TTM Technologies, Inc. Q2'22 Earnings Results Presentation August 3rd, 2022 Inspiring Innovation Disclaimers 2 Forward-Looking Statements This communication may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to the future business outlook, events, and expected performance of TTM Technologies, Inc. ("TTM", "we" or the "Company"). The words "anticipate," "believe," "plan," "forecast," "foresee," "estimate," "project ...

PART I: FINANCIAL INFORMATION This part presents TTM Technologies, Inc.'s unaudited consolidated condensed financial statements and notes [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section details TTM Technologies' unaudited Q1 2022 financial statements, including balance sheets, income, cash flows, and notes [Consolidated Condensed Balance Sheets](index=3&type=section&id=Consolidated%20Condensed%20Balance%20Sheets) This section presents the company's consolidated condensed balance sheets as of April 4, 2022, and January 3, 2022 Consolidated Condensed Balance Sheet Highlights (In thousands) | Item | April 4, 2022 | January 3, 2022 | | :--------------------------------- | :------------ | :------------ | | **ASSETS** | | | | Total current assets | $1,434,183 | $1,407,413 | | Property, plant and equipment, net | $663,394 | $665,755 | | Goodwill | $637,324 | $637,324 | | Total assets | $3,044,148 | $3,025,547 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Total current liabilities | $586,566 | $558,148 | | Long-term debt, net | $928,210 | $927,818 | | Total liabilities | $1,596,319 | $1,570,130 | | Total stockholders' equity | $1,447,829 | $1,455,417 | | Total liabilities and stockholders' equity | $3,044,148 | $3,025,547 | [Consolidated Condensed Statements of Operations](index=4&type=section&id=Consolidated%20Condensed%20Statements%20of%20Operations) This section presents the company's consolidated condensed statements of operations for Q1 2022 and Q1 2021 Consolidated Condensed Statements of Operations Highlights (In thousands, except per share data) | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | Net sales | $581,260 | $526,432 | | Gross profit | $90,923 | $81,600 | | Operating income | $25,868 | $19,800 | | Income (loss) before income taxes | $16,477 | $(4,299) | | Net income (loss) | $17,246 | $(3,192) | | Basic earnings (loss) per share | $0.17 | $(0.03) | | Diluted earnings (loss) per share | $0.17 | $(0.03) | [Consolidated Condensed Statements of Comprehensive Income (Loss)](index=5&type=section&id=Consolidated%20Condensed%20Statements%20of%20Comprehensive%20Income%20(Loss)) This section presents the company's consolidated condensed statements of comprehensive income (loss) for Q1 2022 and Q1 2021 Consolidated Condensed Statements of Comprehensive Income (Loss) Highlights (In thousands) | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | Net income (loss) | $17,246 | $(3,192) | | Other comprehensive income, net of tax | $2,151 | $1,786 | | Comprehensive income (loss), net of tax | $19,397 | $(1,406) | [Consolidated Condensed Statements of Stockholders' Equity](index=6&type=section&id=Consolidated%20Condensed%20Statements%20of%20Stockholders'%20Equity) This section presents the company's consolidated condensed statements of stockholders' equity for Q1 2022 Consolidated Condensed Statements of Stockholders' Equity Highlights (In thousands) | Item | Balance, January 3, 2022 | Balance, April 4, 2022 | | :--------------------------------- | :----------------------- | :--------------------- | | Total Stockholders' Equity | $1,455,417 | $1,447,829 | | Net income | $17,246 | | | Other comprehensive income | $2,151 | | | Repurchases of common stock | $(30,232) | | | Stock-based compensation | $4,234 | | [Consolidated Condensed Statements of Cash Flows](index=7&type=section&id=Consolidated%20Condensed%20Statements%20of%20Cash%20Flows) This section presents the company's consolidated condensed statements of cash flows for Q1 2022 and Q1 2021 Consolidated Condensed Statements of Cash Flows Highlights (In thousands) | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | Net cash provided by operating activities | $35,991 | $41,145 | | Net cash used in investing activities | $(23,420) | $(20,966) | | Net cash (used in) provided by financing activities | $(31,119) | $68,080 | | Net (decrease) increase in cash and cash equivalents | $(18,599) | $88,083 | | Cash and cash equivalents at end of period | $519,079 | $539,648 | [Note 1. Nature of Operations and Basis of Presentation](index=8&type=section&id=Note%201.%20Nature%20of%20Operations%20and%20Basis%20of%20Presentation) This note describes TTM Technologies' core business as a global PCB and RF/microwave components manufacturer - TTM Technologies, Inc. is a global printed circuit board (PCB) manufacturer and a designer/manufacturer of high-frequency radio frequency (RF) and microwave/microelectronics components and assemblies. The company offers a one-stop design, engineering, and manufacturing solution to customers across aerospace and defense, data center computing, automotive, medical, industrial, and networking/communications markets[22](index=22&type=chunk)[23](index=23&type=chunk) - The company early adopted ASU 2021-08 on April 4, 2022, which changes the accounting for contract assets and liabilities acquired in business combinations to align with ASC 606. The impact on future financial statements will depend on the nature and magnitude of acquired entities[25](index=25&type=chunk) [Note 2. Share Repurchase Program](index=9&type=section&id=Note%202.