TTM TECHNOLOGIES INC 10-Q

Item 1. Financial Statements (unaudited) TTM TECHNOLOGIES, INC. Consolidated Condensed Balance Sheets As of June 28, 2021 and December 28, 2020 As of June 28, December 28, 2021 2020 (Unaudited) (In thousands, except par value) ASSETS Current assets: Cash and cash equivalents $ 558,291 $ 451,565 Accounts receivable, net 378,762 381,105 Contract assets 300,697 273,256 Inventories 126,355 115,651 Prepaid expenses and other current assets 40,410 27,181 Total current assets 1,404,515 1,248,758 Property, plant and equipment, net 650,764 650,435 Operating lease right-of-use assets 20,134 24,340 Goodwill 637,324 637,324 Definite-lived intangibles, net 259,977 281,307 Deposits and other non-current assets 53,022 53,780 Total assets $ 3,025,736 $ 2,895,944 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 364,005 $ 327,102 Contract liabilities 2,066 4,254 Accrued salaries, wages and benefits 87,764 97,268 Other current liabilities 100,915 89,422 Total current liabilities 554,750 518,046 Long-term debt, net of discount and issuance costs 926,523 842,853 Operating lease liabilities 14,836 17,211 Other long-term liabilities 59,256 73,825 Total long-term liabilities 1,000,615 933,889 Commitments and contingencies (Note 14) Equity: Common stock, $ 0.001 par value; 300,000 shares authorized; 108,145 and 106,770 shares issued as of June 28, 2021 and December 28, 2020, respectively; 107,784 and 106,770 shares outstanding as of June 28, 2021 and December 28, 2020, respectively 108 107 Treasury stock – common stock at cost; 361 shares as of June 28, 2021 ( 5,400 ) — Additional paid-in capital 833,439 830,971 Retained earnings 676,913 651,844 Accumulated other comprehensive loss ( 34,689 ) ( 38,913 ) Total stockholders’ equity 1,470,371 1,444,009 Total liabilities and stockholders' equity $ 3,025,736 $ 2,895,944 See accompanying notes to consolidated condensed financial statements. 3 TTM TECHNOLOGIES, INC. Consolidated Condensed Statements of Operations For the Quarter and Two Quarters Ended June 28, 2021 and June 29, 2020 Quarter Ended Two Quarters Ended June 28, June 29, June 28, June 29, 2021 2020 2021 2020 (Unaudited) (In thousands, except per share data) Net sales $ 567,383 $ 570,298 $ 1,093,815 $ 1,067,944 Cost of goods sold 467,473 469,868 912,305 886,172 Gross profit 99,910 100,430 181,510 181,772 Operating expenses: Selling and marketing 14,605 15,969 30,887 32,138 General and administrative 31,193 46,723 62,720 81,390 Research and development 4,182 5,181 8,652 9,943 Amortization of definite-lived intangibles 9,042 9,561 18,563 19,123 Total operating expenses 59,022 77,434 120,822 142,594 Operating income 40,888 22,996 60,688 39,178 Other (expense) income: Interest expense ( 11,079 ) ( 18,572 ) ( 22,468 ) ( 38,353 ) Loss on extinguishment of debt — — ( 15,217 ) — Other, net 306 455 2,813 2,957 Total other expense, net ( 10,773 ) ( 18,117 ) ( 34,872 ) ( 35,396 ) Income from continuing operations before income taxes 30,115 4,879 25,816 3,782 Income tax (provision) benefit ( 1,854 ) 4,467 ( 747 ) 2,344 Net income from continuing operations 28,261 9,346 25,069 6,126 Income from discontinued operations, net of income taxes — 172,421 — 174,467 Net income $ 28,261 $ 181,767 $ 25,069 $ 180,593 Earnings per share: Basic earnings per share from continuing operations $ 0.26 $ 0.09 $ 0.23 $ 0.06 Basic earnings per share from discontinued operations — 1.62 — 1.64 Basic earnings per share $ 0.26 $ 1.71 $ 0.23 $ 1.70 Diluted earnings per share from continuing operations $ 0.26 $ 0.09 $ 0.23 $ 0.06 Diluted earnings per share from discontinued operations — 1.60 — 1.62 Diluted earnings per share $ 0.26 $ 1.69 $ 0.23 $ 1.68 See accompanying notes to consolidated condensed financial statements. 4 TTM TECHNOLOGIES, INC. 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 June 28, June 29, June 28, June 29, 2021 2020 2021 2020 (Unaudited) (In thousands) Net income $ 28,261 $ 181,767 $ 25,069 $ 180,593 Other comprehensive income (loss), net of tax: Pension obligation adjustments, net 29 ( 6 ) 29 21 Derecognition of foreign currency translation adjustments due to sale of Mobility business unit — ( 27,341 ) — ( 27,341 ) Foreign currency translation adjustments, net 417 96 414 ( 271 ) Derecognition of unrealized losses on cash flow hedge due to sale of Mobility business unit — 384 — 384 Net unrealized gain (loss) on cash flow hedges: Unrealized gain (loss) on effective cash flow hedges during the period, net 60 ( 1,994 ) ( 203 ) ( 8,012 ) Loss realized in the statement of operations, net 1,932 1,769 3,984 2,629 Net 1,992 ( 225 ) 3,781 ( 5,383 ) Other comprehensive income (loss), net of tax 2,438 ( 27,092 ) 4,224 ( 32,590 ) Comprehensive income, net of tax $ 30,699 $ 154,675 $ 29,293 $ 148,003 See accompanying notes to consolidated condensed financial statements. 