What changed in this filing

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Item 1. Financial Statements

2021-08-04 compared with 2021-05-05 · 249 added, 162 removed, 499 unchanged (45% of the section changed)

2 unchanged sentences

Consolidated Condensed Balance Sheets

As of March 29, 2021 and December 28, 2020

As of June 28, 2021 and December 28, 2020

(In thousands, except par value)

22 unchanged sentences

Common stock, $ 0.001 par value;

300,000 shares authorized, 107,113 and 106,770

shares issued and outstanding as of March 29, 2021 and December 28, 2020,

300,000 shares authorized;

108,145 and 106,770

shares issued as of June 28, 2021 and December 28, 2020, respectively;

106,770 shares outstanding as of June 28, 2021 and December 28, 2020, respectively

Treasury stock – common stock at cost;

361 shares as of June 28, 2021

Additional paid-in capital

6 unchanged sentences

Consolidated Condensed Statements of Operations

For the Quarters Ended March 29, 2021 and March 30, 2020

For the Quarter and Two Quarters Ended June 28, 2021 and June 29, 2020

Quarter Ended

Two Quarters Ended

(In thousands, except per share data)

11 unchanged sentences

Total other expense, net

Loss from continuing operations before income taxes

Income tax benefit (provision)

Net loss from continuing operations

Income from continuing operations before income taxes

Income tax (provision) benefit

Net income from continuing operations

Income from discontinued operations, net of income taxes

(Loss) earnings per share:

Basic loss per share from continuing operations

Earnings per share:

Basic earnings per share from continuing operations

Basic earnings per share from discontinued operations

Basic loss per share

Diluted loss per share from continuing operations

Basic earnings per share

Diluted earnings per share from continuing operations

Diluted earnings per share from discontinued operations

Diluted loss per share

Diluted earnings per share

See accompanying notes to consolidated condensed financial statements.

TTM TECHNOLOGIES, INC.

Consolidated Condensed Statements of Comprehensive Loss

For the Quarters Ended March 29, 2021 and March 30, 2020

Consolidated Condensed Statements of Comprehensive Income

For the Quarter and Two Quarters Ended June 28, 2021 and June 29, 2020

Quarter Ended

Two Quarters Ended

(In thousands)

1 unchanged sentence

Pension obligation adjustments, net

Derecognition of foreign currency translation adjustments

due to sale of Mobility business unit

Foreign currency translation adjustments, net

Net unrealized losses on cash flow hedges:

Unrealized loss on effective cash flow hedges during

Derecognition of unrealized losses on cash flow hedge

due to sale of Mobility business unit

Net unrealized gain (loss) on cash flow hedges:

Unrealized gain (loss) on effective cash flow hedges during

the period, net

1 unchanged sentence

Other comprehensive income (loss), net of tax

Comprehensive loss, net of tax

Comprehensive income, net of tax

See accompanying notes to consolidated condensed financial statements.

1 unchanged sentence

Consolidated Condensed Statements of Stockholders’ Equity

For the Quarters Ended March 29, 2021 and March 30, 2020

For the Two Quarters Ended June 28, 2021 and June 29, 2020

Treasury Stock

Comprehensive

11 unchanged sentences

warrant liabilities

Issuance of common stock from

warrant exercises

Issuance of common stock

from warrant exercises

Stock-based compensation

Balance, March 29, 2021

Other comprehensive income

Issuance of common stock

for restricted stock units

Repurchases of common stock

Issuance of stock

from warrant exercises

Stock-based compensation

Balance, June 28, 2021

Comprehensive

10 unchanged sentences

Balance, March 30, 2020

Other comprehensive loss

Issuance of common stock for

restricted stock units

Stock-based compensation

Balance, June 29, 2020

See accompanying notes to consolidated condensed financial statements.

1 unchanged sentence

Consolidated Condensed Statements of Cash Flows

For the Quarters Ended March 29, 2021 and March 30, 2020

Quarter Ended

March 29, 2021

March 30, 2020

For the Two Quarters Ended June 28, 2021 and June 29, 2020

Two Quarters Ended

June 28, 2021

June 29, 2020

(In thousands)

7 unchanged sentences

Stock-based compensation

Gain on sale of the Mobility business unit

Changes in operating assets and liabilities:

8 unchanged sentences

Cash flows from investing activities:

Refundable deposit related to sale of the Mobility business unit

Proceeds from sale of the Mobility business unit, net of cash disposed

Purchase of property, plant and equipment and other assets

5 unchanged sentences

Payment of debt issuance costs

Repurchases of common stock

Cash used to settle warrants

Net cash provided by financing activities

3 unchanged sentences

Cash and cash equivalents at end of period

Cash and cash equivalents in assets held for sale

Cash and cash equivalents as presented on the consolidated condensed balance sheet

Supplemental cash flow information:

7 unchanged sentences

Issuance of common stock for warrant settlement

Supplemental disclosure of noncash investing activities from discontinued operations:

Property, plant and equipment recorded in accounts payable

See accompanying notes to consolidated condensed financial statements.

