TTM Technologies, Inc. Reports Fiscal Fourth Quarter and 2019

TTM Technologies, Inc. Reports Fiscal Fourth Quarter and 2019 Results

- Tables Follow -

TTM TECHNOLOGIES, INC.
Selected Unaudited Financial Information
(In thousands, except per share data)


				Fourth Quarter				Third Quarter		Full Year
				2019		2018		2019		2019		2018

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

	Net sales			$	719,253	$	710,955	$	716,817	$	2,689,308	$	2,847,261
	Cost of goods sold			594,704		588,323		612,983		2,287,625		2,390,227

	Gross profit			124,549		122,632		103,834		401,683		457,034

	Operating expenses:
		Selling and marketing		18,843		18,533		18,400		74,011		73,313
		General and administrative		43,535		39,615		38,845		152,096		159,437
		Amortization of definite-lived intangibles		10,206		17,722		10,175		48,474		59,681
		Restructuring charges		2,539		3,962		53		6,981		5,518
			Total operating expenses	75,123		79,832		67,473		281,562		297,949

	Operating income			49,426		42,800		36,361		120,121		159,085

	Interest expense			(20,107)		(22,533)		(20,568)		(83,234)		(78,958)
	Other, net			(2,920)		2,357		8,126		9,297		9,641

	Income before income taxes			26,399		22,624		23,919		46,184		89,768
	Income tax (provision) / benefit			(1,140)		29,858		(8,049)		(4,883)		83,816

	Net income			$	25,259	$	52,482	$	15,870	$	41,301	$	173,584

	Earnings per share:
		Basic		$	0.24	$	0.51	$	0.15	$	0.39	$	1.68
		Diluted		$	0.21	$	0.42	$	0.14	$	0.39	$	1.38

	Weighted-average shares used in computing per share amounts:
		Basic		105,502		103,683		105,492		105,195		103,355
		Diluted		133,073		131,533		132,412		106,332		134,036


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

	Net income			$	25,259	$	52,482	$	15,870			$	173,584
		Add back items: interest expense, net of tax		2,825		3,030		2,836				11,906
	Adjusted net income			$	28,084	$	55,512	$	18,706			$	185,490
	Weighted-average shares outstanding			105,502		103,683		105,492				103,355
	Dilutive effect of convertible debt			25,938		25,939		25,938				25,939
	Dilutive effect of warrants			-		-		-				3,065
	Dilutive effect of performance-based stock units, restricted stock units & stock options			1,633		1,911		982				1,677
	Diluted shares			133,073		131,533		132,412				134,036
	Earnings per share:
		Basic		$	0.24	$	0.51	$	0.15			$	1.68
		Diluted		$	0.21	$	0.42	$	0.14			$	1.38


SELECTED BALANCE SHEET DATA
				December 30, 2019		December 31, 2018
	Cash and cash equivalents, including restricted cash			$	400,154	$	256,360
	Accounts and notes receivable, net			503,664		523,165
	Contract assets			288,235		287,741
	Inventories			122,019		109,377
	Total current assets			1,342,684		1,206,914
	Property, plant and equipment, net			1,022,929		1,052,024
	Operating lease right of use asset			24,156		-
	Other non-current assets			1,171,164		1,198,565
	Total assets			3,560,933		3,457,503

	Short-term debt, including current portion of long-term debt			$	249,975	$	30,000
	Accounts payable			483,566		431,288
	Total current liabilities			946,666		673,214
	Debt, net of discount			1,225,962		1,462,425
	Total long-term liabilities			1,335,230		1,557,202
	Total equity			1,279,037		1,227,087
	Total liabilities and equity			3,560,933		3,457,503

SUPPLEMENTAL DATA
				Fourth Quarter				Third Quarter		Full Year
				2019		2018		2019		2019		2018
	Gross margin			17.3%		17.2%		14.5%		14.9%		16.1%
	Operating margin			6.9%		6.0%		5.1%		4.5%		5.6%

	End Market Breakdown:
				Fourth Quarter				Third Quarter
				2019		2018*		2019

		Aerospace/Defense		26%		23%		24%
		Automotive		14%		16%		17%
		Cellular Phone		16%		14%		19%
		Computing/Storage/Peripherals		14%		13%		12%
		Medical/Industrial/Instrumentation		13%		14%		13%
		Networking/Communications		15%		18%		13%
		Other		2%		2%		2%
		* Amended for Anaren integration

	Stock-based Compensation:
				Fourth Quarter				Third Quarter
				2019		2018		2019
		Amount included in:
			Cost of goods sold	$	942	$	766	$	941
			Selling and marketing	518		525		593
			General and administrative	3,166		4,442		3,128
			Total stock-based compensation expense	$	4,626	$	5,733	$	4,662


	Operating Segment Data:
				Fourth Quarter				Third Quarter
		Net sales:		2019		2018		2019
		PCB		$	671,928	$	653,482	$	649,104
		E-M Solutions		47,325		57,473		67,713
			Total net sales	$	719,253	$	710,955	$	716,817

