Edgar Filing: TTM TECHNOLOGIES INC

TTM TECHNOLOGIES, INC.

Date: March 1, 2013

/s/ Steven W. Richards

Steven W. Richards

Chief Financial Officer

Form 8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K/A

(Amendment No. 1)

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported) February 5, 2013

TTM TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in Charter)

DELAWARE

(State or other jurisdiction of incorporation)


0-31285		91-1033443
(Commission File Number)		(IRS Employer Identification Number)

1665 Scenic Ave, Suite 250, Costa Mesa, CA

92626

(Address of Principal Executive Offices) (Zip Code)

(714) 327-3000

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On February 5, 2013, TTM Technologies, Inc. (the “Company”) filed a Current Report on Form 8-K (the “Original Filing”) with the Securities and Exchange Commission furnishing a press release that announced the Company’s financial results for the fourth quarter and year ended December 31, 2012. This Amendment No. 1 on Form 8-K/A is being filed to amend certain information set forth in the Original Filing.

Subsequent to the issuance of the press release and the Original Filing, the Company was notified by a customer of a warranty claim for defective products. The Company estimates a potential liability of approximately $650,000 for this claim. The warranty claim resulted in an approximate $650,000 decrease in the Company’s fourth quarter and full year 2012 net sales reflected in the Original Filing. Net sales are $381.7 million for the quarter ended December 31, 2012 (compared to $382.4 million as previously reported) and $1,348.7 million for the year ended December 31, 2012 (compared to $1,349.3 million as previously reported).

In addition, the Company increased the valuation allowance on the deferred tax assets of one of its China-based subsidiaries by approximately $1.6 million. The increase in the valuation allowance on the deferred tax assets and the tax impact of the warranty claim resulted in a net increase of $1.3 million in the Company’s tax provision for the fourth quarter and year ended December 31, 2012.

The net impact of the above adjustments is a decrease in net income attributable to stockholders for the quarter ended December 31, 2012 to $13.7 million, or $0.17 per diluted share (compared to $15.7 million, or $0.19 per diluted share, as previously reported), and an increase in the net loss attributable to stockholders for the year ended December 31, 2012 to $174.6 million, or $2.13 per share (compared to $172.6 million, or $2.11 per share, as previously reported).

On a non-GAAP basis, the net impact of the above adjustments is a decrease to net income attributable to stockholders for the quarter ended December 31, 2012 to $18.6 million, or $0.23 per diluted share (compared to $21.5 million, or $0.26 per diluted share, as previously reported), and a decrease in net income attributable to stockholders for the year ended December 31, 2012 to $69.1 million, or $0.84 per diluted share (compared to $72.0 million, or $0.87 per diluted share, as previously reported).

Previously reported results for the first three quarters of 2012 are not affected by the adjustments. The financial statements included below in this report reflect the adjustments noted above. The Company’s Form 10-K for the year ended December 31, 2012, filed with the Securities and Exchange Commission on March 1, 2013, reflects this corrected information.

About Our Non-GAAP Financial Measures

This report contains information about the Company’s non-GAAP net income attributable to stockholders and non-GAAP earnings per share attributable to stockholders, 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, asset impairments, restructuring and other charges 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 to 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.

TTM TECHNOLOGIES, INC.

Selected Unaudited Financial Information

(In thousands, except per share data)


	Fourth Quarter						Third Quarter			Full Year
	2012			2011			2012			2012			2011
CONSOLIDATED STATEMENTS OF OPERATIONS
Net sales	$	381,735		$	361,460		$	339,011		$	1,348,668		$	1,428,639
Cost of goods sold		320,221			290,082			286,695			1,123,669			1,127,326

Gross profit		61,514			71,378			52,316			224,999			301,313

Operating expenses:
Selling and marketing		9,592			9,867			8,735			35,957			36,891
General and administrative		28,682			24,178			23,735			98,005			92,682
Amortization of definite-lived intangibles		2,515			4,517			4,104			14,637			17,311
Impairment of goodwill and definite-lived intangibles		—			15,184			200,335			200,335			15,184
Impairment of long-lived assets		—			—			18,082			18,082			48,125

Total operating expenses		40,789			53,746			254,991			367,016			210,193

Operating income (loss)		20,725			17,632			(202,675	)		(142,017	)		91,120
Interest expense		(6,558	)		(6,795	)		(6,429	)		(25,784	)		(26,504	)
Loss on extinguishment of debt		—			—			(5,527	)		(5,527	)		—
Other, net		2,440			2,851			1,117			4,956			8,616

Income (loss) before income taxes		16,607			13,688			(213,514	)		(168,372	)		73,232
Income tax (provision) benefit		(4,926	)		(1,328	)		850			(12,728	)		(26,005	)
Net income (loss)		11,681			12,360			(212,664	)		(181,100	)		47,227
Net loss (income) attributable to noncontrolling interest		2,061			(1,190	)		4,322			6,505			(5,359	)

Net income (loss) attributable to stockholders	$	13,742		$	11,170		$	(208,342	)	$	(174,595	)	$	41,868

Earnings (loss) per share attributable to stockholders:
Basic	$	0.17		$	0.14		$	(2.54	)	$	(2.13	)	$	0.52
Diluted	$	0.17		$	0.14		$	(2.54	)	$	(2.13	)	$	0.51
Weighted average common shares:
Basic		81,932			81,336			81,929			81,800			81,176
Diluted		82,613			81,988			81,929			81,800			81,944

SELECTED BALANCE SHEET DATA


	December 31,
	2012		2011
Cash and cash equivalents	$	285,433	$	196,052
Accounts and notes receivable, net		301,557		316,568
Inventories		146,012		129,430
Total current assets		765,612		671,534
Property, plant and equipment, net		833,678		766,800
Other non-current assets		77,672		310,735

Total assets	$	1,676,962	$	1,749,069

Short-term debt, including current portion long-term debt	$	30,004	$	120,882
Accounts payable		221,265		185,906
Total current liabilities		369,880		437,140
Debt, net of discount		527,541		368,518
Total long-term liabilities		554,252		389,259
Noncontrolling interest		98,883		113,753
Total stockholders’ equity		752,830		922,670

Total liabilities and stockholders’ equity	$	1,676,962	$	1,749,069


SUPPLEMENTAL DATA
	Fourth Quarter						Third Quarter			Full Year
	2012			2011			2012			2012			2011
Gross margin		16.1	%		19.7	%		15.4	%		16.7	%		21.1	%
Adjusted EBITDA margin		13.0			16.6			10.8			13.0			17.5
Operating margin		5.4			4.9			(59.8	)		(10.5	)		6.4

End Market Breakdown:


	Fourth Quarter						Third Quarter
	2012			2011			2012
Aerospace/Defense		13	%		15	%		16	%
Cellular Phone		17			14			15
Computing/Storage/Peripherals		23			20			21
Medical/Industrial/Instrumentation		7			8			8
Networking/Communications		30			33			29
Other		10			10			11


Stock-based Compensation:
	Fourth Quarter				Third Quarter
	2012		2011		2012
Amount included in:
Cost of goods sold	$	265	$	251	$	253
Selling and marketing		124		106		115
General and administrative		2,432		1,786		2,089

Total stock-based compensation expense	$	2,821	$	2,143	$	2,457


Operating segment Data:
	Fourth Quarter						Third Quarter 2012
	2012			2011			Third Quarter 2012
Net sales:
Asia Pacific	$	259,378		$	218,448		$	215,746
North America		123,232			144,079			123,861

Total sales		382,610			362,527			339,607
Inter-segment sales		(875	)		(1,067	)		(596	)

Total net sales	$	381,735		$	361,460		$	339,011

Operating segment income (loss):
Asia Pacific	$	17,644		$	20,094		$	(206,806	)
North America		5,596			2,055			8,235

Total operating segment income (loss)		23,240			22,149			(198,571	)
Amortization of definite-lived intangibles		(2,515	)		(4,517	)		(4,104	)

Total operating income (loss)		20,725			17,632			(202,675	)
Total other expense		(4,118	)		(3,944	)		(10,839	)

Income (loss) before income taxes	$	16,607		$	13,688		$	(213,514	)


RECONCILIATIONS¹

	Fourth Quarter						Third Quarter			Full Year
	2012			2011			2012			2012			2011
Adjusted EBITDA reconciliation²:
Net income (loss)	$	11,681		$	12,360		$	(212,664	)	$	(181,100	)	$	47,227
Add back items:
Income tax provision		4,926			1,328			(850	)		12,728			26,005
Interest expense		6,558			6,795			6,429			25,784			26,504
Amortization of definite-lived intangibles		2,515			4,546			4,104			14,684			17,427
Depreciation expense		23,962			19,946			21,046			84,286			69,698

EBITDA	$	49,642		$	44,975		$	(181,935	)	$	(43,618	)	$	186,861

Add back: Asset impairments		—			15,184			218,417			218,417			63,309

Adjusted EBITDA	$	49,642		$	60,159		$	36,482		$	174,799		$	250,170

GAAP EPS excluding impairments reconciliation³:
GAAP net income (loss) attributable to stockholders	$	13,742		$	11,170		$	(208,342	)	$	(174,595	)	$	41,868
Add back items:
Asset impairments		—			15,184			218,417			218,417			63,309
Income tax effects		—			(4,058	)		(2,574	)		(2,574	)		(4,764	)

GAAP net income, excluding impairments, attributable to stockholders	$	13,742		$	22,296		$	7,501		$	41,248		$	100,413


GAAP earnings per diluted share, excluding impairments, attributable to stockholders	$	0.17		$	0.27		$	0.09		$	0.50		$	1.23
Non-GAAP EPS reconciliation⁴:
GAAP net income (loss) attributable to stockholders	$	13,742		$	11,170		$	(208,342	)	$	(174,595	)	$	41,868
Add back items:
Amortization of definite-lived intangibles		2,515			4,546			4,104			14,684			17,427
Stock-based compensation		2,821			2,143			2,457			10,266			8,075
Non-cash interest expense		2,016			1,947			1,977			7,893			8,163
Impairments, restructuring and other charges		—			15,184			223,944			223,944			63,309
Income tax effects		(2,447	)		(5,666	)		(6,045	)		(13,069	)		(12,379	)

Non-GAAP net income attributable to stockholders	$	18,647		$	29,324		$	18,095		$	69,123		$	126,463
Non-GAAP earnings per diluted share attributable to stockholders	$	0.23		$	0.36		$	0.22		$	0.84		$	1.54

This information provides a reconciliation of EBITDA, adjusted EBITDA, GAAP net income (excluding impairments) attributable to stockholders, GAAP EPS (excluding impairments) attributable to stockholders, non-GAAP net income attributable to stockholders and non-GAAP EPS attributable to stockholders to the financial information in our consolidated statements of operations.

Adjusted EBITDA is defined as earnings before interest expense, income taxes, depreciation, amortization and asset impairments. 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.

³	This information provides GAAP net income attributable to stockholders and GAAP EPS attributable to stockholders excluding asset impairments and related income tax effects.

⁴

This information provides non-GAAP net income attributable to stockholders and non-GAAP EPS attributable to stockholders, 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), asset impairments, restructuring and other charges 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.

SIGNATURE

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.