15 unchanged sentences

GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s consolidated condensed financial statements and accompanying notes.

Due to the coronavirus (COVID-19) global pandemic, the global economy and financial markets have been disrupted and there is a significant amount of uncertainty about the length and severity of the consequences caused by the pandemic.

Due to the coronavirus (COVID-19) global pandemic, the global economy and financial markets have been volatile and there is a significant amount of uncertainty about the length and severity of the consequences caused by the on-going pandemic.

The Company has considered information available to it as of the date of issuance of these financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgments, or a revision to the carrying value of its assets or liabilities.

7 unchanged sentences

(GME) (collectively, the Mobility business unit).

For all periods presented in the consolidated condensed statements of operations, all sales, costs, expenses, income taxes and gain on sale attributable to the Mobility business unit have been aggregated under the caption “Income (loss) from discontinued operations, net of income taxes”.

For all periods presented in the consolidated condensed statements of operations, all sales, costs, expenses, income taxes and gain on sale attributable to the Mobility business unit have been aggregated under the caption “Income from discontinued operations, net of income taxes”.

Refer to Note 2, Discontinued Operations , for additional information.

5 unchanged sentences

PCB and RF and Specialty Components (RF&S Components).

In fiscal 2020, subsequent to the quarter ended March 30, 2020, RF&S Components was added as a reportable segment.

In fiscal 2020, subsequent to the quarter ended June 29, 2020, RF&S Components was added as a reportable segment.

As a result, the Company had three reportable segments as of December 28, 2020:

3 unchanged sentences

The Company closed the SH E-MS and SZ facilities at the end of 2020 and integrated the SH BPA facility into its PCB operations.

As of March 29, 2021, E-M Solutions no longer meets the criteria for segment reporting.

As of March 29, 2021, E-M Solutions no longer met the criteria for segment reporting.

As a result of the addition of the RF&S Components reportable segment and the restructuring of the E-M Solutions business unit, certain prior year amounts have been reclassified to conform to this new presentation.

Immaterial Correction of Error

During the quarter ended September 28, 2020, the Company paid for certain transaction costs related to the sale of the Mobility business unit totaling $ 11,043 .

These transaction costs should have been recorded as an expense earlier in the year and recorded in the period ending June 29, 2020, which would have reduced the gain on sale of Mobility business unit, during the quarter ended June 29, 2020.

The Company overstated both the income from discontinued operations, net of income taxes and net income by $ 11,043 , both basic earnings per share from discontinued operations and basic earnings per share of $ 0.10 and $ 0.11 in the quarter and two quarters ended June 29, 2020, respectively, and both diluted earnings per share from discontinued operations and diluted earnings per share of $ 0.10 in the quarter and two quarters ended June 29, 2020.

Management concluded that this error in the timing of recording the expense was not material to the consolidated condensed financial statements for the quarter and two quarters ended June 29, 2020.

Prior period amounts have been revised to correct the error.

Recently Adopted and Issued Accounting Standards

2 unchanged sentences

Simplifying the Accounting for Income Taxes , which is intended to simplify various aspects related to accounting for income taxes.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

5 unchanged sentences

The sale was completed on April 17, 2020 for a base purchase price of $ 550,000 , subject to customary purchase price adjustments.

The base purchase price does not include certain accounts receivable of the divested business, which were estimated to total approximately $ 95,000 .

Subsequently, the final purchase price was $ 569,246 after customary purchase price adjustments, which did not include approximately $ 83,000 accounts receivable of the divested business.

The base purchase price did not include certain accounts receivable of the divested business, which were estimated to total approximately $ 95,000 .

After the price adjustments, the final purchase price was $ 569,246 , which did not include approximately $ 83,000 accounts receivable of the divested business.

On April 18, 2020, the Company entered into a Transition Services Agreement (TSA) with the Purchaser pursuant to which the Purchaser is receiving certain services (the Services) to enable it to operate the Mobility business unit after the closing of the sale of the Mobility business unit.

6 unchanged sentences

As the sale of the Company’s Mobility business unit represents a strategic shift that will have a major effect on the Company’s operations and financial results, in accordance with the provisions of FASB authoritative guidance on the presentation of financial statements, Mobility business unit results are classified as discontinued operations in the consolidated condensed statements of operations for all periods presented.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

The following table summarizes the results of Mobility operations for the quarter ended March 30, 2020 prior to sale:

The following table summarizes the results of Mobility operations for the quarter and two quarters ended June 29, 2020 prior to sale:

Quarter Ended

(In thousands)

Two Quarters Ended

(In thousands, except per share data)

Cost of goods sold

8 unchanged sentences

Interest expense

Gain on sale of the Mobility business unit

Total other income, net

7 unchanged sentences

Diluted earnings per share

Depreciation expense related to the discontinued operations for the quarter ended March 30, 2020 was $ 18,265 .

Depreciation expense related to the discontinued operations for the quarter and two quarters ended June 29, 2020 was $ 3,117 and $ 21,382 , respectively.

During the quarter and two quarters ended June 29, 2020, the Company’s income tax expense related to the discontinued operations was impacted by a net discrete expense of $ 65,774 .

