TTM's Net Income Slides on Lower Sales | Print |  E-mail
Written by Mike Buetow   
Thursday, 06 February 2014 14:07

SANTA ANA, CA -- TTM Technologies reported fourth quarter sales of $366.1 million, down 4% year-over-year and up 8% sequentially.  Net income was $11.3 million, versus a net loss of $7.7 million in the third quarter and a profit of $13.7 million in 2012.

GAAP operating income was $29.3 million compared to an operating loss of $1.2 million sequentially, when the company took $14.1 million in severance and asset impairment charges.

Revenue was at the higher end of the company's guidance, with particular strength in the computing and cell phone end-markets. When divested plants are excluded, sales were up 2% from a year ago.

Gross margin was 19.2%, up 480 basis points sequentially, on better product mix.

Advanced Technology work, which includes HDI, rigid-flex, and flex assembly and substrates, accounted for 68% of TTM's Asia Pacific revenue in the quarter, up five percentage points sequentially, and overall capacity utilization in Asia Pacific was 90%, up from 76% last quarter.

TTM's North America plants operated at 59% utilization in the quarter, down from 62% sequentially. The Chippewa Falls, WI, site was an exception, operating near full capacity the past three quarters.

For fiscal 2013, the board fabricator reported net sales of $1.4 billion, up from $1.35 billion in 2012.

Networking/communications comprised 27% of total sales compared to 30% in the third quarter, but is expected to rebound to 31% of total sales in the first quarter. Computing, storage and peripherals represented 23% of sales, up from 19%, but is forecast to fall to 19% of sales in the first quarter due to seasonality for tablet and lower server and storage sales.

Cell phones increased to 24% of total sales, up 300 basis points, but will slip to 19% of sales in the first quarter. Aerospace and defense represented 14% of total sales, down 200 basis points but will grow to 16% of sales in the current period. Medical/industrial/instrumentation represented 8% in the fourth quarter and will rise to 10% in the first quarter due to inventory replenishment in the medical segment.

TTM's top five customers accounted for 47% of sales in the quarter and included, in alphabetical order, Amazon, Apple, Cisco, Huawei and Juniper. One customer -- suspected to be Apple -- accounted for 29% of sales during the quarter.

On a conference call with investors last night, new CEO Tom Erdman thanked his predecessor, Kent Alder, for putting in place the "critical initiatives and culture which will allow for our success."

He outlined as priorities in 2014 the end-markets of networking/communications, mobility, and aerospace and defense, as well as several internal initiatives including faster ramp cycle time and a new ERP system.

 

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