5 TTM TECHNOLOGIES, INC. Consolidated Condensed Statements of Stockholders’ Equity For the Two Quarters Ended June 28, 2021 and June 29, 2020 Common Stock Treasury Stock Additional Paid-In Retained Accumulated Other Comprehensive Total Stockholders' Shares Amount Shares Amount Capital Earnings Loss Equity (Unaudited) (In thousands) Balance, December 28, 2020 106,770 $ 107 — $ — $ 830,971 $ 651,844 $ ( 38,913 ) $ 1,444,009 Net loss — — — — — ( 3,192 ) — ( 3,192 ) Other comprehensive income — — — — — — 1,786 1,786 Issuance of common stock for performance-based restricted stock units 135 — — — — — — — Issuance of common stock for restricted stock units 203 — — — — — — — Fair value of warrants reclassified to warrant liabilities — — — — ( 4,345 ) — — ( 4,345 ) Issuance of common stock from warrant exercises 5 — — — — — — — Stock-based compensation — — — — 4,209 — — 4,209 Balance, March 29, 2021 107,113 $ 107 — $ — $ 830,835 $ 648,652 $ ( 37,127 ) $ 1,442,467 Net income — — — — — 28,261 — 28,261 Other comprehensive income — — — — — — 2,438 2,438 Issuance of common stock for restricted stock units 947 1 — — ( 1 ) — — — Repurchases of common stock — — ( 411 ) ( 6,145 ) — — — ( 6,145 ) Issuance of stock from warrant exercises 86 — 50 745 ( 745 ) — — — Stock-based compensation — — — — 3,350 — — 3,350 Balance, June 28, 2021 108,145 $ 108 ( 361 ) $ ( 5,400 ) $ 833,439 $ 676,913 $ ( 34,689 ) $ 1,470,371 Common Stock Additional Paid-In Retained Accumulated Other Comprehensive Total Stockholders' Shares Amount Capital Earnings Loss Equity (Unaudited) (In thousands) Balance, December 30, 2019 105,510 $ 106 $ 814,708 $ 474,309 $ ( 10,086 ) $ 1,279,037 Net loss — — — ( 1,174 ) — ( 1,174 ) Other comprehensive loss — — — — ( 5,498 ) ( 5,498 ) Issuance of common stock for performance-based restricted stock units 187 — — — — — Issuance of common stock for restricted stock units 520 — — — — — Stock-based compensation — — 4,835 — — 4,835 Balance, March 30, 2020 106,217 $ 106 $ 819,543 $ 473,135 $ ( 15,584 ) $ 1,277,200 Net income — — — 181,767 — 181,767 Other comprehensive loss — — — — ( 27,092 ) ( 27,092 ) Issuance of common stock for restricted stock units 484 1 ( 1 ) — — — Stock-based compensation — — 2,647 — — 2,647 Balance, June 29, 2020 106,701 $ 107 $ 822,189 $ 654,902 $ ( 42,676 ) $ 1,434,522 See accompanying notes to consolidated condensed financial statements. 6 TTM TECHNOLOGIES, INC. Consolidated Condensed Statements of Cash Flows For the Two Quarters Ended June 28, 2021 and June 29, 2020 Two Quarters Ended June 28, 2021 June 29, 2020 (Unaudited) (In thousands) Cash flows from operating activities: Net income $ 25,069 $ 180,593 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation of property, plant and equipment 42,717 71,503 Amortization of definite-lived intangible assets 21,330 22,699 Amortization of debt discount and issuance costs 1,074 7,157 Loss on extinguishment of debt 15,217 — Deferred income taxes 1,407 34,206 Stock-based compensation 7,559 7,482 Gain on sale of the Mobility business unit — ( 237,820 ) Other ( 1,514 ) 157 Changes in operating assets and liabilities: Accounts receivable, net 2,343 89,323 Contract assets ( 27,441 ) ( 39,118 ) Inventories ( 10,704 ) ( 6,470 ) Prepaid expenses and other current assets ( 13,284 ) ( 14,574 ) Accounts payable 45,344 24,183 Contract liabilities ( 2,188 ) ( 698 ) Accrued salaries, wages and benefits ( 9,504 ) ( 9,904 ) Other current liabilities 629 18,190 Net cash provided by operating activities 98,054 146,909 Cash flows from investing activities: Proceeds from sale of the Mobility business unit, net of cash disposed — 202,752 Purchase of property, plant and equipment and other assets ( 44,636 ) ( 54,899 ) Proceeds from sale of property, plant and equipment and other assets 943 78 Net cash (used in) provided by investing activities ( 43,693 ) 147,931 Cash flows from financing activities: Proceeds from long-term debt borrowing 500,000 — Repayment of long-term debt borrowings ( 425,838 ) — Payment of debt issuance costs ( 5,776 ) — Repurchases of common stock ( 6,145 ) — Cash used to settle warrants ( 3,146 ) — Other ( 7,062 ) — Net cash provided by financing activities 52,033 — Effect of foreign currency exchange rates on cash and cash equivalents 332 ( 326 ) Net increase in cash and cash equivalents 106,726 294,514 Cash and cash equivalents at beginning of period 451,565 400,154 Cash and cash equivalents at end of period $ 558,291 $ 694,668 Supplemental cash flow information: Cash paid, net for interest $ 21,077 $ 32,814 Cash paid, net for income taxes 2,826 11,678 Net cash provided by operating activities from discontinued operations — 39,462 Net cash provided by investing activities from discontinued operations — 193,302 Net cash used in financing activities from discontinued operations — — Supplemental disclosure of noncash investing and financing activities: Property, plant and equipment recorded in accounts payable $ 27,625 $ 38,223 Issuance of common stock for warrant settlement 2,095 — See accompanying notes to consolidated condensed financial statements. 