As a result of the sale of the Mobility business unit, the discrete income tax expense is related mainly to (i) China withholding tax related to gain on sale, (ii) U.S.

income tax related to Global Intangible Low Taxed Income (GILTI) inclusion net of IRC Section 250 deduction and foreign tax credits, and offset by (iii) release of U.S.

FIN 48 uncertain tax positions.

Proceeds from the sale of the Company’s Mobility business unit have been presented in the consolidated condensed statements of cash flows within net cash provided by investing activities from discontinued operations.

The following is a reconciliation of the final gain recorded for the sale of the Company’s Mobility business unit ( in thousands ):

Net proceeds from the sale of the Mobility business unit (1)

Mobility business unit assets:

Cash and cash equivalents

Restricted cash

Accounts receivable, net

Contract assets

Prepaid expenses and other current assets

Property, plant and equipment, net

Definite-lived intangibles, net

Deposits and other non-current assets

Total Mobility business unit assets

Mobility business unit liabilities:

Accounts payable

Accrued salaries, wages and benefits

Other current liabilities

Other long-term liabilities

Total Mobility business unit liabilities

Derecognition of foreign currency translation adjustments and unrealized losses

on cash flow hedges recorded in accumulated other comprehensive loss

Other transaction costs incurred as part of the sale of the Mobility business unit (2)

Gain on sale of the Mobility business unit before income taxes

Net proceeds from the sale of the Mobility business unit are net of customary purchase price adjustments.

Costs directly incurred as a result of the sale of the Company’s Mobility business unit, including bank fees, legal fees, professional fees, and other costs.

The Company leases some of its manufacturing and assembly plants, sales offices and equipment under non-cancellable operating leases that expire at various dates through 2049.

8 unchanged sentences

Quarter Ended

March 29, 2021

March 30, 2020

Two Quarters Ended

June 28, 2021

June 29, 2020

June 28, 2021

June 29, 2020

(In thousands)

2 unchanged sentences

Short-term lease cost

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

Supplemental cash flow information related to leases was as follows:

Quarter Ended

March 29, 2021

March 30, 2020

Two Quarters Ended

June 28, 2021

June 29, 2020

(In thousands)

4 unchanged sentences

Supplemental balance sheet information related to leases was as follows:

March 29, 2021

June 28, 2021

December 28, 2020

4 unchanged sentences

Total operating lease liabilities

March 29, 2021

June 28, 2021

December 28, 2020

7 unchanged sentences

Excludes $ 851 of legally binding minimum lease payments for leases signed but not yet commenced.

As of March 29, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations for long-term contracts was $ 12,850 .

As of June 28, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations for long-term contracts was $ 11,905 .

The Company expects to recognize revenue on approximately 82 % of the remaining performance obligations for the Company’s long-term contracts over the next twelve months .

Revenue from products and services transferred to customers over time and at a point in time accounted for 98 % and 2 %, respectively, of the Company’s revenue for the both the quarters ended March 29, 2021 and March 30, 2020.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

Revenue from products and services transferred to customers over time and at a point in time accounted for 98 % and 2 %, respectively, of the Company’s revenue for both quarter and two quarters ended June 28, 2021 and June 29, 2020.

The following tables represent a disaggregation of revenue by principal end markets with the reportable segments:

Quarter Ended March 29, 2021

Quarter Ended June 28, 2021

Quarter Ended June 29, 2020

RF&S Components

(In thousands)

3 unchanged sentences

Networking/Communications

Quarter Ended March 30, 2020

Two Quarters Ended June 28, 2021

Two Quarters Ended June 29, 2020

RF&S Components

(In thousands)

5 unchanged sentences

Other represents SH E-MS and SZ results.

In the current period, the Computing/Storage/Peripherals end market was renamed to Data Center Computing to better reflect the customer mix and growth prospects.

Beginning in the first quarter of 2021, the Computing/Storage/Peripherals end market was renamed to Data Center Computing to better reflect the customer mix and growth prospects.

There was no change to the customers included in this end market.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

(5) Composition of Certain Consolidated Condensed Financial Statement Captions

March 29, 2021

June 28, 2021

December 28, 2020

13 unchanged sentences

Income taxes payable

Warrant liabilities

Derivative liabilities

Operating lease

Restructuring

1 unchanged sentence

Deferred income taxes

Derivative liabilities

Defined benefit pension plan liability

As of March 29, 2021 and December 28, 2020, goodwill by reportable segment was as follows:

Derivative liabilities

As of June 28, 2021 and December 28, 2020, goodwill by reportable segment was as follows:

RF&S Components

(In thousands)

Balance as of December 28, 2020 and March 29, 2021

Balance as of December 28, 2020 and June 28, 2021

Accumulated impairment losses

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

(7) Definite-lived Intangibles

As of March 29, 2021 and December 28, 2020, the components of definite-lived intangibles were as follows:

As of June 28, 2021 and December 28, 2020, the components of definite-lived intangibles were as follows:

(In thousands)

March 29, 2021

June 28, 2021

Customer relationships

2 unchanged sentences

Definite-lived intangibles are amortized using the straight-line method of amortization over the useful life.

