TTM Technologies, Inc. Reports Second Quarter 2001 Cash Earnings of $0.09 Per Share
July 19, 2001 - In the second quarter, general economic weakness and a downturn in the electronics industry led to a year-over-year decline in revenue. Net sales declined 33 percent to $30.7 million compared to $46.1 million for the second quarter of 2000. Gross profit declined 48 percent to $7.8 million, as gross margins declined to 25.3 percent in the second quarter of 2001, compared to 32.7 percent for the same period in 2000.
In the second quarter, general economic weakness and a downturn in the electronics industry led to a year-over-year decline in revenue. Net sales declined 33 percent to $30.7 million compared to $46.1 million for the second quarter of 2000. Gross profit declined 48 percent to $7.8 million, as gross margins declined to 25.3 percent in the second quarter of 2001, compared to 32.7 percent for the same period in 2000.
Earnings before interest, taxes, depreciation and amortization (EBITDA) declined 42 percent to $7.1 million for the second quarter of 2001, compared to $12.2 million for the second quarter of 2000.
For the second quarter of 2001, quick-turn business as a percentage of total revenues increased to approximately 45 percent, compared to approximately 32 percent for the second quarter of 2000. During the quarter, the company captured more than 60 new customer accounts.
"During the second quarter, we benefited from proactive cost cutting, including a 26 percent year-to-date reduction in the labor force, reduced working hours, lower material costs, and a significant expansion in our sales force," said Kent Alder, President and CEO of TTM Technologies. "However, the challenging business environment affected all segments of our business, with the greatest impact felt in ramp-to-volume and volume production."
Return on Invested Capital and Liquidity
TTM's return on invested capital (ROIC), based on tax-effected EBITA, was 10.5 percent in the second quarter of 2001, compared with 18.5 percent in the year-ago period. On a trailing 12-month basis, TTM had an ROIC of 24.6 percent.
The company's balance sheet strengthened further during the quarter. Through the first half of the year, TTM reduced its net debt to $13.5 million, down $20.5 million since year-end 2000. As a result, TTM has a net debt-to-capital ratio of 8.4 percent, compared to 19.8 percent at year-end 2000.
For the third quarter of 2001, the company is estimating revenues of $26 to $30 million and cash earnings per share of $0.04 to $0.08. "Despite the pressure on revenues, we continue to actively manage our business to maximize profitability and cash flow," said Alder.
"On a longer-term basis, TTM remains well positioned," concluded Alder. "We serve the most attractive niches of the printed circuit board market, and we continue to believe our focus on time to market provides better growth prospects and higher profitability than the overall industry. In addition, our specialized production facilities enable us to meet customer needs at any stage, from prototype through volume production. As the printed circuit board industry continues to consolidate, our strong financial position, full-service capabilities and technological sophistication will enable us to continue to capture market share."
TTM Technologies, Inc. is a leading supplier of time-critical, technologically advanced printed circuit boards to original equipment manufacturers and electronic manufacturing services companies. TTM stands for time-to-market, representing how the company?s time-critical, one-stop shopping manufacturing services enable customers to shorten the time required to develop new products and bring them to market. TTM trades on the Nasdaq National Market System under the symbol "TTMI".
The company will conduct a conference call to discuss its second-quarter performance and outlook today at 4:30 p.m. Eastern/1:30 p.m. Pacific time. The call will be simulcast, and available for replay until July 26, 2001, on the company?s Web site at www.ttmtech.com.
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, that 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 company's dependence upon a small number of customers, the unpredictability of future revenues and expenses, potential fluctuations in revenues and operating results and the other "Factors That May Affect Future Results" set forth in the company's Form 10-K for 2000.
TTM Technologies, Inc. Earnings Release Schedule For Second Quarter 2001
"Safe Harbor"; Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding TTM Technologies' business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.