7 TTM TECHNOLOGIES, INC. Notes to Consolidated Condensed Financial Statements (Unaudited) (Dollars and shares in thousands, except per share data) (1) Nature of Operations and Basis of Presentation TTM Technologies, Inc. (the Company or TTM) is a leading global printed circuit board (PCB) manufacturer, focusing on quick-turn and volume production of technologically advanced PCBs and backplane assemblies as well as a global designer and manufacturer of high-frequency radio frequency (RF) and microwave components and assemblies. The Company provides time-to-market and volume production of advanced technology products and offers a one-stop design, engineering and manufacturing solution to customers. This one-stop design, engineering and manufacturing solution allows the Company to align technology developments with the diverse needs of the Company’s customers and to enable them to reduce the time required to develop new products and bring them to market. The Company serves a diversified customer base in various markets throughout the world, including aerospace and defense, data center computing, automotive components, medical, industrial and instrumentation related products, as well as networking/communications infrastructure products. The Company’s customers include both original equipment manufacturers (OEMs) and electronic manufacturing services (EMS) providers. The accompanying consolidated condensed financial statements have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) have been condensed or omitted pursuant to such rules and regulations. It is suggested that these consolidated condensed financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s most recent Annual Report on Form 10-K. The preparation of financial statements in accordance with U.S. 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 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. Actual results could differ materially from those estimates. The Company uses a 13-week fiscal quarter accounting period with the fourth quarter ending on the Monday nearest December 31. On January 19, 2020, the Company entered into a definitive equity interests purchase agreement with AKMMeadville Electronics (Xiamen) Co., Ltd (the Purchaser) for the sale of the Company’s following subsidiaries, which was completed on April 17, 2020: Shanghai Kaiser Electronics Co., Ltd. (SKE), Shanghai Meadville Electronics Co., Ltd. (SME), Shanghai Meadville Science & Technology Co., Ltd. (SP) and Guangzhou Meadville Electronics Co., Ltd. (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 from discontinued operations, net of income taxes”. Refer to Note 2, Discontinued Operations , for additional information. Unless otherwise noted, amounts and disclosures throughout these notes to consolidated condensed financial statements relate to continuing operations. These consolidated condensed financial statements reflect all adjustments (consisting only of normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the financial position, the results of operations and cash flows of the Company for the periods presented. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. Reclassifications The Company currently has two reportable segments: PCB and RF and Specialty Components (RF&S Components). 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: PCB, RF&S Components, and E-M Solutions. On April 29, 2020, the Company announced the restructuring of its E-M Solutions business unit. In prior periods, the Company’s E-M Solutions business unit consisted of three Chinese manufacturing facilities with two being in Shanghai (SH BPA and SH E-MS) and one in Shenzhen (SZ). 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 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. 8 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 Recently Adopted Accounting Standards In December 2019, the Financial Accounting Standards Board (FASB) issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. The guidance is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. The Company adopted this ASU as of December 29, 2020 and it did not have a material impact on its consolidated condensed financial statements and related disclosures. (2) Discontinued Operations On January 19, 2020, the Company entered into a definitive equity interests purchase agreement for the sale of the Company’s Mobility business unit. 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 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. The Services include finance and accounting, human resources, legal and compliance, sales, information technology, and other corporate support services. Under the TSA, the Services are being provided at cost for a period of up to 24 months. In addition, the Company entered into a Manufacturing Supply Agreement with the Purchaser pursuant to which the Purchaser will supply products to a few customers of the Company. There was no material impact on the Company’s consolidated condensed financial statements. Further, on June 29, 2020, the Company entered into a Sales Force Agreement with the Purchaser pursuant to which the Company’s sales representatives assist the Purchaser in selling PCBs manufactured by the Purchaser to certain customers for a commission for a period up to April 17, 2021. There was no material impact on the Company’s consolidated condensed financial statements. 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. 9 The following table summarizes the results of Mobility operations for the quarter and two quarters ended June 29, 2020 prior to sale: Quarter Ended Two Quarters Ended June 29, June 29, 2020 2020 (In thousands, except per share data) Net sales $ 30,777 $ 143,951 Cost of goods sold 28,375 136,800 Gross profit 2,402 7,151 Operating expenses: Selling and marketing 285 1,461 General and administrative 1,007 2,317 Research and development — 147 Amortization of definite-lived intangibles 134 809 Total operating expenses 1,426 4,734 Operating income 976 2,417 Other (expense) income: Interest expense — ( 223 ) Gain on sale of the Mobility business unit 237,820 237,820 Other, net ( 411 ) 1,160 Total other income, net 237,409 238,757 Income from discontinued operations before income taxes 238,385 241,174 Income tax provision ( 65,964 ) ( 66,707 ) Income from discontinued operations, net of income taxes $ 172,421 $ 174,467 Earnings per share from discontinued operations: Basic earnings per share $ 1.62 $ 1.64 Diluted earnings per share $ 1.60 $ 1.62 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. 10 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) $ 569,246 Mobility business unit assets: Cash and cash equivalents 12,513 Restricted cash 35,412 Accounts receivable, net 12 Contract assets 40,072 Inventories 4,988 Prepaid expenses and other current assets 4,593 Property, plant and equipment, net 328,648 Goodwill 68,267 Definite-lived intangibles, net 5,520 Deposits and other non-current assets 6,291 Total Mobility business unit assets 506,316 Mobility business unit liabilities: Accounts payable 142,636 Accrued salaries, wages and benefits 9,392 Other current liabilities 8,890 Other long-term liabilities 303 Total Mobility business unit liabilities 161,221 Derecognition of foreign currency translation adjustments and unrealized losses on cash flow hedges recorded in accumulated other comprehensive loss 26,957 Other transaction costs incurred as part of the sale of the Mobility business unit (2) 13,855 Gain on sale of the Mobility business unit before income taxes $ 237,253 (1) Net proceeds from the sale of the Mobility business unit are net of customary purchase price adjustments. (2) 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. (3) Leases 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. The majority of the Company’s lease arrangements are comprised of fixed payments and certain leases consist of variable payments based on equipment usage. These variable payments are not included in the measurement of the right-of-use (ROU) asset or lease liability due to uncertainty of the payment amount and are recorded as lease expense in the period incurred. Certain leases contain renewal provisions at the Company’s option. Most of the leases require the Company to pay for certain other costs such as property taxes and maintenance. Certain leases also contain rent escalation clauses (step rents) that require additional rental amounts in the later years of the term. Rent expense for leases with step rents is recognized on a straight-line basis over the minimum lease term. The lease agreements do not contain any material residual value guarantees or material restrictive covenants. The components of lease expense were as follows: Quarter Ended Two Quarters Ended June 28, 2021 June 29, 2020 June 28, 2021 June 29, 2020 (In thousands) Operating lease cost $ 1,924 $ 2,227 $ 4,132 $ 4,708 Variable lease cost 140 137 374 243 Short-term lease cost 55 169 109 398 11 Supplemental cash flow information related to leases was as follows: Two Quarters Ended June 28, 2021 June 29, 2020 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 4,104 $ 4,342 Right-of-use assets obtained in exchange for new lease obligations: Operating leases 802 3,205 Supplemental balance sheet information related to leases was as follows: As of June 28, 2021 December 28, 2020 (In thousands) Operating lease right-of-use assets $ 20,134 $ 24,340 Other current liabilities 6,190 8,144 Operating lease liabilities 14,836 17,211 Total operating lease liabilities $ 21,026 $ 25,355 As of June 28, 2021 December 28, 2020 Weighted average remaining lease term 4.2 years 4.2 years Weighted average discount rate 3.25 % 3.31 % Maturities of operating lease liabilities were as follows (1) : (In thousands) Less than one year $ 6,750 1 - 2 years 5,081 2 - 3 years 4,180 3 - 4 years 3,157 4 - 5 years 1,888 Thereafter 1,477 Total lease payments 22,533 Less imputed interest ( 1,507 ) Total $ 21,026 (1) Excludes $ 851 of legally binding minimum lease payments for leases signed but not yet commenced. (4) Revenues 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 both quarter and two quarters ended June 28, 2021 and June 29, 2020. 