Ttm Technologies, Inc. · NASDAQ:TTMI
Ttm Technologies — Investor Presentation (May 2018)
34 slides from Ttm Technologies's investor presentation, May 29, 2018
Slide 1: TTM Technologies, Inc.
TTM Technologies, Inc. Todd Schull, Chief Financial Officer May 22, 2018 Exhibit 99.2
Slide 2: Disclaimers: Forward-Looking Statements
Disclaimers Forward-Looking Statements This communication may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to the future business outlook, events, and expected performance of TTM Technologies, Inc. (“TTM
Slide 3: Outline
Outline Who is TTM? Growth Drivers TTM Differentiation Recent Events TTM and Anaren Financial Highlights
Slide 4: Leading Global Printed Circuit Board Manufacturer
Critical supplier to today’s fastest growing technologies such as smart phones, automobile technology and medical imaging Significant global footprint with 25 facilities, 30,000 employees and $2.8 billion in assets Scale: $2,659 mm FY2017 revenue Profitability: $389mm FY2017 Adj. EBITDA1 Technology-
Slide 5: Why Invest in TTM?
Why Invest in TTM? Solid end market growth with a focus on A&D and Auto Diverse end markets Differentiated through scale, scope and breadth Operating and financial leverage provides earnings power Strong free cash flow generation
Slide 6: End Market Growth Drivers and Outlook
End Market Growth Drivers and Outlook Source: TTM filings, Prismark Partners Feb 2017, BCA Research, Company estimates 1 Other mobile devices such as e-readers are included in the “Other” end market FY 2017 Net Sales 16% End Market Growth Drivers 2016 – 2021 CAGR (3rd party) Increased Commercial Air
Slide 7: Aerospace and Defense Megatrends
Aerospace and Defense Megatrends Commercial Fleet Upgrade Increasing Passenger Traffic Increasing Defense Budgets Key Program ramps Boeing record backlog 7.6% YoY 2017 Airline Traffic 20% Increase FY17-FY19 79 key DoD Program ramps
Slide 8: Leading Player Aligned with Top Tier A&D Customers
Leading Player Aligned with Top Tier A&D Customers Record Revenues #1 A&D PCB Manufacturer with 2017 Revenues of ~$420M
Slide 9: End Market Growth Drivers and Outlook
End Market Growth Drivers and Outlook Source: TTM filings, Prismark Partners Feb 2017, Company estimates 1 Other mobile devices such as e-readers are included in the “Other” end market FY 2017 Net Sales 16% End Market Growth Drivers 2016 – 2021 CAGR (3rd party) 5-8% Increased Commercial Air Traffic
Slide 10: Automotive Megatrends
Automotive Megatrends Vehicle Safety Advanced Driver Assistance Systems (radar, LiDar, cameras) CAGR 10% (Source: Markets and Markets) Automated Driving Sensors, Cameras, GPS, Radar, LiDar Artificial Intelligence CAGR 134% (Source: Business Insider, Lux Research) Connectivity/ Infotainment Wireless
Slide 11: Drives Increasing Electronic Content
Drives Increasing Electronic Content PCB Usage per Car Type Sq. Meter USD MM units Compact 0.4 – 0.5 30– 40 ~ 36.4 Mid-Range 0.5 – 0.8 50 – 70 ~ 56.4 Luxury 1.5 – 3.0 100 - 150 ~ 7.2 Source: NTI Digest, September 2017 1.7% CAGR 5.0% CAGR 6.7% CAGR Average PCB content per vehicle $62 in 2016 to $75 i
Slide 12: Leading Player Aligned with Tier Auto Suppliers
Leading Player Aligned with Tier 1 Auto Suppliers #2 Auto PCB Manufacturer1 with 2017 Revenues of ~$510M 1 NTI Dec 2016 Report Record Revenues
Slide 13: End Market Growth Drivers and Outlook
End Market Growth Drivers and Outlook Source: TTM filings, Prismark Partners Nov 2017, Company estimates 1 Other end market includes other consumer devices such as wearables, portable video devices and personal headphones Networking / Communications Medical / Industrial / Instrumentation 4G/5G Infra
Slide 14: TTM Offers Broad Technology Capabilities
TTM Offers Broad Technology Capabilities Highly Reliable High Layer Conventional (63% of FY 17 Rev) High Density Interconnect (HDI) Advanced (37% of FY 17 Rev) RF Substrate Smartphone Aerospace and Defense Auto Aerospace and Defense, Networking Aerospace and Defense Auto Increasing focus on advanced
Slide 15: Customer Engagement Model
Customer Engagement Model Time Concept Production Pilot Production Consumer Aerospace & Defense Automotive Networking Engineering Development Prototype 6 Mo’s 1 yr 2 yrs 3 yrs 4 yrs 5 yrs 6 yrs 7 -10 yrs Engaging customers from concept to volume production
Slide 16: Operations Close to Customer's Supply Chain
12 Operations Close to Customer’s Supply Chain 12 13 18 19 23 24 7 9 1 10 8 5 16 3 4 21 14 6 15 11 19 17 22 2 25 Zhongshan - ZS 21 Chippewa Falls 22 Dongguan - DMC Hong Kong - OPCM 20 Communications Medical, Ind, Inst 16 Toronto - TOR 14 Logan - LG 15 San Jose - SJ Mobility 19 Shanghai - SP 17 Guang
Slide 17: Recent Events: Acquisition of Anaren, Inc.
