COSTA MESA, Calif., Feb. 06, 2019 (GLOBE NEWSWIRE) -- TTM Technologies, Inc. (NASDAQ:TTMI), a leading global printed circuit board (“PCB”) and radio frequency (“RF”) components manufacturer, today reported results for the fourth quarter and full year of fiscal 2018, which ended December 31st, 2018.
Fourth Quarter 2018 Highlights
- Net sales were $711.0 million
- GAAP net income was $52.5 million, or $0.42 per diluted share
- Non-GAAP net income was $55.0 million, or $0.52 per diluted share
- Cash flow from operations of $151.8 million
- Repaid $70 million of our Term Loan B in Q4 and an additional $30 million on February 1st, 2019
Fiscal Year 2018 Highlights
- Net sales were $2.85 billion, a record high
- GAAP net income was $173.6 million, or $1.38 per diluted share
- Non-GAAP net income was $190.4 million, or $1.76 per diluted share, a record high
- Cash flow from operations of $273.1 million
- Repaid $114 million of our Term Loan B in 2018
Fourth Quarter 2018 Financial Results
Net sales for the fourth quarter of 2018 were $711.0 million, compared to $739.3 million in the fourth quarter of 2017 and $755.8 million in the third quarter of 2018.
GAAP operating income for the fourth quarter of 2018 was $42.8 million, compared to $71.0 million in the fourth quarter of 2017 and $54.6 million in the third quarter of 2018.
GAAP net income for the fourth quarter of 2018 was $52.5 million, or $0.42 per diluted share. This compares to $49.2 million, or $0.40 per diluted share, in the fourth quarter of 2017 and $27.0 million, or $0.22 per diluted share, in the third quarter of 2018. The current quarter results reflect the release of a tax valuation allowance of $43.6 million.
On a non-GAAP basis, net income for the fourth quarter of 2018 was $55.0 million, or $0.52 per diluted share. This compares to non-GAAP net income of $61.2 million, or $0.57 per diluted share, for the fourth quarter of 2017 and $55.1 million, or $0.50 per diluted share, in the third quarter of 2018.
Adjusted EBITDA for the fourth quarter of 2018 was $117.4 million, or 16.5 percent of net sales, compared to adjusted EBITDA of $121.7 million, or 16.5 percent of net sales, for the fourth quarter of 2017 and $122.3 million, or 16.2 percent of net sales, for the third quarter of 2018.
“For the fourth quarter, TTM delivered earnings above the high end of guidance, despite softening commercial end markets,” said Tom Edman, CEO of TTM. “We were pleased to see strong year over year growth from the aerospace and defense, computing and medical/industrial/instrumentation end markets that partially offset weakness in our cellular and automotive end markets. Solid operational execution and expense management resulted in our operating margin exceeding expectations.”
Full Year 2018 Financial Results
Net sales for fiscal year 2018 increased to $2.85 billion from $2.66 billion in fiscal year 2017, a 7.1% increase year over year.
GAAP operating income for fiscal year 2018 was $159.1 million, a decrease from GAAP operating income of $212.8 million in fiscal year 2017.
GAAP net income for fiscal year 2018 was $173.6 million, or $1.38 per diluted share, compared to GAAP net income of $124.2 million, or $1.04 per diluted share, for fiscal year 2017. The 2018 results reflect the release of a tax valuation allowance of $118.2 million.
On a non-GAAP basis, net income for fiscal year 2018 was $190.4 million, or $1.76 per diluted share. This compares to fiscal year 2017 non-GAAP net income of $167.1 million, or $1.57 per diluted share.
Adjusted EBITDA for fiscal year 2018 was $438.8 million, or 15.4 percent of net sales, compared to $388.6 million, or 14.6 percent of net sales, for fiscal year 2017.
"2018 validated TTM’s strategy of diversification, differentiation and discipline. We saw solid organic growth in the aerospace and defense, medical, industrial and instrumentation and computing end markets," continued Edman. “In addition, we closed the acquisition of Anaren which allows us to engage with customers earlier in the design cycle providing differentiated, value added RF solutions.”
Business Outlook
For the first quarter of 2019 TTM estimates that revenue will be in the range of $610 million to $650 million, and non-GAAP net income will be in the range of $0.14 to $0.20 per diluted share.
“In the first quarter of 2019, we are seeing significant weakness in our cellular end market which is resulting in the under-utilization of our advanced technology factories. Consequently, we are exercising discipline in managing our costs and focusing on continued cash flow generation. Longer term, we are confident in our diversification and differentiation strategy as well as secular growth drivers such as 5G wireless technology, increasing automotive electronic content, and ongoing demand strength in aerospace and defense electronics,” concluded Mr. Edman.