12 The following tables represent a disaggregation of revenue by principal end markets with the reportable segments: Quarter Ended June 28, 2021 Quarter Ended June 29, 2020 PCB RF&S Components Total PCB RF&S Components Other (1) Total End Markets (In thousands) Aerospace and Defense $ 185,152 $ 6 $ 185,158 $ 188,910 $ 9 $ 20 $ 188,939 Automotive 102,893 — 102,893 57,998 — 11,583 69,581 Data Center Computing (2) 82,230 24 82,254 71,541 273 36 71,850 Medical/Industrial/Instrumentation 104,012 1,067 105,079 115,813 800 2,988 119,601 Networking/Communications 75,728 11,950 87,678 95,416 10,560 7,446 113,422 Other 3,465 856 4,321 7,165 449 ( 709 ) 6,905 Total $ 553,480 $ 13,903 $ 567,383 $ 536,843 $ 12,091 $ 21,364 $ 570,298 Two Quarters Ended June 28, 2021 Two Quarters Ended June 29, 2020 PCB RF&S Components Other (1) Total PCB RF&S Components Other (1) Total End Markets (In thousands) Aerospace and Defense $ 371,691 12 $ — $ 371,703 $ 373,324 $ 9 $ 20 $ 373,353 Automotive 194,685 — 3,642 198,327 119,856 — 18,596 138,452 Cellular Phone — — — — 1,296 — — 1,296 Data Center Computing (2) 153,989 456 — 154,445 129,655 476 90 130,221 Medical/Industrial/Instrumentation 194,782 2,148 25 196,955 206,281 1,594 6,308 214,183 Networking/Communications 142,666 22,603 1 165,270 165,849 18,627 11,641 196,117 Other 6,153 1,374 ( 412 ) 7,115 14,584 826 ( 1,088 ) 14,322 Total $ 1,063,966 $ 26,593 $ 3,256 $ 1,093,815 $ 1,010,845 $ 21,532 $ 35,567 $ 1,067,944 (1) Other represents SH E-MS and SZ results. (2) 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. 13 (5) Composition of Certain Consolidated Condensed Financial Statement Captions As of June 28, 2021 December 28, 2020 (In thousands) Inventories: Raw materials $ 113,546 $ 103,890 Work-in-process 9,265 7,841 Finished goods 3,544 3,920 $ 126,355 $ 115,651 Property, plant and equipment, net: Land and land use rights $ 62,061 $ 61,781 Buildings and improvements 404,802 398,540 Machinery and equipment 855,892 832,723 Furniture and fixtures and other 10,218 10,304 Construction-in-progress 36,177 33,191 1,369,150 1,336,539 Less: Accumulated depreciation ( 718,386 ) ( 686,104 ) $ 650,764 $ 650,435 Other current liabilities: Sales returns and allowances $ 13,623 $ 13,015 Income taxes payable 10,108 2,428 Derivative liabilities 10,000 — Interest 7,996 7,157 Operating lease 6,190 8,144 Restructuring 97 7,382 Other 52,901 51,296 $ 100,915 $ 89,422 Other long-term liabilities: Deferred income taxes $ 24,043 $ 23,704 Defined benefit pension plan liability 9,313 9,986 Derivative liabilities — 14,968 Other 25,900 25,167 $ 59,256 $ 73,825 (6) Goodwill As of June 28, 2021 and December 28, 2020, goodwill by reportable segment was as follows: PCB RF&S Components Total (In thousands) Balance as of December 28, 2020 and June 28, 2021 Goodwill $ 700,724 $ 177,200 $ 877,924 Accumulated impairment losses ( 171,400 ) ( 69,200 ) ( 240,600 ) $ 529,324 $ 108,000 $ 637,324 14 (7) Definite-lived Intangibles As of June 28, 2021 and December 28, 2020, the components of definite-lived intangibles were as follows: Gross Amount Accumulated Amortization Net Carrying Amount Weighted Average Amortization Period (In thousands) (In years) June 28, 2021 Customer relationships $ 397,500 $ ( 168,705 ) $ 228,795 10.9 Technology 47,650 ( 16,468 ) 31,182 9.5 $ 445,150 $ ( 185,173 ) $ 259,977 December 28, 2020 Customer relationships $ 397,500 $ ( 150,142 ) $ 247,358 10.9 Technology 47,650 ( 13,701 ) 33,949 9.5 $ 445,150 $ ( 163,843 ) $ 281,307 Definite-lived intangibles are amortized using the straight-line method of amortization over the useful life. 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: (In thousands) Remaining 2021 $ 19,849 2022 38,631 2023 36,713 2024 29,713 2025 25,397 Thereafter 109,674 $ 259,977 (8) Long-term Debt and Letters of Credit The following table summarizes the long-term debt of the Company as of June 28, 2021 and December 28, 2020: Interest Rate as of June 28, 2021 Principal Outstanding as of June 28, 2021 Interest Rate as of December 28, 2020 Principal Outstanding as of December 28, 2020 (In thousands) Senior Notes due March 2029 4.00 % $ 500,000 — % $ — Term Loan due September 2024 2.60 405,879 2.65 405,879 Senior Notes due October 2025 — — 5.63 375,000 U.S. ABL Revolving Loan due June 2024 — — 1.40 40,000 Asia ABL Revolving Loan due June 2024 1.50 30,000 1.55 30,000 935,879 850,879 Less: Long-term debt unamortized discount ( 712 ) ( 814 ) Long-term debt unamortized debt issuance costs ( 8,644 ) ( 7,212 ) 926,523 842,853 Less: current maturities — — Long-term debt, less current maturities $ 926,523 $ 842,853 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 15 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 . Senior Notes due 2029 On March 10, 2021, the Company issued $ 500,000 of Senior Notes due 2029, which are included in long-term debt and bear interest at a rate of 4.0 % per annum. Interest is payable semiannually in arrears on March 1 and September 1 of each year beginning September 1, 2021. The Senior Notes due 2029 will mature on March 1, 2029 . The Company used a portion of the net proceeds from the issuance of the Senior Notes due 2029 during the quarter ended March 29, 2021 to: (i) fund the early retirement of $ 375,000 Senior Notes due 2025, (ii) fund the repayment of $ 40,000 outstanding under the U.S. Asset-Based Lending Credit Agreement (U.S. ABL) Revolving credit facility (but not terminate the commitments thereunder), and (iii) pay related premiums, fees and expenses. The Company intends to use the remaining net proceeds for general corporate purposes. Asset-Based Lending Agreements 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 $ 137,799 and $ 116,525 , respectively, which considers letters of credit outstanding as of June 28, 2021. Debt Covenants Borrowings under the Term Loan and Senior Notes due 2029 are subject to certain affirmative and negative covenants, including limitations on indebtedness, corporate transactions, investments, dispositions, and share payments. Under the occurrence of certain events, the U.S. 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 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 Debt Issuance Costs Debt Discount Effective Interest Rate Debt Issuance Costs Debt Discount Effective Interest Rate (In thousands, except interest rates) Senior Notes due March 2029 $ 6,289 $ — 4.19 % $ — $ — — % Term Loan due September 2024 2,355 712 4.66 2,695 814 4.66 Senior Notes due October 2025 — — — 4,517 — 5.92 $ 8,644 $ 712 $ 7,212 $ 814 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 $ 1,637 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 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. 16 (9) Income Taxes The Company’s effective tax rate is impacted by tax rates in China and Hong Kong, the U.S. federal income tax rate, apportioned state income tax rates, generation of credits and deductions available to the Company as well as changes in valuation allowances and certain non-deductible items. 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 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. The Company expects its earnings attributable to most foreign subsidiaries may be repatriated back to the U.S. and so a deferred tax liability has been recorded for foreign withholding and the estimated federal/state tax impact. For those other companies with earnings currently being reinvested outside of the U.S., no deferred tax liabilities on undistributed earnings are recorded. (10) Financial Instruments Derivatives Interest Rate Swaps The Company’s business is exposed to interest rate risk resulting from fluctuations in interest rates on certain LIBOR-based variable rate debt. Increases in interest rates would increase interest expenses relating to the outstanding variable rate borrowings and increase the cost of debt. Fluctuations in interest rates can also lead to significant fluctuations in the fair value of the debt obligations. On May 15, 2018, the Company entered into a four-year pay-fixed, receive floating (1-month LIBOR), interest rate swap arrangement with a notional amount of $ 400,000 for the period beginning June 1, 2018 and ending on June 1, 2022 . Under the terms of the interest rate swap, the Company pays a fixed rate of 2.84 % against a portion of its LIBOR-based debt and receives floating 1-month LIBOR during the swap period. 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 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 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 The Company enters into foreign currency forward contracts to mitigate the impact of changes in foreign currency exchange rates and to reduce the volatility of purchases and other obligations generated in currencies other than its functional currencies. 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 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. 17 The fair values of derivative instruments in the consolidated condensed balance sheets are as follows: Asset/(Liability) Fair Value Balance Sheet Location June 28, 2021 December 28, 2020 (In thousands) Cash flow derivative instruments designated as hedges: Interest rate swap Other current liabilities $ ( 10,000 ) $ — Interest rate swap Other long-term liabilities — ( 14,968 ) Foreign exchange contracts Other current liabilities ( 47 ) — Cash flow derivative instruments not designated as hedges: Foreign exchange contracts Prepaid expenses and other current assets — 28 Commodity contracts Prepaid expenses and other current assets 99 — 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 quarter and two quarters ended June 28, 2021 and June 29, 2020: Quarter Ended June 28, 2021 Quarter Ended June 29, 2020 Financial Statement Caption Loss Recognized in Other Comprehensive Loss Loss Reclassified into Income Loss Recognized in Other Comprehensive Loss Loss Reclassified into Income (In thousands) Cash flow hedge: Interest rate swap Interest expense $ ( 184 ) $ ( 2,763 ) $ ( 2,583 ) $ ( 2,342 ) Two Quarters Ended June 28, 2021 Two Quarters Ended June 29, 2020 Financial Statement Caption Loss Recognized in Other Comprehensive Loss Loss Reclassified into Income Loss Recognized in Other Comprehensive Loss Loss Reclassified into Income (In thousands) Cash flow hedge: Interest rate swap Interest expense $ ( 535 ) $ ( 5,503 ) $ ( 11,032 ) $ ( 3,517 ) 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 June 28, June 29, 2021 2020 (In thousands) Beginning balance, net of tax $ ( 11,231 ) $ ( 9,617 ) Changes in fair value loss, net of tax ( 203 ) ( 8,012 ) Reclassification to earnings 3,984 2,629 Derecognition of unrealized losses on cash flow hedge due to sale of Mobility business unit — 384 Ending balance, net of tax $ ( 7,450 ) $ ( 14,616 ) Based on the current yield curve, the Company expects that losses of approximately $ 8,068 of the accumulated other comprehensive loss will be reclassified into the statement of operations, net of tax, in the next twelve months. 