		Operating segment income:
		PCB		$	93,447	$	87,201	$	73,230
		E-M Solutions		1,841		3,364		3,236
		Corporate		(34,373)		(28,863)		(28,750)
			Total operating segment income	60,915		61,702		47,716
		Amortization of definite-lived intangibles		(11,489)		(18,902)		(11,355)
			Total operating income	49,426		42,800		36,361
		Total other expense		(23,027)		(20,176)		(12,442)
		Income before income taxes		$	26,399	$	22,624	$	23,919

RECONCILIATIONS ¹
				Fourth Quarter				Third Quarter		Full Year
				2019		2018		2019		2019		2018
	Non-GAAP gross profit reconciliation ² :
		GAAP gross profit		$	124,549	$	122,632	$	103,834	$	401,683	$	457,034
		Add back item:
			Inventory markup	-		-		-		-		4,900
			Amortization of definite-lived intangibles	1,283		1,180		1,180		4,822		3,345
			Stock-based compensation	942		766		941		3,158		2,898
		Non-GAAP gross profit		$	126,774	$	124,578	$	105,955	$	409,663	$	468,177
		Non-GAAP gross margin		17.6%		17.5%		14.8%		15.2%		16.4%

	Non-GAAP operating income reconciliation ³ :
		GAAP operating income		$	49,426	$	42,800	$	36,361	$	120,121	$	159,085
		Add back items:
			Amortization of definite-lived intangibles	11,489		18,902		11,355		53,296		63,026
			Stock-based compensation	4,626		5,733		4,662		16,816		20,681
			(Gain) on sale of assets	(66)		-		-		(66)		-
			Inventory markup	-		-		-		-		4,900
			Restructuring, acquisition-related, and other charges	6,856		6,104		1,573		13,883		18,797
		Non-GAAP operating income		$	72,331	$	73,539	$	53,951	$	204,050	$	266,489
		Non-GAAP operating margin		10.1%		10.3%		7.5%		7.6%		9.4%

	Non-GAAP net income and EPS reconciliation ⁴ :
		GAAP net income		$	25,259	$	52,482	$	15,870	$	41,301	$	173,584
		Add back items:
			Amortization of definite-lived intangibles	11,489		18,902		11,355		53,296		63,026
			Stock-based compensation	4,626		5,733		4,662		16,816		20,681
			Non-cash interest expense	3,501		4,384		3,452		14,288		14,783
			(Gain) on sale of assets	(186)		-		(251)		(3,743)		-
			Inventory markup	-		-		-		-		4,900
			Restructuring, acquisition-related, and other charges	6,856		6,104		1,573		13,883		19,339
			Income taxes ⁵	(7,623)		(32,614)		2,237		(15,325)		(105,916)
		Non-GAAP net income		$	43,922	$	54,991	$	38,898	$	120,516	$	190,397
		Non-GAAP earnings per diluted share		$	0.41	$	0.52	$	0.37	$	1.13	$	1.76

	Non-GAAP diluted number of shares ⁶ :
		Diluted shares		133,073		131,533		132,412		106,332		134,036
		Dilutive effect of convertible debt		(25,938)		(25,939)		(25,938)		-		(25,939)
		Non-GAAP diluted number of shares		107,135		105,594		106,474		106,332		108,097

	Adjusted EBITDA reconciliation ⁷ :
		GAAP net income		$	25,259	$	52,482	$	15,870	$	41,301	$	173,584
		Add back items:
			Income tax provision (benefit)	1,140		(29,858)		8,049		4,883		(83,816)
			Interest expense	20,107		22,533		20,568		83,234		78,958
			Amortization of definite-lived intangibles	11,489		18,902		11,355		53,296		63,026
			Depreciation expense	42,018		41,543		41,719		166,574		162,708
			Stock-based compensation	4,626		5,733		4,662		16,816		20,681
			(Gain) on sale of assets	(186)		-		(251)		(3,743)		-
			Inventory markup	-		-		-		-		4,900
			Restructuring, acquisition-related, and other charges	6,856		6,104		1,573		13,883		18,797
		Adjusted EBITDA		$	111,309	$	117,439	$	103,545	$	376,244	$	438,838
		Adjusted EBITDA margin		15.5%		16.5%		14.4%		14.0%		15.4%

	Free cash flow reconciliation:
		Operating cash flow		130,148		151,768		58,742		311,937		273,138
		Capital expenditures, net		(46,982)		(33,671)		(25,803)		(135,972)		(149,796)
		Free cash flow		$	83,166	$	118,097	$	32,939	$	175,965	$	123,342

	¹ 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.

	² Non-GAAP gross profit and gross margin measures exclude amortization of intangibles, stock-based compensation expense and inventory markup.

	³ Non-GAAP operating income and operating margin measures exclude amortization of intangibles, stock-based compensation expense, gain on sale of assets, inventory markup, acquisition-related costs, restructuring and other charges.

	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 debt (before consideration of capitalized interest), gain on sale of assets, inventory markup, 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.

	⁵ Income tax adjustments reflect the difference between income taxes based on a non-GAAP tax rate and a forecasted annual GAAP tax rate.

	⁶ Non-GAAP diluted number of shares used in computing non-GAAP earnings per share excludes the dilutive effect of convertible debt.

	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, inventory markup, 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.

« Previous Page 1 | 2 | 3 Next Page »