To Access the Live Webcast/Conference Call
TTM will host a conference call and webcast to discuss fourth quarter 2018 results and first quarter 2019 outlook on Wednesday, February 6, 2019, 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 866-548-4713 or international 323-794-2093 (ID 3216797). 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, backplane assemblies and electro-mechanical solutions as well as a global designer and manufacturer of RF and microwave 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
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, 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.
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 such 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 such 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) | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | Full Year | |||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2018 | 2017 | |||||||||||||||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
| Net sales | $ | 710,955 | $ | 739,349 | $ | 755,837 | $ | 2,847,261 | $ | 2,658,592 | |||||||||||||||
| Cost of goods sold | 588,323 | 607,488 | 626,253 | 2,390,227 | 2,229,011 | ||||||||||||||||||||
| Gross profit | 122,632 | 131,861 | 129,584 | 457,034 | 429,581 | ||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||
| Selling and marketing | 18,533 | 17,081 | 18,533 | 73,313 | 65,856 | ||||||||||||||||||||
| General and administrative | 39,615 | 37,764 | 39,974 | 159,437 | 128,489 | ||||||||||||||||||||
| Amortization of definite-lived intangibles | 17,722 | 5,907 | 16,609 | 59,681 | 23,634 | ||||||||||||||||||||
| Restructuring charges | 3,962 | 65 | (82 | ) | 5,518 | 1,190 | |||||||||||||||||||
| (Gain)/loss on sale of assets | - | - | - | - | (2,348 | ) | |||||||||||||||||||
| Total operating expenses | 79,832 | 60,817 | 75,034 | 297,949 | 216,821 | ||||||||||||||||||||
| Operating income | 42,800 | 71,044 | 54,550 | 159,085 | 212,760 | ||||||||||||||||||||
| Interest expense | (22,533 | ) | (13,782 | ) | (22,225 | ) | (78,958 | ) | (53,898 | ) | |||||||||||||||
| Loss on extinguishment of debt | - | - | - | - | (769 | ) | |||||||||||||||||||
| Other, net | 2,357 | (3,617 | ) | 2,213 | 9,641 | (18,135 | ) | ||||||||||||||||||
| Income before income taxes | 22,624 | 53,645 | 34,538 | 89,768 | 139,958 | ||||||||||||||||||||
| Income tax (provision) / benefit | 29,858 | (4,329 | ) | (7,537 | ) | 83,816 | (15,231 | ) | |||||||||||||||||
| Net income | $ | 52,482 | $ | 49,316 | $ | 27,001 | $ | 173,584 | $ | 124,727 | |||||||||||||||
| Net income attributable to noncontrolling interest | - | (105 | ) | - | - | (513 | ) | ||||||||||||||||||
| Net income attributable to stockholders | $ | 52,482 | $ | 49,211 | $ | 27,001 | $ | 173,584 | $ | 124,214 | |||||||||||||||
| Earnings per share attributable to stockholders: | |||||||||||||||||||||||||
| Basic | $ | 0.51 | $ | 0.48 | $ | 0.26 | $ | 1.68 | $ | 1.22 | |||||||||||||||
| Diluted | $ | 0.42 | $ | 0.40 | $ | 0.22 | $ | 1.38 | $ | 1.04 | |||||||||||||||
| Weighted-average shares used in computing per share amounts: | |||||||||||||||||||||||||
| Basic | 103,683 | 101,817 | 103,676 | 103,355 | 101,580 | ||||||||||||||||||||
| Diluted | 131,533 | 133,170 | 136,435 | 134,036 | 132,476 | ||||||||||||||||||||
| Reconciliation of the numerator and denominator used to calculate basic earnings per share and diluted earnings per share: | |||||||||||||||||||||||||
| Net income attributable to stockholders | $ | 52,482 | $ | 49,211 | $ | 27,001 | $ | 173,584 | $ | 124,214 | |||||||||||||||
| Add back items: interest expense, net of tax | 3,030 | 3,508 | 3,628 | 11,906 | 13,803 | ||||||||||||||||||||