18 (11) Accumulated Other Comprehensive Loss 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: Foreign Currency Translation Pension Obligation (Losses) Gains on Cash Flow Hedges Total (In thousands) Ending balance as of December 28, 2020 $ ( 24,827 ) $ ( 2,855 ) $ ( 11,231 ) $ ( 38,913 ) Other comprehensive income (loss) before reclassifications 414 29 ( 203 ) 240 Amounts reclassified from accumulated other comprehensive loss — — 3,984 3,984 Other comprehensive income 414 29 3,781 4,224 Ending balance as of June 28, 2021 $ ( 24,413 ) $ ( 2,826 ) $ ( 7,450 ) $ ( 34,689 ) (12) Significant Customers and Concentration of Credit Risk In the normal course of business, the Company extends credit to its customers. 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. The Company’s OEM customers often direct a significant portion of their purchases through EMS companies. 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. 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 The Company measures at fair value its financial and non-financial assets by using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. 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 June 28, 2021 and December 28, 2020 were as follows: As of As of June 28, 2021 December 28, 2020 Carrying Amount Fair Value Carrying Amount Fair Value (In thousands) Derivative assets, current $ 99 $ 99 $ 28 $ 28 Derivative liabilities, current 10,047 10,047 — — Derivative liabilities, non-current — — 14,968 14,968 Senior Notes due March 2029 493,711 500,920 — — Term Loan due September 2024 402,812 405,120 402,370 407,909 Senior Notes due October 2025 — — 370,483 383,974 ABL Revolving Loans 30,000 30,000 70,000 70,000 The fair value of the derivative instruments was determined using pricing models developed based on the LIBOR swap rate, foreign currency exchange rates, and other observable market data, including quoted market prices, as appropriate using Level 2 inputs. The values were adjusted to reflect non-performance risk of both the counterparty and the Company, as necessary. 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. 19 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 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. However, if certain triggering events occur (or are tested at least annually in the case of goodwill) such that a non-financial instrument is required to be evaluated for impairment, based upon a comparison of the non-financial instrument’s fair value to its carrying value, an impairment is recorded to reduce the carrying value to the fair value, if the carrying value exceeds the fair value. (14) Commitments and Contingencies Legal Matters The Company is subject to various legal matters, which it considers normal for its business activities. While the Company currently believes that the amount of any reasonably possible loss for known matters would not be material to the Company’s financial condition, the outcome of these actions is inherently difficult to predict. 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 June 28, 2021 and December 28, 2020. However, these amounts are not material to the consolidated condensed financial statements of the Company. (15) Earnings 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 quarter and two quarters ended June 28, 2021 and June 29, 2020: Quarter Ended Two Quarters Ended June 28, 2021 June 29, 2020 June 28, 2021 June 29, 2020 (In thousands, except per share amounts) Net income from continuing operations $ 28,261 $ 9,346 $ 25,069 $ 6,126 Basic weighted average shares 107,148 106,295 106,987 105,990 Dilutive effect of performance-based restricted stock units, restricted stock units and stock options 1,845 1,190 1,862 1,441 Dilutive effect of outstanding warrants 802 — 401 — Diluted shares 109,795 107,485 109,250 107,431 Earnings per share: Basic $ 0.26 $ 0.09 $ 0.23 $ 0.06 Diluted $ 0.26 $ 0.09 $ 0.23 $ 0.06 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. 20 (16) Stock-Based Compensation Stock-based compensation expense is recognized in the accompanying consolidated condensed statements of operations as follows: Quarter Ended Two Quarters Ended June 28, June 29, June 28, June 29, 2021 2020 2021 2020 (In thousands) (In thousands) Cost of goods sold $ 861 $ 620 $ 2,026 $ 1,470 Selling and marketing 442 291 1,088 742 General and administrative 2,015 1,690 4,370 5,167 Research and development 32 46 75 103 Stock-based compensation expense recognized $ 3,350 $ 2,647 $ 7,559 $ 7,482 Summary of Unrecognized Compensation Costs The following is a summary of total unrecognized compensation costs as of June 28, 2021: Unrecognized Stock-Based Compensation Cost Remaining Weighted Average Recognition Period (In thousands) (In years) RSU awards $ 33,983 1.7 PRU awards 3,159 1.2 Stock options 90 1.0 $ 37,232 (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 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: PCB, RF&S Components, and E-M Solutions. On April 29, 2020, the Company announced the restructuring of its E-M Solutions business unit. In prior periods, the Company’s E-M Solutions business unit consisted of three Chinese manufacturing facilities with two being in Shanghai (SH BPA and SH E-MS) and one in Shenzhen (SZ). 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 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. 21 The Company, including the chief operating decision maker, evaluates segment performance based on reportable segment income, which is operating income before amortization of intangibles. Interest expense and interest income are not presented by segment since they are not included in the measure of segment profitability reviewed by the chief operating decision maker. All inter-segment transactions have been eliminated. Quarter Ended Two Quarters Ended June 28, 2021 June 29, 2020 June 28, 2021 June 29, 2020 (In thousands) Net Sales: PCB $ 553,480 $ 536,843 $ 1,063,966 $ 1,010,845 RF&S Components 13,903 12,091 26,593 21,532 Other (1) — 21,364 3,256 35,567 Total net sales $ 567,383 $ 570,298 $ 1,093,815 $ 1,067,944 Operating Segment Income: PCB $ 73,055 $ 77,714 $ 130,287 $ 137,952 RF&S Components 4,730 4,310 8,592 6,218 Corporate and Other (1) ( 26,472 ) ( 48,083 ) ( 56,861 ) ( 83,102 ) Total operating segment income 51,313 33,941 82,018 61,068 Amortization of definite-lived intangibles (2) ( 10,425 ) ( 10,945 ) ( 21,330 ) ( 21,890 ) Total operating income 40,888 22,996 60,688 39,178 Total other expense ( 10,773 ) ( 18,117 ) ( 34,872 ) ( 35,396 ) Income before income taxes $ 30,115 $ 4,879 $ 25,816 $ 3,782 As of June 28, 2021 December 28, 2020 (In thousands) Segment Assets: PCB $ 1,619,282 $ 1,529,102 RF&S Components 218,919 227,990 Corporate and Other (1) 1,187,535 1,138,852 Total assets $ 3,025,736 $ 2,895,944 (1) Other represents SH E-MS and SZ results. (2) Amortization of definite-lived intangibles primarily relates to the PCB and RF&S Components reportable segments. 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 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. Other than in the United States and China, the Company does not conduct business in any country in which its net sales in that country exceed 10 % of the Company’s total net sales. Net sales are as follows: Quarter Ended Two Quarters Ended June 28, 2021 June 29, 2020 June 28, 2021 June 29, 2020 (In thousands) Net Sales: United States $ 260,944 $ 267,602 $ 529,411 $ 529,881 China 80,160 101,896 161,869 176,825 Other 226,279 200,800 402,535 361,238 Total net sales $ 567,383 $ 570,298 $ 1,093,815 $ 1,067,944 Net sales are attributed to countries by country invoiced. 22 (18) Restructuring Charges On April 29, 2020, the Company announced the restructuring of its E-M Solutions business unit. The E-M Solutions business unit consisted of three Chinese manufacturing facilities with two being in Shanghai (SH BPA and SH E-MS) and one in Shenzhen (SZ). The Company ceased operations at the SH E-MS and SZ facilities while integrating the SH BPA facility into its PCB operations. The restructuring is another step in advancing the Company’s stated strategy of increasing its focus on differentiated higher margin products that more fully leverage the Company’s early engagement capabilities and industry leading engineering-based technology solutions. The Company closed the SH E-MS and SZ facilities at the end of 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. 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 quarter and two quarters ended June 28, 2021 and June 29, 2020. Contract termination and other costs primarily represented plant closure costs. 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 Employee Separation/ Severance Contract Termination and Other Costs Total Employee Separation/ Severance Contract Termination and Other Costs Total (In thousands) Reportable Segment: PCB $ 128 $ 111 $ 239 $ 470 $ 123 $ 593 Corporate and Other (1) 56 264 320 415 2,783 3,198 $ 184 $ 375 $ 559 $ 885 $ 2,906 $ 3,791 Quarter Ended June 29, 2020 Two Quarters Ended June 29, 2020 Employee Separation/ Severance Contract Termination and Other Costs Total Employee Separation/ Severance Contract Termination and Other Costs Total (In thousands) Reportable Segment: PCB $ ( 8 ) $ 1 $ ( 7 ) $ ( 8 ) $ 14 $ 6 Corporate and Other (1) 13,085 336 13,421 13,394 342 13,736 $ 13,077 $ 337 $ 13,414 $ 13,386 $ 356 $ 13,742 (1) Other represents SH E-MS and SZ results. Accrued restructuring costs are included as a component of other current liabilities in the consolidated condensed balance sheet. The table below shows the utilization of the accrued restructuring costs during the two quarters ended June 28, 2021: Employee Separation/ Severance Contract Termination and Other Costs Total (In thousands) Accrued as of December 28, 2020 $ 7,063 $ 319 $ 7,382 Charged to expense 886 2,905 3,791 Amount paid ( 7,897 ) ( 3,179 ) ( 11,076 ) Accrued as of June 28, 2021 $ 52 $ 45 $ 97 23 (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 . 24