Amortization expense was $ 10,905 and $ 10,945 for the quarters ended March 29, 2021 and March 30, 2020, respectively.

For the quarters ended March 29, 2021 and March 30, 2020, $ 1,384 and $ 1,383 , respectively, of amortization expense is included in cost of goods sold.

Amortization expense was $ 10,425 and $ 10,945 for the quarters ended June 28, 2021 and June 29, 2020, respectively, and $ 21,330 and $ 21,890 for the two quarters ended June 28, 2021 and June 29, 2020, respectively.

For the quarter and two quarters ended June 28, 2021, $ 1,383 and $ 2,767 , respectively, of amortization expense is included in cost of goods sold.

For the quarter and two quarters ended June 29, 2020, $ 1,384 and $ 2,767 , respectively, of amortization expense is included in cost of goods sold.

Estimated aggregate amortization for definite-lived intangible assets for the next five years and thereafter is as follows:

2 unchanged sentences

(8) Long-term Debt and Letters of Credit

The following table summarizes the long-term debt of the Company as of March 29, 2021 and December 28, 2020:

The following table summarizes the long-term debt of the Company as of June 28, 2021 and December 28, 2020:

Interest Rate as of

March 29, 2021

June 28, 2021

Interest Rate as of

12 unchanged sentences

Long-term debt, less current maturities

The Company has twelve months from September 3, 2020 to reinvest the cash proceeds received from the sale of the Mobility business unit.

If the proceeds are not reinvested, the Company is required to use the proceeds to prepay the Term Loan.

The Company used a portion of the cash proceeds to repay $ 400,000 of the Term Loan during the year ended December 28, 2020 and plans to use

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

the remaining cash proceeds for reinvestment.

Pursuant to the Term Loan Credit Agreement, the Company may reinvest the cash proceeds received from the sale of the Mobility business unit for a period of twelve months commencing September 3, 2020.

If the proceeds are not reinvested during that time, the Company is required to use the proceeds to prepay the Term Loan.

The Company used a portion of the cash proceeds to

repay $ 400,000 of the Term Loan during the year ended December 28, 2020 and used the remaining cash proceeds for reinvestment pursuant to the Term Loan Credit Agreement .

Permitted investments, as defined in the Term Loan Credit Agreement, include extensions of trade credit in the ordinary course of business, investments in cash and cash equivalents, permitted acquisitions, investments in assets useful in the business of the Company and its restricted subsidiaries, investments in joint ventures and unrestricted subsidiaries among others .

9 unchanged sentences

Asset-Based Lending Agreements

As of March 29, 2021, letters of credit in the amount of $ 10,753 were outstanding under the U.S.

ABL and $ 11,721 were outstanding under the Asia ABL with various expiration dates through July 2021 .

As of June 28, 2021, letters of credit in the amount of $ 12,201 were outstanding under the U.S.

ABL and $ 3,475 were outstanding under the Asia Asset-Based Lending Credit Agreement (Asia ABL) with various expiration dates through July 2021 .

Available borrowing capacity under the U.S.

ABL and the Asia ABL was $ 139,247 and $ 108,279 , respectively, which considers letters of credit outstanding as of March 29, 2021.

ABL and the Asia ABL was $ 137,799 and $ 116,525 , respectively, which considers letters of credit outstanding as of June 28, 2021.

Debt Covenants

1 unchanged sentence

Under the occurrence of certain events, the U.S.

ABL and Asia Asset-Based Lending Credit Agreement (Asia ABL) (collectively, the ABL Revolving Loans), are subject to various financial covenants, including leverage and fixed charge coverage ratios.

ABL and Asia ABL (collectively, the ABL Revolving Loans), are subject to various financial covenants, including leverage and fixed charge coverage ratios.

Debt Issuance and Debt Discount

As of March 29 , 2021 and December 28, 2020, remaining unamortized debt discount and debt issuance costs for the Senior Notes due 2029, Term Loan Facility and Senior Notes due 2025 are as follows:

As of March 29, 2021

As of June 28 , 2021 and December 28, 2020, remaining unamortized debt discount and debt issuance costs for the Senior Notes due 2029, Term Loan Facility and Senior Notes due 2025 are as follows:

As of June 28, 2021

As of December 28, 2020

8 unchanged sentences

The above debt discount and debt issuance costs are recorded as a reduction of the debt and are amortized into interest expense using an effective interest rate over the duration of the debt.

Remaining unamortized debt issuance costs for the ABL Revolving Loans of $ 1,778 and $ 1,919 as of March 29 , 2021 and December 28, 2020, respectively, are included in other non-current assets and are amortized to interest expense over the duration of the ABL Revolving Loans using the straight-line method of amortization.

As of March 29 , 2021 , the remaining weighted average amortization period for all unamortized debt discount and debt issuance costs was 5.9 years.