| Adjusted net income attributable to stockholders | $ | 55,512 | $ | 52,719 | $ | 30,629 | $ | 185,490 | $ | 138,017 | |||||||||||||||
| Weighted-average shares outstanding | 103,683 | 101,817 | 103,676 | 103,355 | 101,580 | ||||||||||||||||||||
| Dilutive effect of convertible debt | 25,939 | 25,939 | 25,938 | 25,939 | 25,940 | ||||||||||||||||||||
| Dilutive effect of warrants | - | 2,938 | 5,226 | 3,065 | 2,799 | ||||||||||||||||||||
| Dilutive effect of performance-based stock units, restricted stock units & stock options | 1,911 | 2,476 | 1,595 | 1,677 | 2,157 | ||||||||||||||||||||
| Diluted shares | 131,533 | 133,170 | 136,435 | 134,036 | 132,476 | ||||||||||||||||||||
| Earnings per share attributable to stockholders: | |||||||||||||||||||||||||
| Basic | $ | 0.51 | $ | 0.48 | $ | 0.26 | $ | 1.68 | $ | 1.22 | |||||||||||||||
| Diluted | $ | 0.42 | $ | 0.40 | $ | 0.22 | $ | 1.38 | $ | 1.04 | |||||||||||||||
| SELECTED BALANCE SHEET DATA | |||||||||||||||||||||||||
| December 31, 2018 | January 1, 2018 | ||||||||||||||||||||||||
| Cash and cash equivalents, including restricted cash | $ | 256,360 | $ | 409,326 | |||||||||||||||||||||
| Accounts and notes receivable, net | 523,165 | 483,903 | |||||||||||||||||||||||
| Contract assets | 287,741 | - | |||||||||||||||||||||||
| Inventories | 109,377 | 294,588 | |||||||||||||||||||||||
| Total current assets | 1,206,914 | 1,221,307 | |||||||||||||||||||||||
| Property, plant and equipment, net | 1,052,024 | 1,056,845 | |||||||||||||||||||||||
| Other non-current assets | 1,198,565 | 503,730 | |||||||||||||||||||||||
| Total assets | 3,457,503 | 2,781,882 | |||||||||||||||||||||||
| Short-term debt, including current portion of long-term debt | $ | 30,000 | $ | 4,578 | |||||||||||||||||||||
| Accounts payable | 431,288 | 497,455 | |||||||||||||||||||||||
| Total current liabilities | 673,214 | 720,356 | |||||||||||||||||||||||
| Debt, net of discount | 1,462,425 | 975,479 | |||||||||||||||||||||||
| Total long-term liabilities | 1,557,202 | 1,050,146 | |||||||||||||||||||||||
| Total equity | 1,227,087 | 1,011,380 | |||||||||||||||||||||||
| Total liabilities and equity | 3,457,503 | 2,781,882 | |||||||||||||||||||||||
| SUPPLEMENTAL DATA | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | Full Year | |||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2018 | 2017 | |||||||||||||||||||||
| Gross margin | 17.2 | % | 17.8 | % | 17.1 | % | 16.1 | % | 16.2 | % | |||||||||||||||
| Operating margin | 6.0 | % | 9.6 | % | 7.2 | % | 5.6 | % | 8.0 | % | |||||||||||||||
| End Market Breakdown: | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | ||||||||||||||||||||||||
| 2018 | 2017 | 2018 | |||||||||||||||||||||||
| Aerospace/Defense | 24 | % | 15 | % | 23 | % | |||||||||||||||||||
| Automotive | 16 | % | 18 | % | 15 | % | |||||||||||||||||||
| Cellular Phone | 14 | % | 27 | % | 17 | % | |||||||||||||||||||
| Computing/Storage/Peripherals | 13 | % | 10 | % | 14 | % | |||||||||||||||||||
| Medical/Industrial/Instrumentation | 14 | % | 12 | % | 13 | % | |||||||||||||||||||
| Networking/Communications | 18 | % | 17 | % | 17 | % | |||||||||||||||||||
| Other | 1 | % | 1 | % | 1 | % | |||||||||||||||||||
| Stock-based Compensation: | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | ||||||||||||||||||||||||
| 2018 | 2017 | 2018 | |||||||||||||||||||||||
| Amount included in: | |||||||||||||||||||||||||
| Cost of goods sold | $ | 766 | $ | 613 | $ | 774 | |||||||||||||||||||
| Selling and marketing | 525 | 450 | 520 | ||||||||||||||||||||||
| General and administrative | 4,442 | 3,921 | 4,165 | ||||||||||||||||||||||
| Total stock-based compensation expense | $ | 5,733 | $ | 4,984 | $ | 5,459 | |||||||||||||||||||
