loss) before income taxes |
16,477 | (4,299 | ) | |||||
| Income tax benefit |
769 | 1,107 | ||||||
|
|
|
|
|
|||||
| Net income (loss) |
$ | 17,246 | $ | (3,192 | ) | |||
|
|
|
|
|
|||||
| Earnings (loss) per share: |
||||||||
| Basic |
$ | 0.17 | $ | (0.03 | ) | |||
| Diluted |
0.17 | (0.03 | ) | |||||
| Weighted-average shares used in computing per share amounts: |
||||||||
| Basic |
102,613 | 106,825 | ||||||
| Diluted |
104,304 | 106,825 | ||||||
| Reconciliation of the denominator used to calculate basic earnings per share and diluted earnings per share: |
|
|||||||
| Weighted-average shares outstanding |
102,613 | |||||||
| Dilutive effect of warrants |
6 | |||||||
| Dilutive effect of performance-based stock units, restricted stock units & stock options |
1,685 | |||||||
|
|
|
|||||||
| Diluted shares |
104,304 | |||||||
|
|
|
|||||||
| SELECTED BALANCE SHEET DATA | ||||||||
| April 4, 2022 | January 3, 2022 | |||||||
| Cash and cash equivalents, including restricted cash |
$ | 519,079 | $ | 537,678 | ||||
| Accounts and notes receivable, net |
412,432 | 386,347 | ||||||
| Contract assets |
318,713 | 324,862 | ||||||
| Inventories |
137,343 | 127,612 | ||||||
| Total current assets |
1,434,183 | 1,407,413 | ||||||
| Property, plant and equipment, net |
663,394 | 665,755 | ||||||
| Operating lease right of use asset |
19,503 | 20,802 | ||||||
| Other non-current assets |
927,068 | 931,577 | ||||||
| Total assets |
3,044,148 | 3,025,547 | ||||||
| Accounts payable |
$ | 383,929 | $ | 361,484 | ||||
| Total current liabilities |
586,566 | 558,148 | ||||||
| Debt, net of discount |
928,210 | 927,818 | ||||||
| Total long-term liabilities |
1,009,753 | 1,011,982 | ||||||
| Total equity |
1,447,829 | 1,455,417 | ||||||
| Total liabilities and equity |
3,044,148 | 3,025,547 | ||||||
| SUPPLEMENTAL DATA | ||||||||
| First Quarter | ||||||||
| 2022 | 2021 | |||||||
| Gross margin |
15.6 | % | 15.5 | % | ||||
| Operating margin |
4.5 | % | 3.8 | % | ||||
| End Market Breakdown: | ||||||||
| First Quarter | ||||||||
| 2022 | 2021 | |||||||
| Aerospace/Defense |
30 | % | 35 | % | ||||
| Automotive |
20 | % | 18 | % | ||||
| Data Center Computing |
16 | % | 14 | % | ||||
| Medical/Industrial/Instrumentation |
21 | % | 17 | % | ||||
| Networking/Communications |
13 | % | 15 | % | ||||
| Other |
0 | % | 1 | % | ||||
| Stock-based Compensation: | ||||||||
| First Quarter | ||||||||
| 2022 | 2021 | |||||||
| Amount included in: |
||||||||
| Cost of goods sold |
$ | 1,276 | $ | 1,165 | ||||
| Selling and marketing |
650 | 646 | ||||||
| General and administrative |
2,053 | 2,355 | ||||||
| Research and development |
255 | 43 | ||||||
|
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|
|
|
|||||
| Total stock-based compensation expense |
$ | 4,234 | $ | 4,209 | ||||
|
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|
|
|
|||||
| Operating Segment Data: | ||||||||
| First Quarter | ||||||||
| 2022 | 2021 | |||||||
| Net sales: |
||||||||
| PCB |
$ | 566,070 | $ | 510,486 | ||||
| RF&S Components |
15,190 | 12,690 | ||||||
|
Other1 |
— | 3,256 | ||||||
|
|
|
|
|
|||||
| Total net sales |
$ | 581,260 | $ | 526,432 | ||||
|
|
|
|
|
|||||
| Operating segment income: |
||||||||
| PCB |
$ | 56,540 | $ | 57,232 | ||||
| RF&S Components |
5,750 | 3,862 | ||||||
| Corporate & Other1 |
(26,764 | ) | (30,389 | ) | ||||
|
|
|
|
|
|||||
| Total operating segment income |
35,526 | 30,705 | ||||||
| Amortization of definite-lived intangibles |
(9,658 | ) | (10,905 | ) | ||||
|
|
|
|
|
|||||
| Total operating income |
25,868 | 19,800 | ||||||
| Total other expense |
(9,391 | ) | (24,099 | ) | ||||
|
|
|
|
|
|||||
| Income (loss) before income taxes |
$ | 16,477 | $ | (4,299 | ) | |||
|
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|
|
|
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| RECONCILIATIONS2 | ||||||||
| First Quarter | ||||||||
| 2022 | 2021 | |||||||
| Non-GAAP gross profit reconciliation3: |
||||||||
| GAAP gross profit |
$ | 90,923 | $ | 81,600 | ||||
| Add back item: |
||||||||
| Amortization of definite-lived intangibles |
1,384 | 1,384 | ||||||
| Stock-based compensation |
1,276 | 1,165 | ||||||
| Unrealized gain on commodity hedge |
(1,403 | ) | — | |||||
| Restructuring and other charges |
— | 254 | ||||||
|
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|
|
|
|||||
| Non-GAAP gross profit |
$ | 92,180 | $ | 84,403 | ||||
|
|
|
|
|
|||||
| Non-GAAP gross margin |
15.9 | % | 16.0 | % | ||||
| Non-GAAP operating income reconciliation4: |
||||||||
| GAAP operating income |
$ | 25,868 | $ | 19,800 | ||||
| Add back items: |
||||||||
| Amortization of definite-lived intangibles |
9,658 | 10,905 | ||||||
| Stock-based compensation |
4,234 | 4,209 | ||||||
| Gain on sale of assets |
— | (410 | ) | |||||
| Unrealized gain on commodity hedge |
(1,403 | ) | — | |||||
| Restructuring, acquisition-related and other charges |
1,138 | 3,285 | ||||||
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|
|
|
|||||
| Non-GAAP operating income |
$ | 39,495 | $ | 37,789 | ||||
|
|
|
|
|
|||||
| Non-GAAP operating margin |
6.8 | % | 7.2 | % | ||||
| Non-GAAP net income and EPS reconciliation5: |
||||||||
| GAAP net income (loss) |
$ | 17,246 | $ | (3,192 | ) | |||
| Add back items: |
||||||||
| Amortization of definite-lived intangibles |
9,658 | 10,905 | ||||||
| Stock-based compensation |
4,234 | 4,209 | ||||||
| Non-cash interest expense |
532 | 537 | ||||||
| Gain on sale of assets |
(827 | ) | (980 | ) | ||||
| Change in fair value of warrant liabilities |
(99 | ) | (172 | ) | ||||
| Loss on extinguishment of debt |
— | 15,217 | ||||||
| Unrealized gain on commodity hedge |
(1,403 | ) | — | |||||
| Restructuring, acquisition-related and other charges |
1,138 | 3,285 | ||||||
| Income taxes6 |
(5,226 | ) | (4,551 | ) | ||||
|
|
|
|
|
|||||
| Non-GAAP net income |
$ | 25,253 | $ | 25,258 | ||||
|
|
|
|
|
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| Non-GAAP earnings per diluted share |
$ | 0.24 | $ | 0.23 | ||||
| Non-GAAP diluted number of shares: |
||||||||
| GAAP diluted number of shares |
104,304 | 106,825 | ||||||
| Dilutive effect of performance-based stock units, restricted stock units & stock options |
— | 1,879 | ||||||
|
|
|
|
|
|||||
| Non-GAAP diluted number of shares |
104,304 | 108,704 | ||||||
|
|
|
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|
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| Adjusted EBITDA reconciliation7: |
||||||||
| GAAP net income (loss) |
$ | 17,246 | $ | (3,192 | ) | |||
| Add back items: |
||||||||
| Income tax benefit |
(769 | ) | (1,107 | ) | ||||
| Interest expense |
11,361 | 11,389 | ||||||
| Amortization of definite-lived intangibles |
9,658 | 10,905 | ||||||
| Depreciation expense |
21,500 | 21,476 | ||||||
| Stock-based compensation |
4,234 | 4,209 | ||||||
| Gain on sale of assets |
(827 | ) | (980 | ) | ||||
| Change in fair value of warrant liabilities |
(99 | ) | (172 | ) | ||||
| Loss on extinguishment of debt |
— | 15,217 | ||||||
| Unrealized gain on commodity hedge |
(1,403 | ) | — | |||||
| Restructuring, acquisition-related and other charges |
1,138 | 3,285 | ||||||
|
|
|
|
|
|||||
| Adjusted EBITDA |
$ | 62,039 | $ | 61,030 | ||||
|
|
|
|
|
|||||
| Adjusted EBITDA margin |
10.7 | % | 11.6 | % | ||||
| Free cash flow reconciliation: |
||||||||
| Operating cash flow |
$ | 35,991 | $ | 41,145 | ||||
| Capital expenditures, net |
(23,420 | ) | (20,966 | ) | ||||
|
|
|
|
|
|||||
| Free cash flow |
$ | 12,571 | $ | 20,179 | ||||
|
|
|
|
|
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| 1 | Other represents the Shanghai E-MS and Shenzhen plant results. |
| 2 | This information provides a reconciliation of 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. |
| 3 | Non-GAAP gross profit and gross margin measures exclude amortization of intangibles, stock-based compensation expense, unrealized gain on commodity hedge, restructuring and other charges. |
| 4 | Non-GAAP operating income and operating margin measures exclude amortization of intangibles, stock-based compensation expense, gain on sale of assets, unrealized gain on commodity hedge, restructuring, acquisition-related costs, and other charges. |
| 5 | 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 debt (before consideration of capitalized interest), gain on sale of assets, change in fair value of warrant liabilities, loss on extinguishment of debt, unrealized gain on commodity hedge, restructuring, acquisition-related costs, 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. |
| 6 | Income tax adjustments reflect the difference between income taxes based on a non-GAAP tax rate and a forecasted annual GAAP tax rate. |
| 7 | Adjusted EBITDA is defined as earnings before interest expense, income taxes, depreciation, amortization of intangibles, stock-based compensation expense, gain on sale of assets, change in fair value of warrant liabilities, loss on extinguishment of debt, unrealized gain on commodity hedge, restructuring, acquisition-related costs, 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. |