%20Share%20Repurchase%20Program) This note details the company's share repurchase program, including authorization and activity for Q1 2022 - The Board of Directors authorized a share repurchase program on February 3, 2021, allowing the company to repurchase up to **$100,000 thousand** of common stock through February 3, 2023[27](index=27&type=chunk) Share Repurchase Activity (In thousands) | Period | Shares Repurchased | Total Cost | | :--------------------------------- | :----------------- | :--------- | | Quarter ended April 4, 2022 | 2,373 | $30,232 | | Remaining available as of April 4, 2022 | | $5,184 | | Subsequent to April 4, 2022 (as of May 4, 2022) | 374 | $5,192 | | Total repurchased under program | 7,500 | $100,000 | [Note 3. Leases](index=9&type=section&id=Note%203.%20Leases) This note provides details on the company's lease expenses and related balance sheet information Lease Expense Components (In thousands) | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | Operating lease cost | $1,884 | $2,208 | | Variable lease cost | $246 | $234 | | Short-term lease cost | $140 | $54 | | Amortization of right-of-use assets (Finance leases) | $344 | — | | Interest on lease liabilities (Finance leases) | $98 | — | Supplemental Balance Sheet Information Related to Leases (In thousands) | Item | April 4, 2022 | January 3, 2022 | | :--------------------------------- | :------------ | :------------ | | Operating lease right-of-use assets | $19,503 | $20,802 | | Finance leases (Property, plant and equipment, net) | $14,415 | $14,759 | | Total lease assets | $33,918 | $35,561 | | Operating lease liabilities (Current) | $6,423 | $6,362 | | Finance lease liabilities (Current) | $702 | $698 | | Operating lease liabilities (Long-term) | $13,917 | $15,252 | | Finance lease liabilities (Long-term) | $14,139 | $14,317 | | Total lease liabilities | $35,181 | $36,629 | [Note 4. Revenues](index=11&type=section&id=Note%204.%20Revenues) This note details revenue recognition policies and disaggregates net sales by end markets and segments - For long-term contracts, **$11,877 thousand** of transaction price is allocated to remaining performance obligations as of April 4, 2022. Approximately **48%** of this revenue is expected to be recognized over the next twelve months[33](index=33&type=chunk) Revenue Disaggregation by Principal End Markets and Reportable Segments (In thousands) | End Markets | Quarter Ended April 4, 2022 (PCB) | Quarter Ended April 4, 2022 (RF&S Components) | Quarter Ended April 4, 2022 (Total) | Quarter Ended March 29, 2021 (PCB) | Quarter Ended March 29, 2021 (RF&S Components) | Quarter Ended March 29, 2021 (Other) | Quarter Ended March 29, 2021 (Total) | | :--------------------------------- | :-------------------------------- | :------------------------------------------ | :-------------------------------- | :-------------------------------- | :------------------------------------------ | :-------------------------- | :-------------------------------- | | Aerospace and Defense | $172,180 | $— | $172,180 | $186,539 | $6 | $— | $186,545 | | Automotive | $115,236 | $— | $115,236 | $91,792 | $— | $3,642 | $95,434 | | Data Center Computing | $91,784 | $— | $91,784 | $71,759 | $432 | $— | $72,191 | | Medical/Industrial/Instrumentation | $120,362 | $1,538 | $121,900 | $90,770 | $1,081 | $25 | $91,876 | | Networking/Communications | $63,643 | $13,757 | $77,400 | $66,938 | $10,653 | $1 | $77,592 | | Other | $2,865 | $(105) | $2,760 | $2,688 | $518 | $(412) | $2,794 | | Total | $566,070 | $15,190 | $581,260 | $510,486 | $12,690 | $3,256 | $526,432 | [Note 5. Composition of Certain Consolidated Condensed Financial Statement Captions](index=12&type=section&id=Note%205.%20Composition%20of%20Certain%20Consolidated%20Condensed%20Financial%20Statement%20Captions) This note provides detailed breakdowns of inventories and property, plant, and equipment, net Inventories (In thousands) | Item | April 4, 2022 | January 3, 2022 | | :----------------- | :------------ | :------------ | | Raw materials | $123,322 | $114,653 | | Work-in-process | $9,424 | $9,620 | | Finished goods | $4,597 | $3,339 | | Total Inventories | $137,343 | $127,612 | Property, Plant and Equipment, Net (In thousands) | Item | April 4, 2022 | January 3, 2022 | | :--------------------------------- | :------------ | :------------ | | Land and land use rights | $62,080 | $62,015 | | Buildings and improvements | $434,308 | $429,344 | | Machinery and equipment | $906,406 | $891,925 | | Furniture and fixtures and other | $10,406 | $10,360 | | Construction-in-progress | $23,277 | $25,554 | | Less: Accumulated depreciation | $(773,083) | $(753,443) | | Total Property, plant and equipment, net | $663,394 | $665,755 | [Note 6. Goodwill](index=12&type=section&id=Note%206.%20Goodwill) This note presents the allocation of goodwill by reportable segment as of April 4, 2022 Goodwill by Reportable Segment (In thousands) | Segment | Goodwill (January 3, 2022 & April 4, 2022) | | :----------------- | :----------------------------------------- | | PCB | $529,324 | | RF&S Components | $108,000 | | Total Goodwill | $637,324 | [Note 7. Definite-lived Intangibles](index=13&type=section&id=Note%207.%20Definite-lived%20Intangibles) This note details the net carrying amount and amortization expense for definite-lived intangible assets Definite-lived Intangibles (In thousands) | Item | April 4, 2022 (Net Carrying Amount) | January 3, 2022 (Net Carrying Amount) | | :--------------------------------- | :---------------------------------- | :---------------------------------- | | Customer relationships | $203,335 | $211,610 | | Technology | $26,925 | $28,308 | | Total | $230,260 | $239,918 | - Amortization expense for definite-lived intangibles was **$9,658 thousand** for the quarter ended April 4, 2022, and **$10,905 thousand** for the quarter ended March 29, 2021. **$1,384 thousand** of this expense was included in cost of goods sold for both periods[38](index=38&type=chunk) [Note 8. Long-term Debt and Letters of Credit](index=13&type=section&id=Note%208.%20Long-term%20Debt%20and%20Letters%20of%20Credit) This note summarizes the company's long-term debt, including interest rates and principal outstanding Long-term Debt Summary (In thousands) | Debt Type | Interest Rate (April 4, 2022) | Principal Outstanding (April 4, 2022) | Principal Outstanding (January 3, 2022) | | :--------------------------------- | :---------------------------- | :------------------------------------ | :------------------------------------ | | Senior Notes due March 2029 | 4.00% | $500,000 | $500,000 | | Term Loan due September 2024 | 2.93% | $405,879 | $405,879 | | Asia ABL Revolving Loan due June 2024 | 1.83% | $30,000 | $30,000 | | Total Long-term Debt, net | | $928,210 | $927,818 | - The company recognized a loss of **$15,217 thousand** on extinguishment of debt during the quarter ended March 29, 2021, related to the repayment of Senior Notes due 2025[45](index=45&type=chunk) [Note 9. Income Taxes](index=14&type=section&id=Note%209.%20Income%20Taxes) This note explains the effective tax rate, discrete tax benefits, and deferred tax liabilities - The effective tax rate for the quarter ended April 4, 2022, was impacted by a net discrete benefit of **$2,047 thousand**, primarily due to the renewal of High and New Tax Enterprise status for two manufacturing subsidiaries in China and windfall tax benefits from stock-based compensation releases[47](index=47&type=chunk) - A deferred tax liability has been recorded for expected repatriation of earnings from most foreign subsidiaries, but not for those with earnings currently being reinvested outside the U.S[48](index=48&type=chunk) [Note 10. Financial Instruments](index=14&type=section&id=Note%2010.%20Financial%20Instruments) This note details the company's use of derivative financial instruments for hedging interest rate and commodity risks - The company uses an interest rate swap to hedge LIBOR-based variable rate debt, paying a fixed rate of **2.84%** on a notional amount of **$400,000 thousand**. As of April 4, 2022, the fair value of this swap was a liability of **$1,385 thousand**, increasing interest expense by **$2,706 thousand** for the quarter[50](index=50&type=chunk)[51](index=51&type=chunk) - The company uses commodity contracts to hedge copper prices as a proxy for laminate costs, with a notional quantity of **0.5 to 0.7 metric tonnes** for periods extending into March 2023. As of April 4, 2022, the fair value was an asset of **$1,699 thousand**, decreasing cost of goods sold by **$1,402 thousand** for the quarter[53](index=53&type=chunk) Fair Values of Derivative Instruments (In thousands) | Item | Balance Sheet Location | April 4, 2022 | January 3, 2022 | | :--------------------------------- | :----------------------- | :------------ | :------------ | | Interest rate swap | Other current liabilities | $(1,385) | $(4,295) | | Commodity contracts | Prepaid expenses and other current assets | $1,699 | $297 | | Foreign exchange contracts | Other current liabilities | $(52) | $— | [Note 11. Accumulated Other Comprehensive Loss](index=16&type=section&id=Note%2011.%20Accumulated%20Other%20Comprehensive%20Loss) This note details the components of accumulated other comprehensive loss and expected reclassifications Components of Accumulated Other Comprehensive Loss (In thousands) | Item | January 3, 2022 | April 4, 2022 | | :--------------------------------- | :-------------- | :------------ | | Foreign Currency Translation | $(23,899) | $(23,935) | | Pension Obligation | $(133) | $(133) | | Gains on Cash Flow Hedges | $(3,223) | $(1,036) | | Total Accumulated Other Comprehensive Loss | $(27,255) | $(25,104) | - The company expects approximately **$1,087 thousand** of accumulated other comprehensive loss to be reclassified into the statement of operations in the next quarter due to the expiration of the interest rate swap arrangement on June 1, 2022[54](index=54&type=chunk) [Note 12. Significant Customers and Concentration of Credit Risk](index=16&type=section&id=Note%2012.%20Significant%20Customers%20and%20Concentration%20of%20Credit%20Risk) This note identifies significant customer concentrations and the company's approach to measuring them - One customer accounted for approximately **10%** of net sales for the quarter ended April 4, 2022, and **13%** for the quarter ended March 29, 2021[57](index=57&type=chunk) - The company measures customer concentration based on OEM companies, as they are the ultimate end customers, even when sales are directed through EMS providers[57](index=57&type=chunk) [Note 13. Fair Value Measures](index=16&type=section&id=Note%2013.%20Fair%20Value%20Measures) This note presents the fair values of financial instruments and the inputs used for their determination Fair Value of Financial Instruments (In thousands) | Item | April 4, 2022 (Carrying Amount) | April 4, 2022 (Fair Value) | January 3, 2022 (Carrying Amount) | January 3, 2022 (Fair Value) | | :--------------------------------- | :------------------------------ | :------------------------- | :-------------------------------- | :------------------------- | | Derivative assets, current | $1,699 | $1,699 | $297 | $297 | | Derivative liabilities, current | $1,437 | $1,437 | $4,295 | $4,295 | | Senior Notes due March 2029 | $494,720 | $465,035 | $494,556 | $498,200 | | Term Loan due September 2024 | $403,490 | $404,357 | $403,262 | $406,135 | | ABL Revolving Loans | $30,000 | $30,000 | $30,000 | $30,000 | - Fair values of derivative instruments are determined using Level 2 inputs (observable market data). Long-term debt fair values are estimated based on quoted market prices or discounting using current market rates for similar debt (Level 2 inputs)[59](index=59&type=chunk)[60](index=60&type=chunk) [Note 14. Commitments and Contingencies](index=17&type=section&id=Note%2014.%20Commitments%20and%20Contingencies) This note addresses the company's legal matters and the potential financial impact of their outcomes - The company is subject to various legal matters in the normal course of business. While the outcome is difficult to predict, any reasonably possible loss for known matters is not expected to be material to the company's financial condition[63](index=63&type=chunk) [Note 15. Earnings (Loss) Per Share](index=17&type=section&id=Note%2015.%20Earnings%20(Loss)%20Per%20Share) This note provides the reconciliation of basic and diluted earnings (loss) per share for Q1 2022 and Q1 2021 Earnings (Loss) Per Share Reconciliation (In thousands, except per share amounts) | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | Net income (loss) | $17,246 | $(3,192) | | Basic weighted average shares | 102,613 | 106,825 | | Diluted shares | 104,304 | 106,825 | | Basic earnings (loss) per share | $0.17 | $(0.03) | | Diluted earnings (loss) per share | $0.17 | $(0.03) | - Performance-based restricted stock units (PRUs), restricted stock units (RSUs), and stock options totaling **975 thousand shares** were excluded from diluted EPS computation for Q1 2022 due to anti-dilutive effects or unmet performance conditions[64](index=64&type=chunk) [Note 16. Stock-Based Compensation](index=18&type=section&id=Note%2016.%20Stock-Based%20Compensation) This note details stock-based compensation expense and unrecognized compensation costs by award type Stock-Based Compensation Expense (In thousands) | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | 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 | | Total Stock-based compensation expense | $4,234 | $4,209 | Unrecognized Compensation Costs (As of April 4, 2022, in thousands) | Award Type | Unrecognized Stock-Based Compensation Cost | Remaining Weighted Average Recognition Period (In years) | | :--------------------------------- | :----------------------------------------- | :------------------------------------------------------- | | RSU awards | $20,594 | 1.4 | | PRU awards | $1,092 | 0.8 | | Stock options | $25 | 0.5 | | Total | $21,711 | | [Note 17. Segment Information](index=18&type=section&id=Note%2017.%20Segment%20Information) This note provides disaggregated financial information by reportable segment and geographical area Net Sales by Segment (In thousands) | Segment | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | PCB | $566,070 | $510,486 | | RF&S Components | $15,190 | $12,690 | | Other | $— | $3,256 | | Total net sales | $581,260 | $526,432 | Operating Segment Income (Loss) (In thousands) | Segment | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | PCB | $56,540 | $57,232 | | RF&S Components | $5,750 | $3,862 | | Corporate and Other | $(26,764) | $(30,389) | | Total operating segment income | $35,526 | $30,705 | Net Sales by Geography (In thousands) | Geography | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | United States | $264,401 | $268,467 | | China | $77,205 | $81,709 | | Other | $239,654 | $176,256 | | Total net sales | $581,260 | $526,432 | [Note 18. Subsequent Events](index=19&type=section&id=Note%2018.%20Subsequent%20Events) This note describes the company's definitive agreement to acquire Telephonics Corporation and ISC Farmingdale Corp - On April 18, 2022, the company entered into a definitive share purchase agreement to acquire Telephonics Corporation and ISC Farmingdale Corp. for **$330,000 thousand** in cash, with the transaction expected to close in Q2 2022[76](index=76&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's analysis of TTM Technologies' Q1 2022 financial condition, operations, and strategic developments [Company Overview](index=20&type=section&id=COMPANY%20OVERVIEW) This section provides an overview of TTM Technologies' core business as a global PCB and RF/microwave components manufacturer - TTM Technologies is a leading global printed circuit board (PCB) manufacturer and a designer/manufacturer of high-frequency radio frequency (RF) and microwave/microelectronics components and assemblies. The company serves approximately **1,000 customers** in diverse markets including aerospace and defense, data center computing, automotive, medical, industrial, and networking/communications[79](index=79&type=chunk) [Recent Developments](index=20&type=section&id=RECENT%20DEVELOPMENTS) This section highlights recent developments, including COVID-19 impacts, supply chain management, and strategic acquisitions - The COVID-19 pandemic continues to cause disruptions, including temporary lockdown orders in China and production inefficiencies in North America due to Omicron variant surges, leading to labor shortages and supply chain constraints[80](index=80&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) - The company is actively managing supply chain constraints and higher raw material costs through supplier diversification, operational efficiency, and quotation adjustments[82](index=82&type=chunk) - On April 18, 2022, TTM entered an agreement to acquire Telephonics Corporation and ISC Farmingdale Corp. for **$330.0 million** in cash, expected to close in Q2 2022[84](index=84&type=chunk) - TTM announced plans to open a new, highly automated PCB manufacturing facility in Penang, Malaysia, with construction starting in late 2022 and total capital spending of **$130.0 million** spread from 2022 through 2025[85](index=85&type=chunk) [Financial Overview](index=21&type=section&id=FINANCIAL%20OVERVIEW) This section provides a financial overview, including customer concentration and revenue disaggregation by end market - Sales to the ten largest OEM customers accounted for **45%** of net sales for both Q1 2022 and Q1 2021[86](index=86&type=chunk) Percentage of Net Sales by End Market | End Markets | April 4, 2022 | March 29, 2021 | | :--------------------------------- | :------------ | :------------- | | Aerospace and Defense | 30 % | 35 % | | Automotive | 20 % | 18 % | | Data Center Computing | 16 % | 14 % | | Medical/Industrial/Instrumentation | 21 % | 17 % | | Networking/Communications | 13 % | 15 % | | Other | — % | 1 % | | Total | 100 % | 100 % | - Revenue from products and services transferred over time accounted for **97%** of revenue in Q1 2022 (**98%** in Q1 2021), while point-in-time recognition accounted for **3%** in Q1 2022 (**2%** in Q1 2021)[34](index=34&type=chunk) [Critical Accounting Policies and Estimates](index=22&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) This section confirms no material changes to critical accounting policies and estimates since January 3, 2022 - There were no material changes to the company's critical accounting policies and estimates since January 3, 2022[96](index=96&type=chunk) [Results of Operations](index=22&type=section&id=RESULTS%20OF%20OPERATIONS) This section analyzes the company's Q1 2022 operating results, including sales, gross margin, and expenses Key Financial Ratios as Percentage of Net Sales | Item | Quarter Ended April 4, 2022 | Quarter Ended March 29, 2021 | | :--------------------------------- | :-------------------------- | :--------------------------- | | Net sales | 100.0 % | 100.0 % | | Cost of goods sold | 84.4 % | 84.5 % | | Gross profit | 15.6 % | 15.5 % | | Total operating expenses | 11.1 % | 11.7 % | | Operating income | 4.5 % | 3.8 % | | Income (loss) before income taxes | 2.8 % | (0.8) % | | Net income (loss) | 3.0 % | (0.6) % | - Net sales increased by **$54.8 million (10.4%)** to **$581.3 million** in Q1 2022, primarily driven by a **$55.6 million (10.8%)** increase in the PCB segment due to higher demand in commercial end markets, offsetting a decline in Aerospace and Defense[98](index=98&type=chunk) - Overall gross margin slightly increased to **15.6%** in Q1 2022 from **15.5%** in Q1 2021. PCB segment gross margin decreased to **14.7%** (from **15.7%**) due to labor/production challenges in North America, while RF&S Components gross margin increased to **57.0%** (from **47.5%**) due to higher sales[99](index=99&type=chunk) - Selling and marketing expenses increased by **$2.0 million** to **$18.3 million** in Q1 2022, primarily due to higher commission and labor costs, remaining at **3.1%** of net sales[102](index=102&type=chunk) - General and administrative expenses increased by **$1.4 million** to **$33.0 million** in Q1 2022, mainly due to higher labor costs, bad debt, and acquisition/integration costs, partially offset by a **$3.0 million** decrease in restructuring charges[103](index=103&type=chunk) - Other expense, net, decreased by **$14.7 million** to **$9.4 million** in Q1 2022, primarily due to the absence of a **$15.2 million** loss on extinguishment of debt from the prior year[104](index=104&type=chunk) - Income tax benefit decreased by **$0.3 million** to **$0.8 million** in Q1 2022, mainly due to increased pre-tax income partially offset by tax benefits from High and New Enterprise status renewal in China[105](index=105&type=chunk) [Liquidity and Capital Resources](index=23&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash flows, capital expenditures, debt, and overall liquidity position - Cash provided by operating activities decreased to **$36.0 million** in Q1 2022 from **$41.1 million** in Q1 2021, primarily due to increased investment in working capital[108](index=108&type=chunk) - Net cash used in investing activities was **$23.4 million** in Q1 2022, mainly for property, plant, and equipment purchases[109](index=109&type=chunk) - Net cash used in financing activities was **$31.1 million** in Q1 2022, primarily due to **$30.2 million** in common stock repurchases and **$0.9 million** for warrant settlements[110](index=110&type=chunk) - As of April 4, 2022, cash and cash equivalents totaled **$519.1 million**, with **$186.3 million** held by foreign subsidiaries. Repatriation of foreign cash is not expected to incur material unaccrued tax obligations[111](index=111&type=chunk) - Total capital expenditures for 2022 are projected to be between **$110.0 million** and **$130.0 million**[112](index=112&type=chunk) - The company repurchased **2.4 million shares** for **$30.2 million** in Q1 2022. As of May 4, 2022, the **$100.0 million** share repurchase program is fully utilized[113](index=113&type=chunk) - Outstanding debt, net of discount and issuance costs, was **$928.2 million** as of April 4, 2022, and the company was in compliance with all debt covenants[114](index=114&type=chunk)[115](index=115&type=chunk) - The company anticipates sufficient liquidity from operations, cash on hand, and debt facilities to meet capital expenditures, debt service, and working capital needs for the next twelve months[116](index=116&type=chunk) - The company's revenue seasonality has shifted post-Mobility business divestiture, now experiencing modest softness in Q1 and Q3 due to holidays/vacations, leading to stronger Q2 and Q4 revenues[118](index=118&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to market risks, including interest rate, foreign currency, and commodity price fluctuations [Interest Rate Risks](index=25&type=section&id=Interest%20Rate%20Risks) This section discusses the company's exposure to interest rate risk on variable rate debt and hedging strategies - The company is exposed to interest rate risk on LIBOR-based variable rate debt. An interest rate swap fixed **$400.0 million** of variable rate debt at **2.84%** through June 1, 2022, increasing interest expense by **$2.7 million** in Q1 2022[124](index=124&type=chunk)[125](index=125&type=chunk) - After June 1, 2022, the **$400.0 million** LIBOR-based variable debt will be more sensitive to interest rate fluctuations as the company does not expect to enter a new swap arrangement[125](index=125&type=chunk) - As of April 4, 2022, **96.2%** of total debt was fixed rate. A **100 basis point** increase in variable rates would increase annual interest cost by **$0.4 million** (or **$4.4 million** without the swap arrangement)[126](index=126&type=chunk) - The market transition from LIBOR to SOFR is expected to be complicated, with potential volatility in SOFR rates and the need for credit adjustments[127](index=127&type=chunk)[128](index=128&type=chunk) [Foreign Currency Rate Risks](index=26&type=section&id=Foreign%20Currency%20Rate%20Risks) This section details the company's exposure to foreign currency exchange rate risks, primarily to the Renminbi - The company is exposed to foreign currency exchange rate risks, primarily to the Renminbi (RMB), affecting foreign operations' costs and balance sheet translation. Most foreign operations use the U.S. Dollar as functional currency, except for two China facilities using RMB[129](index=129&type=chunk) - Foreign subsidiaries may use forward exchange contracts for foreign currency risks related to machinery purchases. As of April 4, 2022, notional amount of foreign exchange contracts was approximately **$1.6 million** (**EUR 1.4 million**)[130](index=130&type=chunk) [Commodity Price Risks](index=26&type=section&id=Commodity%20Price%20Risks) This section outlines the company's exposure to commodity price risks, particularly for copper clad laminates - The company is exposed to commodity price risks, particularly for copper clad laminates (CCLs), a key PCB raw material. Copper is hedged as a proxy for laminate costs[131](index=131&type=chunk) - As of April 4, 2022, commodity contracts had a notional quantity ranging from **500 to 700 metric tonnes** for periods extending into March 2023. The fair value was an asset of **$1.7 million**, included in prepaid expenses and other current assets[131](index=131&type=chunk) [Debt Instruments](index=26&type=section&id=Debt%20Instruments) This section provides a summary of the fiscal calendar maturities for the company's long-term debt Fiscal Calendar Maturities of Long-term Debt (As of April 4, 2022, in thousands) | Debt Type | Remaining 2022 | 2023 | 2024 | 2025 | 2026 | Thereafter | Total | Fair Value | Weighted Average Interest Rate | | :--------------------------------- | :------------- | :--- | :--- | :--- | :--- | :--------- | :---- | :--------- | :----------------------------- | | US$ Variable Rate | $— | $— | $435,879 | $— | $— | $— | $435,879 | $434,357 | 2.85% | | US$ Fixed Rate | $— | $— | $— | $— | $— | $500,000 | $500,000 | $465,035 | 4.00% | | Total | $— | $— | $435,879 | $— | $— | $500,000 | $935,879 | $899,392 | | [Interest Rate Swap Contracts](index=26&type=section&id=Interest%20Rate%20Swap%20Contracts) This section details the key information regarding the company's interest rate swap contracts Interest Rate Swap Information (Quarter Ended April 4, 2022, in thousands, except interest rates) | Item | Value | | :--------------------------------- | :---- | | Average interest payout rate | 2.84% | | Interest payout amount | $(2,871) | | Average interest received rate | 0.16% | | Interest received amount | $164 | [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of disclosure controls and procedures and ongoing ERP system implementation - The CEO and CFO concluded that disclosure controls and procedures were effective as of April 4, 2022, providing reasonable assurance that required information is recorded, processed, summarized, and reported timely[134](index=134&type=chunk) - The company is continuing to expand its enterprise resource planning (ERP) system implementation to improve financial reporting efficiency, with no material changes to internal control over financial reporting during the quarter ended April 4, 2022[136](index=136&type=chunk)[137](index=137&type=chunk) PART II: OTHER INFORMATION This section presents other information, including legal proceedings, risk factors, equity sales, and exhibits [Item 1. Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) This section addresses the company's legal proceedings, noting that any reasonably possible loss is not expected to be material - The company is subject to various legal matters in the ordinary course of business, and while outcomes are difficult to predict, any reasonably possible loss for known matters is not expected to be material to the financial statements[140](index=140&type=chunk) [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) This section outlines significant risks to the company's business, including operational, financial, regulatory, and market factors [Risks Related to our Business](index=28&type=section&id=Risks%20Related%20to%20our%20Business) This section details risks related to business operations, including pandemics, acquisitions, and market competition - The COVID-19 pandemic continues to disrupt business operations, supply chains, and labor availability, leading to production inefficiencies and increased costs[143](index=143&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk) - Acquisitions and divestitures, such as the proposed Telephonics acquisition, carry risks including integration difficulties, diversion of management attention, unforeseen expenses, and potential loss of key employees or customers[147](index=147&type=chunk)[149](index=149&type=chunk) - Uncertainty in the global economy and financial markets, including the Russia-Ukraine conflict, could lead to declining demand, increased costs, supply chain disruptions, and heightened cybersecurity threats[152](index=152&type=chunk)[153](index=153&type=chunk) - International operations expose the company to risks like tariffs, unstable regulatory environments, currency fluctuations (especially RMB), and geopolitical unrest[154](index=154&type=chunk)[155](index=155&type=chunk)[171](index=171&type=chunk) - Rising labor costs, labor shortages, and high turnover rates, particularly in North America and China, could adversely affect production, increase costs, and impact financial performance[158](index=158&type=chunk)[161](index=161&type=chunk)[165](index=165&type=chunk) - Reliance on suppliers for raw materials (e.g., CCLs, copper) and equipment exposes the company to risks of price increases, extended lead times, and supply disruptions, exacerbated by macroeconomic trends and the COVID-19 pandemic[166](index=166&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) - The intensely competitive and volatile electronics industry, coupled with high fixed operating costs, means that failure to maintain satisfactory capacity utilization rates or adapt to rapid technological changes could significantly decrease gross margins and harm business[172](index=172&type=chunk)[173](index=173&type=chunk)[191](index=191&type=chunk)[194](index=194&type=chunk) - Dependence on a small number of OEM customers (top five accounted for **33%** of net sales in Q1 2022) and EMS companies (**40%** of net sales in Q1 2022) creates concentration risk; a decline in sales or inability to collect payments from these customers would be materially adverse[181](index=181&type=chunk)[189](index=189&type=chunk) - A significant portion of revenue (**30%** in Q1 2022) is derived from products ultimately sold to the U.S. government, exposing the company to risks from changes in defense spending, regulations, and contract terminations[184](index=184&type=chunk)[185](index=185&type=chunk) - Product defects, whether design or manufacturing related, could lead to reduced revenue, customer dissatisfaction, and liability claims, particularly in industries with strict quality standards like automotive[196](index=196&type=chunk)[197](index=197&type=chunk) - Infringement of intellectual property rights or claims of infringement against the company could be costly, divert resources, and harm business, especially given limited protection in some foreign jurisdictions like China[198](index=198&type=chunk)[199](index=199&type=chunk) - Damage to manufacturing facilities from natural disasters or other events could disrupt operations, increase costs, and damage reputation, with insurance coverage potentially being inadequate[200](index=200&type=chunk)[201](index=201&type=chunk)[202](index=202&type=chunk) [Risks Related to our Indebtedness](index=38&type=section&id=Risks%20Related%20to%20our%20Indebtedness) This section outlines risks associated with the company's substantial debt, including liquidity and interest rate exposure - The company has substantial outstanding debt (**$928.2 million** net as of April 4, 2022), which could adversely impact liquidity, flexibility in obtaining additional financing, and ability to fulfill debt obligations[204](index=204&type=chunk) - High debt levels could require a substantial portion of cash flow for debt service, reducing funds for working capital, capital expenditures, and acquisitions, and could place the company at a competitive disadvantage[205](index=205&type=chunk) - Variable rate indebtedness (**$405.9 million** Term Loan, **$30.0 million** Asia ABL) exposes the company to interest rate risk, which will increase after the interest rate swap expires on June 1, 2022, potentially increasing debt service obligations[208](index=208&type=chunk)[209](index=209&type=chunk) - Inability to generate sufficient cash flows to service debt obligations could force the company to reduce investments, dispose of assets, seek additional capital (potentially dilutive), or restructure debt, with no assurance of success[211](index=211&type=chunk)[212](index=212&type=chunk)[214](index=214&type=chunk) [Regulatory Risks](index=39&type=section&id=Regulatory%20Risks) This section details regulatory risks, including power shortages, security clearances, and environmental compliance - Power shortages in China may necessitate temporary closures of China operations, impacting manufacturing, customer order fulfillment, and revenues[216](index=216&type=chunk) - Maintaining facility security clearance for U.S. government classified contracts requires compliance with NISPOM and a Special Security Agreement (SSA) due to non-U.S. equity ownership; loss of clearance would materially affect business[217](index=217&type=chunk)[218](index=218&type=chunk)[219](index=219&type=chunk) - Operations in China and Hong Kong are subject to risks from evolving and uncertain laws and regulations, inconsistent enforcement, and potential for new rules without sufficient notice, which could limit legal protections and impact operations[220](index=220&type=chunk) - Failure to comply with domestic and foreign environmental laws (e.g., Clean Air Act, RoHS, REACH, China's environmental regulations) could result in litigation, fines, permit revocations, production limits, or debarment from federal contracts[221](index=221&type=chunk)[222](index=222&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk)[226](index=226&type=chunk) - International sales are subject to anti-corruption (FCPA), trade, export control (ITAR, EAR), and economic sanctions laws. Non-compliance, even inadvertent or by third-party agents, could lead to criminal/civil fines, penalties, reputational harm, and loss of business[228](index=228&type=chunk)[229](index=229&type=chunk)[230](index=230&type=chunk)[231](index=231&type=chunk)[232](index=232&type=chunk) [Other Risks](index=42&type=section&id=Other%20Risks) This section covers other risks such as capital needs, cybersecurity, ERP system issues, and tax matters - The capital-intensive nature of the business means additional capital may be needed for investments, debt refinancing, and growth, but such capital may not be available on timely or acceptable terms[234](index=234&type=chunk)[235](index=235&type=chunk) - Outages, computer viruses, cyber-attacks, and security breaches could disrupt operations, lead to unauthorized access to sensitive data (intellectual property, customer information), and result in significant legal and financial exposure[236](index=236&type=chunk) - Issues during the upgrade of the enterprise resource planning (ERP) system could affect operating results and management effectiveness, potentially causing disruptions like temporary data loss or inability to process orders[237](index=237&type=chunk) - The ability to use net operating loss (NOL) carryforwards is subject to limitations under Section 382 of the Internal Revenue Code, and future share transfers could trigger an 'ownership change' further limiting NOL utilization[238](index=238&type=chunk)[239](index=239&type=chunk) - If future earnings decline, the company may need to increase its valuation allowance against deferred income tax assets, reducing results of operations. Unanticipated changes in tax rates or audits could also adversely affect financial condition[240](index=240&type=chunk)[241](index=241&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's common stock repurchase activities and the completion of its share repurchase program Common Stock Repurchases (Quarter Ended April 4, 2022, in thousands, except average price) | Period | Total Shares Purchased | Average Price Paid per Share | Maximum Value of Shares that May Yet be Purchased Under the Program | | :--------------------------------- | :--------------------- | :--------------------------- | :---------------------------------------------------------------- | | January 4, 2022 - January 31, 2022 | 237 | $13.44 | $32,187 | | February 1, 2022 - February 28, 2022 | 1,193 | $12.51 | $17,295 | | March 1, 2022 - April 4, 2022 | 943 | $12.86 | $5,184 | | Total for the quarter ended April 4, 2022 | 2,373 | $12.74 | | | Subsequent to April 4, 2022 (as of May 4, 2022) | 374 | | $0 (program completed) | [Item 6. Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including corporate documents and required certifications - Key exhibits include the Registrant's Certificate of Incorporation and Bylaws, CEO and CFO certifications (Sections 302 and 906 of Sarbanes-Oxley Act), and Inline XBRL documents for financial data[246](index=246&type=chunk) [Signatures](index=46&type=section&id=SIGNATURES) This section contains the duly authorized signatures of TTM Technologies, Inc.'s CEO and CFO for the report filing - The report is signed by Thomas T. Edman, President and Chief Executive Officer, and Todd B. Schull, Executive Vice President and Chief Financial Officer, on May 11, 2022[251](index=251&type=chunk)

TTM Technologies, Inc. (NASDAQ:TTMI) Q1 2022 Earnings Conference Call May 4, 2022 4:30 PM ET Company Participants Sameer Desai - Vice President, Corporate Development and IR Tom Edman - Chief Executive Officer Todd Schull - Chief Financial Officer Conference Call Participants Jim Ricchiuti - Needham & Company Mike Crawford - B. Riley Securities Travis Bucknall - Truist Securities Operator Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the TTM Technologies First Quarter 2022 Fina ...

TTM Technologies, Inc. Investor Presentation May, 2022 Inspiring Innovation Disclaimers 2 Forward-Looking Statements This communication may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to the future business outlook, events, and expected performance of TTM Technologies, Inc. ("TTM", "we" or the "Company"). The words "anticipate," "believe," "plan," "forecast," "foresee," "estimate," "project," "expect," "seek," ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended January 3, 2022 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 0-31285 TTM TECHNOLOGIES, INC. (Exact Name of Registrant as Specified in Its Charter) Delaware 91-1033443 (State or Other Jurisdiction of Incorporatio ...

TTM Technologies, Inc. Investor Presentation February, 2022 Inspiring Innovation Disclaimers 2 Forward-Looking Statements This communication may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to the future business outlook, events, and expected performance of TTM Technologies, Inc. ("TTM", "we" or the "Company"). The words "anticipate," "believe," "plan," "forecast," "foresee," "estimate," "project," "expect," "se ...

TTM Technologies, Inc. Q4'21 Earnings Results Presentation February 9th, 2022 Inspiring Innovation Disclaimers 2 Forward-Looking Statements This communication may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to the future business outlook, events, and expected performance of TTM Technologies, Inc. ("TTM", "we" or the "Company"). The words "anticipate," "believe," "plan," "forecast," "foresee," "estimate," "proje ...

Call Start: 16:30 January 1, 0000 5:28 PM ET TTM Technologies, Inc. (NASDAQ:TTMI) Q4 2021 Earnings Conference Call February 9, 2022, 4:30 PM ET Company Participants Tom Edman – Chief Executive Officer Todd Schull – Chief Financial Officer Sameer Desai – Vice President of Corporate Development and Investor Relations Conference Call Participants Srini Pajjuri – SMBC Nikko Securities America Jim Ricchiuti – Needham & Company Mike Crawford – B. Riley Securities Matt Sheerin – Stifel Christian Schwab – Craig-Hal ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Form 10-Q ☑ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 27, 2021 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 0-31285 TTM TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organizatio ...

| --- | --- | --- | --- | --- | --- | |-------|------------------------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | TTM Technologies, Inc. | | | | | | | | | | | | | | | | | | | | | Q3'21 Earnings Results | | | | | | | | | | | | | | Presentation | | | | | | | | | | | | October 27th, 2021 Inspiring Innovation Disclaimers Forward-Looking Statements 2 This communication may contain "f orward-looking statements" within the meaning of the Priv ate Securities Litigation Ref orm Act of 1995, in ...