| Operating Segment Data: | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | ||||||||||||||||||||||||
| Net sales: | 2018 | 2017 | 2018 | ||||||||||||||||||||||
| PCB | $ | 655,706 | $ | 688,572 | $ | 698,983 | |||||||||||||||||||
| E-M Solutions | 57,473 | 54,899 | 59,481 | ||||||||||||||||||||||
| Corporate | - | - | - | ||||||||||||||||||||||
| Total sales | 713,179 | 743,471 | 758,464 | ||||||||||||||||||||||
| Inter-segment sales | (2,224 | ) | (4,122 | ) | (2,627 | ) | |||||||||||||||||||
| Total net sales | $ | 710,955 | $ | 739,349 | $ | 755,837 | |||||||||||||||||||
| Operating segment income: | |||||||||||||||||||||||||
| PCB | $ | 87,201 | $ | 100,352 | $ | 98,039 | |||||||||||||||||||
| E-M Solutions | 3,364 | 2,799 | 2,205 | ||||||||||||||||||||||
| Corporate | (28,863 | ) | (26,200 | ) | (26,920 | ) | |||||||||||||||||||
| Total operating segment income | 61,702 | 76,951 | 73,324 | ||||||||||||||||||||||
| Amortization of definite-lived intangibles | (18,902 | ) | (5,907 | ) | (18,774 | ) | |||||||||||||||||||
| Total operating income | 42,800 | 71,044 | 54,550 | ||||||||||||||||||||||
| Total other expense | (20,176 | ) | (17,399 | ) | (20,012 | ) | |||||||||||||||||||
| Income before income taxes | $ | 22,624 | $ | 53,645 | $ | 34,538 | |||||||||||||||||||
| RECONCILIATIONS1 | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | Full Year | |||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2018 | 2017 | |||||||||||||||||||||
| Non-GAAP gross profit reconciliation2: | |||||||||||||||||||||||||
| GAAP gross profit | $ | 122,632 | $ | 131,861 | $ | 129,584 | $ | 457,034 | $ | 429,581 | |||||||||||||||
| Add back item: | |||||||||||||||||||||||||
| Inventory markup | - | - | - | 4,900 | - | ||||||||||||||||||||
| Amortization of definite-lived intangibles | 1,180 | - | 2,165 | 3,345 | - | ||||||||||||||||||||
| Stock-based compensation | 766 | 613 | 774 | 2,898 | 2,252 | ||||||||||||||||||||
| Non-GAAP gross profit | $ | 124,578 | $ | 132,474 | $ | 132,523 | $ | 468,177 | $ | 431,833 | |||||||||||||||
| Non-GAAP gross margin | 17.5 | % | 17.9 | % | 17.5 | % | 16.4 | % | 16.2 | % | |||||||||||||||
| Non-GAAP operating income reconciliation3: | |||||||||||||||||||||||||
| GAAP operating income | $ | 42,800 | $ | 71,044 | $ | 54,550 | $ | 159,085 | $ | 212,760 | |||||||||||||||
| Add back items: | |||||||||||||||||||||||||
| Amortization of definite-lived intangibles | 18,902 | 5,907 | 18,774 | 63,026 | 23,634 | ||||||||||||||||||||
| Stock-based compensation | 5,733 | 4,984 | 5,459 | 20,681 | 18,290 | ||||||||||||||||||||
| (Gain)/loss on sale of assets | - | - | - | - | (2,348 | ) | |||||||||||||||||||
| Inventory markup | - | - | - | 4,900 | - | ||||||||||||||||||||
| Impairments, restructuring, acquisition-related, and other charges | 6,104 | 2,331 | 230 | 18,797 | 3,556 | ||||||||||||||||||||
| Non-GAAP operating income | $ | 73,539 | $ | 84,266 | $ | 79,013 | $ | 266,489 | $ | 255,892 | |||||||||||||||
| Non-GAAP operating margin | 10.3 | % | 11.4 | % | 10.5 | % | 9.4 | % | 9.6 | % | |||||||||||||||
| Non-GAAP net income and EPS attributable to stockholders reconciliation4: | |||||||||||||||||||||||||
| GAAP net income attributable to stockholders | $ | 52,482 | $ | 49,211 | $ | 27,001 | $ | 173,584 | $ | 124,214 | |||||||||||||||
| Add back items: | |||||||||||||||||||||||||
| Amortization of definite-lived intangibles | 18,902 | 5,907 | 18,774 | 63,026 | 23,634 | ||||||||||||||||||||
| Stock-based compensation | 5,733 | 4,984 | 5,459 | 20,681 | 18,290 | ||||||||||||||||||||
| Non-cash interest expense | 4,384 | 3,017 | 3,992 | 14,783 | 11,069 | ||||||||||||||||||||