Remaining unamortized debt issuance costs for the ABL Revolving Loans of $ 1,637 and $ 1,919 as of June 28 , 2021 and December 28, 2020, respectively, are included in other non-current assets and are amortized to interest expense over the duration of the ABL Revolving Loans using the straight-line method of amortization.

As of June 28 , 2021 , the remaining weighted average amortization period for all unamortized debt discount and debt issuance costs was 5.7 years.

Loss on Extinguishment of Debt

During the quarter ended March 29, 2021, the Company recognized losses of $ 15,217 associated with the premium paid on extinguishment of debt and the write-off of the remaining unamortized debt issuance costs as a result of the repayment of the remaining outstanding balance of the Senior Notes due 2025.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

During the two quarters ended June 28, 2021, the Company recognized losses of $ 15,217 associated with the premium paid on extinguishment of debt and the write-off of the remaining unamortized debt issuance costs as a result of the repayment of the remaining outstanding balance of the Senior Notes due 2025.

(9) Income Taxes

2 unchanged sentences

Additionally, no tax benefit was recorded on the losses incurred in certain foreign jurisdictions as a result of corresponding increases in the valuation allowances in these jurisdictions.

During the quarter ended March 29, 2021, the Company’s effective tax rate was impacted by a net discrete benefit of $ 383 .

This benefit resulted from the approval of the Company’s renewal application for High and New Tax Enterprise status for two of the Company’s manufacturing subsidiaries in China, including the impact on the respective Company’s deferred tax amounts, partially offset by tax expense on stock based compensation releases and the accrued interest expense on existing uncertain tax positions.

During the quarter and two quarters ended June 28, 2021, the Company’s effective tax rate was impacted by a net discrete benefit of $ 1,843 and $ 2,226 , respectively.

This is related mainly to (i) the release of uncertain tax positions due to the expiration of the statute of limitation in foreign jurisdictions, (ii) stock based compensation releases, (iii) the approval of the Company’s renewal application for High and New Tax Enterprise status for two of the Company’s manufacturing subsidiaries in China (including the impact on the respective Company’s deferred tax amounts), and (iv) accrued interest for existing uncertain tax positions.

The Company has various foreign subsidiaries formed or acquired to conduct or support its business outside the United States.

10 unchanged sentences

At inception, the Company designated the interest rate swap as a cash flow hedge and the fair value of the interest rate swap was zero .

As of March 29, 2021, the fair value of the interest rate swap was recorded as a liability in the amount of $ 12,579 and included as a component of other long-term liabilities.

As of June 28, 2021, the fair value of the interest rate swap was recorded as a liability in the amount of $ 10,000 and included as a component of other current liabilities.

The change in the fair value of the interest rate swap is recorded as a component of accumulated other comprehensive loss, net of tax.

No ineffectiveness was recognized for the quarters ended March 29, 2021 and March 30, 2020.

The interest rate swap increased interest expense by $ 2,740 and $ 1,175 for the quarters ended March 29, 2021 and March 30, 2020, respectively.

No ineffectiveness was recognized for the quarter and two quarters ended June 28, 2021 and June 29, 2020.

The interest rate swap increased interest expense by $ 2,763 and $ 2,342 for the quarters ended June 28, 2021 and June 29, 2020, respectively, and $ 5,503 and $ 3,517 for the two quarters ended June 28, 2021 and June 29, 2020, respectively.

Foreign Exchange Contracts

1 unchanged sentence

The Company’s foreign subsidiaries may at times purchase forward exchange contracts to manage their foreign currency risks in relation to certain purchases of machinery denominated in foreign currencies other than the Company’s functional currencies.

The notional amount of the foreign exchange contracts as of March 29, 2021 and December 28, 2020 was approximately $ 1,852 (Japanese Yen (JPY) 196.3 million) and $ 1,181 (JPY 125.0 million), respectively.

The notional amount of the foreign exchange contracts as of June 28, 2021 and December 28, 2020 was approximately $ 1,245 (Japanese Yen (JPY) 132.3 million) and $ 1,181 (JPY 125.0 million), respectively.

The Company has designated certain of these foreign exchange contracts as cash flow hedges.

Commodity Price Risk Management

The Company uses copper in the manufacturing of PCBs.

In order to reduce the impact of volatility of copper prices, the Company enters into commodity contracts.

As of June 28, 2021, the Company has commodity contracts with a notional quantity of 0.5 metric tonnes each for the periods (i) beginning June 29, 2021 and ending on September 23, 2021 , (ii) beginning September 28, 2021 and ending on December 30, 2021 , (iii) beginning January 4, 2022 and ending on March 31, 2022 , and (iv) beginning April 5, 2022 and ending on June 29, 2022 .

As of June 28, 2021, the fair value of the commodity contracts was recorded as an asset in the amount of $ 99 and included as a component of prepaid expenses and other current assets.

The changes in the fair value of these commodity contracts are recorded in cost of goods sold in the consolidated condensed statements of operations.

The commodity contracts decreased cost of goods sold by $ 99 for both the quarter and two quarters ended June 28, 2021.

These commodity contracts are not designated as accounting hedges.