Recent Events TTM Technologies, Inc. Acquisition of Anaren, Inc.
Slide 18: Transaction Overview
Transaction Overview $775M purchase price for 100% equity in Anaren, Inc., subject to working capital adjustment at closing 100% cash consideration, financed with: $600M incremental senior secured term loan facility under TTM’s existing credit agreement, and cash on hand TRANSACTION CONSIDERATION Cl
Slide 19: Anaren Overview
Anaren Overview Leading provider of mission-critical RF / microwave solutions for space, defense and wireless infrastructure end markets Sole-sourced and spec’d in positions on high-priority programs through custom-designed, highly- integrated subsystems and components LTM 12/30/17 revenue of $234M
Slide 20: Strategic Rationale
Strategic Rationale Provides differentiated RF expertise in space & defense and embedded technology critical to wireless infrastructure Enhances TTM’s strong A&D position and provides new market growth opportunity for the industrial, medical and automotive markets Significantly enhances TTM’s A&D bu
Slide 21: Financial Overview
oy Se Financial Overview
Slide 22: Reported Revenue and Profit Growth
Reported Revenue and Profit Growth Improving margins and EPS 1See Appendix for reconciliation
Slide 23: Strong Free Cash Flow Generation
Strong Free Cash Flow Generation *Free Cash Flow is Operating Cash Flow minus capex 1See Appendix for reconciliation Free cash flow used to pay down debt
Slide 24: Recent Quarterly Trends
Recent Quarterly Trends 1See Appendix for reconciliation
Slide 25: TTM + Anaren: Strengthened Financial Profile
TTM+ Anaren: Strengthened Financial Profile 25 Revenue EBITDA(1) Source: Company disclosure, in $ millions. Non-GAAP EBIT Margin and Adjusted EBITDA. Excludes cost savings. See appendix for reconciliation. Including ~$15 million in run-rate cost savings. EBIT(1) TTM Anaren TTM + Anaren 14.4% 16.1% 1
Slide 26: Investment Highlights
Investment Highlights Global leader in the PCB manufacturing market with emphasis on advanced technology Diverse end markets with growth opportunities in automotive and aerospace and defense One stop shop offering a breadth of products and services ranging from concept to volume production globally
Slide 27: Appendix
Appendix
Slide 28: A Leading Global Player
A Leading Global Player 2016* Top 10 world PCB manufacturers by revenue ($ millions) Note*: According to Prismark’s 2016 Estimates Source: Prismark Partners May 2017 (Ref: 217.3/316kk) Top 10 represent ~33% of 2016E total world PCB output $M A leading supplier to commercial aerospace & defense contr
Slide 29: The Evolution of TTM Through Strategic Acquisitions
The Evolution of TTM Through Strategic Acquisitions 1998 TTM Incorporated 2000 IPO 2002 Acquires Honeywell 2006 Acquires Tyco 2010 Acquires Meadville 2015 Acquires Via Networking/Communications High layer count Cellular market Asia footprint Automotive Synergies Aerospace & Defense Diversification $
Slide 30: Focused Defense Product Areas
Focused Defense Product Area’s Microwave Systems F-35 (JSF) AMDR Q-53 F-16 (SABR) JSTARS SEWIP Missile Systems AMRAAM Standard Missile JAGM JDAM Hellfire Paveway Communication Systems JTRS Soldier Radio Rifleman MANPACK Space Systems Orion GOES GPS III SBIRS XM4
Slide 31: Key Outstanding Debt
Key Outstanding Debt Term loan B ($950 million) Inclusive of $600 additional for Anaren Due September, 2024 Interest rate: Libor plus 2.50% High Yield Bond ($375 million) Due October, 2025 Interest rate: 5.625% Convertible notes ($250 million) Due Dec 15, 2020 Interest rate 1.75% Conversion price $9
Slide 32: Reconciliations
Reconciliations itm “Stoicbased compensation 03 04 04 05 o4 06 0s 06 0s Non-GAAP Gross Proft %9 384 Too Tas 754 365 ora T8 302 ‘GAtP Operating Income 189 ur 502 08 528 453 444 no 300 ‘edback tems ‘Amorizaton oi 59 59 so 64 so 50 59 59 59 Stock-based compensation 22 28 28 32 38 80 a7 50 38 (Gainjioss
Slide 33: Reconciliations
Reconciliations 2014 2015 2016 2017 $194.7 $310.1 $423.6 $429.6 162 . 44 16 1956 Sas WBZ Bie GAAP Operating Income 465 61.3 1738 212.8 ‘Ra back items: ‘Amortzaton of intangbe a4 189 243 26 Stoskbased eonpansaton 78 7 4 183 inyaientrevrucurng, an acqustion 79 423 46 36 ry mrkup 162 . : er infrequent
Slide 34: Anaren Operating Income and EBITDA Reconciliation
Anaren Operating Income and EBITDA Reconciliation Note: Figures may not sum exactly due to rounding. ($ in millions) CY2015A CY2016A LTM 9/30/17 CY2017A Reported Operating Income $6.7 $14.1 $25.5 $32.4 Stock based compensation 0.8 0.7 0.7 0.7 Sponsor fee 1.3 1.3 1.4 1.4 Debt related fees 0.3 0.3 0.3