| (Gain)/loss on sale of assets | - | - | - | - | (2,348 | ) | |||||||||||||||||||
| Inventory markup | - | - | - | 4,900 | - | ||||||||||||||||||||
| Loss on extinguishment of debt | - | - | - | - | 769 | ||||||||||||||||||||
| Impairments, restructuring, acquisition-related, and other charges | 6,104 | 2,331 | 230 | 19,339 | 3,556 | ||||||||||||||||||||
| Income taxes5 | (32,614 | ) | (4,204 | ) | (337 | ) | (105,916 | ) | (12,059 | ) | |||||||||||||||
| Non-GAAP net income attributable to stockholders | $ | 54,991 | $ | 61,246 | $ | 55,119 | $ | 190,397 | $ | 167,125 | |||||||||||||||
| Non-GAAP earnings per diluted share attributable to stockholders | $ | 0.52 | $ | 0.57 | $ | 0.50 | $ | 1.76 | $ | 1.57 | |||||||||||||||
| Non-GAAP diluted number of shares6: | |||||||||||||||||||||||||
| Diluted shares | 131,533 | 133,170 | 136,435 | 134,036 | 132,476 | ||||||||||||||||||||
| Dilutive effect of convertible debt | (25,939 | ) | (25,939 | ) | (25,938 | ) | (25,939 | ) | (25,940 | ) | |||||||||||||||
| Non-GAAP diluted number of shares | 105,594 | 107,231 | 110,497 | 108,097 | 106,536 | ||||||||||||||||||||
| Adjusted EBITDA reconciliation7: | |||||||||||||||||||||||||
| GAAP net income | $ | 52,482 | $ | 49,316 | $ | 27,001 | $ | 173,584 | $ | 124,727 | |||||||||||||||
| Add back items: | |||||||||||||||||||||||||
| Income tax provision (benefit) | (29,858 | ) | 4,329 | 7,537 | (83,816 | ) | 15,231 | ||||||||||||||||||
| Interest expense | 22,533 | 13,782 | 22,225 | 78,958 | 53,898 | ||||||||||||||||||||
| Amortization of definite-lived intangibles | 18,902 | 5,907 | 18,774 | 63,026 | 23,634 | ||||||||||||||||||||
| Depreciation expense | 41,543 | 41,090 | 41,092 | 162,708 | 150,809 | ||||||||||||||||||||
| Stock-based compensation | 5,733 | 4,984 | 5,459 | 20,681 | 18,290 | ||||||||||||||||||||
| (Gain)/loss on sale of assets | - | - | - | - | (2,348 | ) | |||||||||||||||||||
| Inventory markup | - | - | - | 4,900 | - | ||||||||||||||||||||
| Loss on extinguishment of debt | - | - | - | - | 769 | ||||||||||||||||||||
| Impairments, restructuring, acquisition-related, and other charges | 6,104 | 2,331 | 230 | 18,797 | 3,556 | ||||||||||||||||||||
| Adjusted EBITDA | $ | 117,439 | $ | 121,739 | $ | 122,318 | $ | 438,838 | $ | 388,566 | |||||||||||||||
| Adjusted EBITDA margin | 16.5 | % | 16.5 | % | 16.2 | % | 15.4 | % | 14.6 | % | |||||||||||||||
| Free cash flow reconciliation: | |||||||||||||||||||||||||
| Operating cash flow | 151,768 | 152,691 | 79,992 | 273,138 | 332,755 | ||||||||||||||||||||
| Capital expenditures, net | (33,671 | ) | (32,209 | ) | (35,038 | ) | (149,796 | ) | (124,090 | ) | |||||||||||||||
| Free cash flow | $ | 118,097 | $ | 120,482 | $ | 44,954 | $ | 123,342 | $ | 208,665 | |||||||||||||||
| 1 This information provides a reconciliation of non-GAAP gross profit, non-GAAP operating income, non-GAAP net income attributable to stockholders, non-GAAP EPS attributable to stockholders, 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, asset impairments, restructuring and other charges. | |||||||||||||||||||||||||
| 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), gain on sale of assets, inventory markup, acquisition-related costs, asset impairments, 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 an annual GAAP tax rate. | |||||||||||||||||||||||||
| 6 Non-GAAP diluted number of shares used in computing non-GAAP earnings per share attributable to stockholders 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, asset impairments, 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. | |||||||||||||||||||||||||
Contact:
Sameer Desai,
Senior Director, Corporate Development & Investor Relations
Sameer.desai@ttmtech.com
714-327-3050