The fair values of derivative instruments in the consolidated condensed balance sheets are as follows:

1 unchanged sentence

Balance Sheet Location

March 29, 2021

June 28, 2021

December 28, 2020

2 unchanged sentences

Interest rate swap

Other current liabilities

Interest rate swap

Other long-term liabilities

Foreign exchange contracts

Other current liabilities

Cash flow derivative instruments not designated as hedges:

1 unchanged sentence

Prepaid expenses and other current assets

Foreign exchange contracts

Other current liabilities

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

The following table provides information about the amounts recorded in accumulated other comprehensive loss related to derivatives designated as cash flow hedges, as well as the amounts recorded in each caption in the consolidated condensed statements of operations when derivative amounts are reclassified out of accumulated other comprehensive loss for the quarters ended March 29, 2021 and March 30, 2020:

Quarter Ended March 29, 2021

Quarter Ended March 30, 2020

Commodity contracts

Prepaid expenses and other current assets

Quarter Ended June 28, 2021

Quarter Ended June 29, 2020

Loss Recognized

6 unchanged sentences

Interest expense

The following table provides a summary of the activity associated with the designated cash flow hedges reflected in accumulated other comprehensive loss for the quarters ended March 29, 2021 and March 30, 2020:

Quarter Ended

Two Quarters Ended June 28, 2021

Two Quarters Ended June 29, 2020

Loss Recognized

Comprehensive Loss

Loss Recognized

Comprehensive Loss

(In thousands)

Cash flow hedge:

Interest rate swap

Interest expense

The following table provides a summary of the activity associated with the designated cash flow hedges reflected in accumulated other comprehensive loss for the two quarters ended June 28, 2021 and June 29, 2020:

Two Quarters Ended

(In thousands)

Beginning balance, net of tax

1 unchanged sentence

Reclassification to earnings

Derecognition of unrealized losses on cash flow hedge

due to sale of Mobility business unit

Ending balance, net of tax

1 unchanged sentence

(11) Accumulated Other Comprehensive Loss

The following provides a summary of the components of accumulated other comprehensive loss, net of tax, as of March 29, 2021 and December 28, 2020:

The following provides a summary of the components of accumulated other comprehensive loss, net of tax, as of June 28, 2021 and December 28, 2020:

(Losses) Gains

1 unchanged sentence

Ending balance as of December 28, 2020

Other comprehensive loss

Other comprehensive income (loss)

before reclassifications

1 unchanged sentence

other comprehensive loss

Other comprehensive (loss) income

Ending balance as of March 29, 2021

Other comprehensive income

Ending balance as of June 28, 2021

(12) Significant Customers and Concentration of Credit Risk

In the normal course of business, the Company extends credit to its customers.

Some customers to which the Company extends credit are located outside the United States.

Some customers to whom the Company extends credit are located outside the United States.

The Company performs ongoing credit evaluations of customers, does not require collateral, and considers the credit risk profile of the entity from which the receivable is due in further evaluating collection risk.

As of June 28, 2021, there was one customer that accounted for 10% of the Company’s accounts receivable.

There were no customers that accounted for 10% or more of accounts receivable as of December 28, 2020.

The Company’s customers include both OEMs and EMS companies.

1 unchanged sentence

While the Company’s customers include both OEM and EMS providers, the Company measures customer concentration based on OEM companies, as they are the ultimate end customers.

For the quarter ended March 29, 2021, other than one customer that accounted for approximately 13 % of the Company’s net sales, there were no other customers that accounted for 10% or more of net sales.

For the quarter ended March 30, 2020, there were no customers that accounted for 10% or more of net sales.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

There were no customers that accounted for 10% or more of net sales for the quarter ended June 28, 2021 and two quarters ended June 29, 2020.

For the two quarters ended June 28, 2021 and the quarter ended June 29, 2020, there was one customer that accounted for approximately 11 % of the Company’s net sales.

(13) Fair Value Measures

1 unchanged sentence

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability.

The carrying amount and estimated fair value of the Company’s financial instruments as of March 29, 2021 and December 28, 2020 were as follows:

March 29, 2021

The carrying amount and estimated fair value of the Company’s financial instruments as of June 28, 2021 and December 28, 2020 were as follows:

June 28, 2021

December 28, 2020

3 unchanged sentences

Derivative liabilities, non-current

Warrant liabilities, current

Senior Notes due March 2029

4 unchanged sentences

The values were adjusted to reflect non-performance risk of both the counterparty and the Company, as necessary.

The fair value of the warrant liabilities was valued using the Black-Scholes model with the following weighted-average assumptions:

expected term of 0.25 years, expected volatility of 35 %, risk-free interest rate of 0.032 %, and expected dividend yield of 0 %.

The inputs used in the warrant valuation are considered Level 3 inputs.

The fair value of the long-term debt was estimated based on quoted market prices or discounting the debt over its life using current market rates for similar debt as of March 29, 2021 and December 28, 2020, which are considered Level 2 inputs.

As of March 29, 2021 and December 28, 2020, the Company’s other financial instruments included cash and cash equivalents, accounts receivable, and accounts payable.

The fair value of the long-term debt was estimated based on quoted market prices or discounting the debt over its life using current market rates for similar debt as of June 28, 2021 and December 28, 2020, which are considered Level 2 inputs.

As of June 28 , 2021 and December 28 , 20 20 , the Company’s other financial instruments included cash and cash equivalents, accounts receivable, and accounts payable.

Due to short-term maturities, the carrying amount of these instruments approximates fair value.

The Company’s cash and cash equivalents as of March 29, 2021 consisted of $ 305,841 held in the U.S., with the remaining $ 233,807 held by foreign subsidiaries.

The Company’s cash and cash equivalents as of June 28 , 2021 consisted of $ 319,388 held in the U.S., with the remaining $ 238,903 held by foreign subsidiaries.

The majority of the Company’s non-financial assets and liabilities, which include goodwill, intangible assets, inventories, and property, plant and equipment, are not required to be carried at fair value on a recurring basis.

5 unchanged sentences

In the event of an adverse outcome, the ultimate potential loss could have a material adverse effect on the Company’s financial condition or results of operations in a particular period.

The Company has accrued amounts for its loss contingencies which are probable and estimable as of March 29, 2021 and December 28, 2020.

The Company has accrued amounts for its loss contingencies which are probable and estimable as of June 28, 2021 and December 28, 2020.

However, these amounts are not material to the consolidated condensed financial statements of the Company.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

(15) Loss Per Share

The following is a reconciliation of the numerator and denominator used to calculate basic earnings per share and diluted earnings per share from continuing operations for the quarters ended March 29, 2021 and March 30, 2020:

(15) Earnings Per Share

Quarter Ended

March 29, 2021

March 30, 2020

Two Quarters Ended

June 28, 2021

June 29, 2020

June 28, 2021

June 29, 2020

(In thousands, except per share amounts)

Net loss from continuing operations

Net income from continuing operations

Basic weighted average shares

1 unchanged sentence

restricted stock units and stock options

Dilutive effect of outstanding warrants

Diluted shares

Loss per share:

For the quarter ended March 29, 2021, potential shares of common stock, consisting of stock options to purchase approximately 60 shares of common stock at exercise prices ranging from $ 11.83 to $ 16.60 per share, 2,897 restricted stock units (RSUs), and 289 performance-based restricted stock units (PRUs) were not included in the computation of diluted earnings per share because the Company incurred a net loss and as a result, the impact would be anti-dilutive.

For the quarter ended March 30, 2020, potential shares of common stock, consisting of stock options to purchase approximately 100 shares of common stock at exercise prices ranging from $ 9.54 to $ 16.60 per share, 2,459 RSUs, and 216 PRUs were not included in the computation of diluted earnings per share because the Company incurred a net loss and, as a result, the impact would be anti-dilutive.

Outstanding warrants for the quarters ended March 29, 2021 and March 30, 2020, to purchase common stock were not included in the computation of dilutive earnings per share because the strike price of the warrants to purchase the Company’s common stock was greater than the average market price of common shares during the applicable quarter and because the Company incurred a net loss, and therefore, the effect would be anti-dilutive.

Earnings per share:

PRUs, RSUs, and stock options to purchase 1,452 and 802 shares of common stock for the quarter and two quarters ended June 28, 2021, respectively, and 1,162 and 750 shares of common stock for the quarter and two quarters ended June 29, 2020, respectively, were not included in the computation of diluted earnings per share.

The PRUs were not included in the computation of diluted earnings per share because the performance conditions had not been met at June 28, 2021 and June 29, 2020, and for RSUs and stock options, the options’ exercise prices or the total expected proceeds under the treasury stock method was greater than the average market price of common stock during the applicable quarter and two quarters and, as a result, the impact would be anti-dilutive.

Outstanding warrants for the quarter and two quarters ended June 29, 2020 to purchase common stock were not included in the computation of dilutive earnings per share because the strike price of the warrants to purchase the Company’s common stock was greater than the average market price of common stock during the applicable quarter, and therefore, the effect would be anti-dilutive.

(16) Stock-Based Compensation

1 unchanged sentence

Quarter Ended

Two Quarters Ended

(In thousands)

Cost of goods sold

4 unchanged sentences

Summary of Unrecognized Compensation Costs

The following is a summary of total unrecognized compensation costs as of March 29, 2021:

The following is a summary of total unrecognized compensation costs as of June 28, 2021:

Unrecognized Stock-Based Compensation Cost

3 unchanged sentences

Stock options

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

(17) Segment Information

The reportable segments shown below are the Company’s segments for which separate financial information is available and upon which operating results are evaluated by the chief operating decision maker to assess performance and to allocate resources.

In fiscal 2020, subsequent to the quarter ended March 30, 2020, RF&S Components was added as a reportable segment.

In fiscal 2020, subsequent to the quarter ended June 29, 2020, RF&S Components was added as a reportable segment.

As a result, the Company had three reportable segments as of December 28, 2020:

3 unchanged sentences

The Company closed the SH E-MS and SZ facilities at the end of 2020 and integrated the SH BPA facility into its PCB operations.

As of March 29, 2021, E-M Solutions no longer meets the criteria for segment reporting.

As of March 29, 2021, E-M Solutions no longer met the criteria for segment reporting.

3 unchanged sentences

Quarter Ended

March 29, 2021

March 30, 2020

Two Quarters Ended

June 28, 2021

June 29, 2020

June 28, 2021

June 29, 2020

(In thousands)

1 unchanged sentence

Total net sales

Operating Segment Loss:

Operating Segment Income:

RF&S Components

4 unchanged sentences

Total other expense

Loss before income taxes

March 29, 2021

Income before income taxes

June 28, 2021

December 28, 2020

5 unchanged sentences

Amortization of definite-lived intangibles primarily relates to the PCB and RF&S Components reportable segments.

For the quarters ended March 29, 2021 and March 30, 2020, $ 1,384 and $ 1,383 , respectively, of amortization expense is included in cost of goods sold.

For the quarter and two quarters ended June 28, 2021, $ 1,383 and $ 2,767 , respectively, of amortization expense is included in cost of goods sold.

For the quarter and two quarters ended June 29, 2020, $ 1,384 and $ 2,767 , respectively, of amortization expense is included in cost of goods sold.

The Corporate category primarily includes operating expenses that are not included in the segment operating performance measures.

Corporate consists primarily of corporate governance functions such as finance, accounting, information technology, facilities and human resources personnel, as well as global sales and marketing personnel, research and development costs, and acquisition and integration costs associated with acquisitions and divestitures.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

Corporate consists primarily of corporate governance functions such as finance, accounting, information technology and human resources personnel, as well as global sales and marketing personnel, research and development costs, and acquisition and integration costs associated with acquisitions and divestitures.

The Company markets and sells its products in approximately 45 countries.

2 unchanged sentences

Quarter Ended

March 29, 2021

March 30, 2020

Two Quarters Ended

June 28, 2021

June 29, 2020

June 28, 2021

June 29, 2020

(In thousands)

8 unchanged sentences

The Company closed the SH E-MS and SZ facilities at the end of 2020.

As of March 29, 2021, the Company has incurred approximately $ 19,272 of restructuring charges and $ 6,702 of accelerated depreciation expense since the April 29, 2020 announcement.

In connection with the restructuring of its E-M Solutions business unit and other global realignment restructuring efforts, the Company recognized employee separation, contract termination and other costs during the quarters ended March 29, 2021 and March 30, 2020.

As of June 28, 2021, the Company has incurred approximately $ 19,625 of restructuring charges and $ 6,702 of accelerated depreciation expense since the April 29, 2020 announcement.

Contract termination and other costs primarily represented plant closure costs.

The below table summarizes such restructuring costs by reportable segment, which are included as a component of general and administrative expenses in the consolidated condensed statements of operations, for the quarters ended March 29, 2021 and March 30, 2020:

Quarter Ended March 29, 2021

The table below summarizes such restructuring costs by reportable segment, which are included as a component of general and administrative expenses in the consolidated condensed statements of operations, for the quarter and two quarters ended June 28, 2021 and June 29, 2020:

Quarter Ended June 28, 2021

Two Quarters Ended June 28, 2021

(In thousands)

1 unchanged sentence

Corporate and Other (1)

Quarter Ended March 30, 2020

Quarter Ended June 29, 2020

Two Quarters Ended June 29, 2020

(In thousands)

2 unchanged sentences

Other represents SH E-MS and SZ results.

TTM TECHNOLOGIES, INC.

Notes to Consolidated Condensed Financial Statements—(Continued)

Accrued restructuring costs are included as a component of other current liabilities in the consolidated condensed balance sheet.

The below table shows the utilization of the accrued restructuring costs during the quarter ended March 29, 2021:

The table below shows the utilization of the accrued restructuring costs during the two quarters ended June 28, 2021:

(In thousands)

1 unchanged sentence

Charged to expense

Accrued as of March 29, 2021

Accrued as of June 28, 2021

(19) Share Repurchase Program

On February 3, 2021, the Company announced that its Board of Directors authorized and approved a share repurchase program.

Under the program, the Company may repurchase up to $ 100,000 in value of the Company’s outstanding shares of common stock from time to time through February 3, 2023 .

The Company may repurchase shares through open market purchases, privately-negotiated transactions, or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the Exchange Act) which sets certain restrictions on the method, timing, price and volume of open market stock repurchases.

In addition, the Company adopted a trading plan, which may be amended from time to time, in accordance with Rule 10b5-1 of the Exchange Act to facilitate certain purchases that may be effected under the share repurchase program.

The timing, manner, price and amount of any repurchases will be determined at the Company’s discretion, and the share repurchase program may be suspended, terminated or modified at any time for any reason.

The repurchase program does not obligate the Company to acquire any specific number of shares.

During the quarter and two quarters ended June 28, 2021, the Company repurchased 411 shares of common stock for a total cost of $ 6,145 .

As of June 28, 2021, the remaining amount available to be repurchased under the Company’s share repurchase program was $ 93,855 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements