Good afternoon ladies and gentlemen. Thank you for standing by. Welcome to the TTM Technologies third quarter 2009 financial results conference call. Here in today’s presentation all parties will be in a listen only mode. Following the presentation the conference will be open for questions. (Operator’s instructions) This conference is being recorded today, November 4, 2009. I would now like to turn the conference over to Mr. Kent Alder, CEO, go ahead, sir.

Okay. And thank you very much. And good afternoon, thanks for joining us for our 2009 third quarter conference call. Joining me on today’s call is TTM’s CFO, Steve Richards. I’ll begin with the review of the business and then Steve will review our financial performance and then we’ll open the call for your questions. But before we get into any details, let me mention that during the course of this call we will make forward-looking statements subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include but are not limited to, fluctuation in quarterly and annual operating results, the volatility and cyclicality of various industries that the company serves and the impact of the current economic crisis and other risks described in TTM’s most recent SEC filing. The company assumes no obligation to update the information provided in this conference call. We will also present non-GAAP financial information in this call. For a reconciliation of our non-GAAP financial information to the equivalent majors under GAAP, please refer to our press release which we filed with the SEC and is posted on our website. Okay. Today we announced our results for the third quarter of fiscal 2009. For the first time in five quarter we realized improvement in our printed circuit board manufacturing segment sales due to growth with our commercial customers, primarily in the computing and networking communications and markets. Our revenue of $139.1 million and EPS of 0.13 excluded nonrecurring charges were line with our guidance. And we continue to generate cash and improve margins through discipline operational management. We increased our cash by $11.3 million to a total cash position of $200.7 million. And although consolidated sales decreased…

Thanks, Kent and good afternoon everyone. As Kent mentioned our existing TTM operations performed well and within guidance in the third quarter when adjusted primarily for facility closure costs. Before I begin, I want to point out that I’ll be discussing our results on a GAAP and non-GAAP basis. As Kent noted, we have included a reconciliation of our non-GAAP financial information in the press release. With that let’s turn to the third quarter results. Third quarter net sales f $139.1 million decreased $5.4 million or 3.7% from the second quarter net sales of $144.5 million, due primarily to weaker demand for commercial back end assemblies. Gross margin for the quarter of 17.4% declined from second quarter gross margin of 18.7%. Excluding inventory write down costs related to the plant closures, gross margin was 19.3%. Selling and marketing expense for the third quarter was $6.5 million or 4.7% of net sales. Compared to second quarter selling and marketing expense of $6.3 million or 4.4% of net sales. Third quarter G&A expense, including amortization of intangibles was $10.3 million or 7.4% of net sales. Second quarter G&A expense including amortization of intangibles was $8.5 million or 5.9% of net sales. The increase in G&A expense in the third quarter was primarily due to costs related to evaluating strategic opportunities as well higher bad debt expense. In the third quarter we encouraged stock based compensation expense of $1.5 million compared to the $1.6 million in the second quarter. 54% of the expense was recorded in G&A, 27% in costs of goods sold and 9% in selling and marketing. During the third quarter, we recorded nonrecurring charges totally $17.1 million, or $0.24 per diluted share. Primarily related to the closure of our Hayward and Los Angeles facilities as well as further impairment of…

Thank you. We will now beginning the question and answer session. (Operator’s instructions) Our first question comes from the line of Amit Daryanani, go ahead. Amit Daryanani – RBC Capital Markets: Thanks all, good afternoon guys. I just had a quick question, I guess, and I looked at your guidance, you’re looking for sales to be to up about 4% sequentially. As you look at the different end markets, can we just talk about what you expect across each of the end markets so we can have a better sense in that?

Sure. Our aerospace and defense, we anticipate that end market being pretty strong for the next quarter. Because of some broad based pipeline activity that we have. So the defense portion of that will be strong. We’re still a little bit weak in the aerospace activity. So, overall that will probably be a little bit light, maybe down another percent in the fourth quarter. This is a first quarter where we’ll maybe go down. We went on a straight line up for the last 10 quarters. So we feel pretty good about the progress that we’re making in aerospace and defense. On the computer peripherals and storage, that will be maybe slightly down a little bit. Not too much change there. We’re at about 12, maybe down a percentage. Medical and industrial should be flat for the next quarter. Communications and networking, when we look out into the future we’re going to see some recovery there at our backplane operation. And we’ll see some continued growth in that end market segment independent circuit board segment. So that will probably be the main segment that increases probably a couple of percentage points in network and communication in the fourth quarter. Amit Daryanani – RBC Capital Markets: Perfect. That’s very helpful. And then I guess, Kent, a lot of companies across the supply chain, this is what I’ve been talking about seeing component shortages and essentially having to scramble to meet the uptake in customer demand. I’m curious if you’re seeing any of these issues that you’re having trouble procuring, like, a raw material that you need? And did you have to leave some revenues on the table at the end of quarter?

The answer is no, we didn’t leave any revenue on the table. And some of the components shortages are mainly coming from the semi-conductor market place. That really doesn’t impact us unless customers can’t get components and they delay orders and so forth. But we haven’t experienced any of that. And our raw material costs with laminate and other raw materials are just not impacted. There’s plenty of supply, so from a material perspective in us being able to get the materials we need, we have no impact whatsoever. Amit Daryanani – RBC Capital Markets: All right. And then just finally, I’m curious if you had any pots on how the competitive landscape would change with a combination of merits in Via systems, and does that actually increase the urgency you may have to gain a bigger presence in Asia?

Our strategy just hasn’t changed. I mean, it was the same before. It’s the same now. We’re pretty consistent in how we approach our acquisition strategy. So it doesn’t change. I think if the Via-Merix, if they get together and create us stronger company financially, that’s probably good for the industry. So it doesn’t impact. I think we competed against them as individuals together. It doesn’t change what we do. We’re going to be pretty solid going forward. Our strategy is in place and it really has no impact on how we operate our business. Amit Daryanani – RBC Capital Markets: Fair enough. Thanks a lot.

Thank you. (Operator’s instructions) Our next question comes from the line of Shawn Harrison with Longbow Research, go ahead. Shawn Harrison – Longbow Research: Just a quick point of clarification. Steve, in terms of the gross margin and SG&A guidance, that includes stock based compensation in those numbers so it could be slightly higher if we took out the stock based comp, correct?

Exactly right. And the stock based comp numbers should be real stable, quarter-to-quarter, about $1.6 million. And the breakdown I gave you by G&A selling and cogs should be about the same as well. Shawn Harrison – Longbow Research: Okay. But the EPS figure you provided excludes stock based compensation?

No, no. The GAAP EPS number reflects the impact of recording that expense. Shawn Harrison – Longbow Research: Then now you have $18-$23 excludes everything?

Exactly. Adds it back. Shawn Harrison – Longbow Research: Okay. Second, just a couple questions more on kind of the environment, if you could comment in terms of what you’re seeing in terms of quick turn demand out there. Generally pricing, because I think DDI on their call recently said their pricing has been a little bit more under pressure in that market. And in general, although your comment today suggested otherwise. And then maybe kind of what, the communications networking customers are saying just about the general health of their business, because it seems like there a little bit more bullish based upon your guidance.

Good question. I think first on the quick turn side of things, our percentage runs about 10%-11%, almost every quarter. But we experienced more activity on quick turn in the third quarter. So that was, I think, a sign that there are some positive things happening. Pricing, we were down on the pricing by about 5%, but that's all due to kind of the mix issues. We did less aerospace and defense. We had some other technology mixes and so forth. When we go out to the marketplace and look at pricing, we're seeing that as pretty stable pretty constant. We're not seeing price pressure. I think a lot of places where might have some price pressures are when you are involved in the lower technology segments of the marketplace, and of course with our quick turn and our facilities and so forth, we're not involved in any of the lower technology products, so we're not seeing any of the price pressure per say. We're not seeing any opportunities, but we're not seeing any price pressure. With regards to the communication in the market, I mean there's a lot of positive comments coming out of that segment and we had — we can't say that it's broad based yet, but it's getting close to being fairly broad based. Some of our larger customers kind of led that end market. But those are some positive signs. I mean, we're encouraged by what we see. We're not going to state that it's going to ramp quickly, but if were to say that the recession is over and we've hit the low point, it feels like the low point is behind us. Shawn Harrison – Longbow Research: Okay. And then just as a final followup, the restructuring savings, the $14 million, should we expect that full annual amount to benefit the P&L by the end of the first calendar quarter in 2010 or maybe if you could just describe how we should expect the savings to roll on this quarter and next quarter and beyond if there's an amount?

Sure. That $14 million should really all be in cost of goods sold and it will begin rolling through in the first quarter. As Kent mentioned, we are planning to ramp down and close our Los Angeles facility this month. We'll still have some people who help to decommission the plant, but most of the folks will terminate this quarter so we'll see a pretty significant impact in the first quarter. The Hayward facility has benefited from some closeout orders and that won't shut down until probably the end of February. So not all that $14 million savings will begin flowing through in the first quarter. I'd say probably about two-thirds in the first quarter and then a full quarterly allocation of that $14 million annually blowing through in the second quarter. Does that make sense? Shawn Harrison – Longbow Research: Perfect sense. Thank you and conjurations on the quarter.

Thank you. And our next question comes from the line of Amitabh Passi with UBS. Amitabh Passi – UBS: Hi, thank you. My first question just had to do with the $1.669 million of costs associated with, I think you called it strategic alternatives. And you treated it as a one time, I'm a little confused about that. I would have thought that would have been sort of an ongoing cost and I'm just wondering whether for the time being you've sort of taken the pursuit of strategic alteratives off the table or if you could just elaborate on why it's considered a onetime cost?

Sure. And I think perhaps don't think of it so much as one-time in nature. What we're trying to do in our non-GAAP schedule that discloses all those items added back is to give you a sense on an apples to apples basis from Q2 to Q3 on how we performed, and so obviously many of those costs are indeed one time and related to the facility closures. The nature of these costs to evaluate specific opportunities are indeed ongoing and so they aren't necessarily one-time in nature, but we saw a spike in that category in the third category and not added back I think would have not given investors a clear apples to apples comparison with Q2. Amitabh Passi – UBS: Okay. Steve, does some of that then continue into the next quarter? Because again I'm trying to reconcile your 11% guidance for SG&A?

Sure. We expect to see about a similar amount of cost in the fourth quarter for that category. Amitabh Passi – UBS: Okay. That's helpful. And then I just wanted to clarify the comment on the $3.5 million per quarter savings that started to kick in, in calendar 1Q 2010. I mean, that looks like another 200 plus basis point improvement in your gross margin. Is that the right way to think about it?

Yeah. The actual percentage will depend on our revenue at that point, but yeah, that $3.5 million quarterly or $14 million a year will flow in about two-thirds in Q1 and then the full amount in Q2 and then that would have a pretty significant impact on our gross margin the same way the closure of the Redmond plant in first quarter benefited our gross margin in second quarter. Amitabh Passi – UBS: And then just a couple of questions on your end markets, any update on progress of business with one of your major Chinese OEMs? And then, any additional color on the strength in your computing storage segment? It was up pretty nicely about 16% I think sequentially, so any incremental insights would be helpful.

I think with our major customer in China that is going to be one of the strengths for the upcoming quarter, so the fourth quarter I think they returned to a level that we ran at in the second quarter. So I think that's a positive sign again for our business in China. With regards to the computing and storage in the market, the improvement there came from servers, storage type products, some reference design boards in the semiconductor marketplace. That's the majority of the improvement in those categories. Amitabh Passi – UBS: Okay great, thank you.

Thank you. And our next question comes from the line of Matt Sheerin. Matt Sheerin – Thomas Weisel Partners: Yes, thanks. Hi, guys. So, you answered a lot of the questions, but on the Backplane business, why was the operating margin so low? It's just been negative leverage off of the decline from a lot of the customers you talked about?

Well, I think on the operating margin basis, Matt, we incurred a pretty significant cost in Hayward as part of the restructuring cost. So $2.2 million inventory write-down that affected the gross profit margin and therefore affected operating margin, and then we also accrued about $800,000 of restructuring costs in Hayward for the ultimate severance we'll pay the employees. So those are the biggest drags on operating income. Matt Sheerin – Thomas Weisel Partners: Well, backing that out apples to apples, then it was down sequentially, right?

Right, that's true. And that's mostly a function of softer sales both in Shanghai and in Hayward from that customer base with the exclusion of our key Chinese customer. Some of it's absorption and some of it's just lower revenue.

Yeah, Matt. Most of that, if you look at our segment, that's where the decline in our quarter came was from our Backplane segments so you got some leverage tied to that. Matt Sheerin – Thomas Weisel Partners: Why was that so weak, do you think; seasons or —

Well, I don't believe it was seasonal. I think there's just some — in our Hayward operation that's been continuing to slide and that continued to slide, in Asia outside of our larger customer and across the board. So we're seeing some improvement in that for the fourth quarter. It's a little hard to project because of the number of customers in that segment, but it appears that that segment will have some recovery in the fourth quarter, particularly in China. And also in Hayward with the closure of that facility I think there's some one-time buys that we'll see in the fourth quarter and so forth.

Hey, Matt, one more thing too as I was looking at my notes while you were talking. We also recorded some pretty significant bad debt expense in both Hayward and Shanghai this quarter. That would affect operating income and that would not be in the one-time costs. So we had a customer issue in Shanghai, not a dramatic one, but a couple hundred thousand dollars there, and we did reserve as part of the Hayward closure for some potential uncollectible debts as we wind down. But that would not have been in the one-time cost add backs. So I think those things are also impacting op margin. Matt Sheerin – Thomas Weisel Partners: And do you get a sense, I mean I know visibility's not great, but looking at the March quarter, do you think some of that Backplane business starts to come back?

I think it'll start to come back in the fourth quarter and that should continue on into the subsequent quarters. Matt Sheerin – Thomas Weisel Partners: Okay. And then I know someone asked about the charges for the M&A expenses or the due diligence, why is that number going up now? Does that mean that you're getting closer to maybe finding some targets and doing some more work? Why are the expenses going up there?

Yeah, Matt. I think every quarter we're pretty clear on our acquisition M&A strategy. With that amount of expense I think it's clear we've been more active on that front. Matt Sheerin – Thomas Weisel Partners: Okay. And given the Viasystems Merix merger, do you feel any more pressure as customers talk to you about the need to have a presence there sooner than later or are you just sticking to your strategy of being cautious and waiting until the right deal comes along?

The answer is we've had a consistent strategy and a consistent criteria for our strategy and we're staying with that. We believe that the right opportunity will present itself and we're going to make sure that we get the right opportunity. Those are long-term decisions, they have to be evaluated very carefully. And to make sure that those types of acquisitions work you have to be very prudent about that. So I think we've been consistent in that clearly with the activity that you see we've been more active recently. Matt Sheerin – Thomas Weisel Partners: Understood. Okay, thanks a lot.

Thank you. And our next question comes from the line of Jiwon Lee with Sidoti & Co. Jiwon Lee – Sidoti & Co.: Thanks. Kent, you may have said it in a different way, but what of the $8 million sale swing in your fourth quarter guidance?

The $8 million swing going from the third quarter to the fourth quarter? Jiwon Lee – Sidoti & Co.: Well actually, the swings embedded on your guidance.

Yeah. I think if we look at our actual performance of $139 million in Q3 and are we going to the midpoint of about say between $140-$138, that's a $144 million increase which is about a $5 million increase. And we'll see some more improvement on the commercial side. In our aerospace and defense we're even forecasting on a dollar basis that to be up. I think the main improvement will come in the back where we'll have some recovery from the weak third quarter. Jiwon Lee – Sidoti & Co.: Okay. Well, that's helpful. And then other than these due diligence costs, was there any other residual restructuring charge in the fourth quarter?

Jiwon, most of the $2.5 million restructuring charge was for severance for LA and Hayward, but you ask a good question. We did record about $170,000 of restructuring charge still related to the Redmond plant closure because we paid our retention bonuses to employees who had continued to serve after that plant was closed to decommission it. Jiwon Lee – Sidoti & Co.: Okay. And lastly, with the pricing going up throughout the year, have you seen any laminate pricing increase recently?

There's some copper involved in the laminate and so that price went up and it's all relative to increases in the copper price, but it really has no impact on our financial performance. That's embedded in our forecast and we've been able to absorb those in the past, so pretty good shape on the material cost side of the equation. Jiwon Lee – Sidoti & Co.: Great. Thank you so much.

Thank you. (Operator's Instructions) And we have a followup question from Shawn Harrison with Longbow Research. Shawn Harrison – Longbow Research: Hi. I've got a few follow ups. Post the closures of Hayward and the LA facility, is there going to be a change in terms of what the incremental gross margin would be? I would assume it should be higher post these closures, maybe closer to 50% versus the mid-40% range you had historically talked about?

That's a good question, Shawn, and certainly similar analysis around that we'll wait until we get closer to the closures and see which customers are transferring and so forth, but I think it's a reasonable assumption to say we go up a little bit. Probably not as much as you indicate, because keep in mind, we do expect to transfer work from both Hayward and Los Angeles in pretty significant amounts from both places. So Stafford Springs and Shanghai will pick up some of the Hayward work and our other commercial plants will pick up some of the LA work. So I don't think the overall mix of sales is going to change a lot with these closures. Shawn Harrison – Longbow Research: Okay. And then as a followup to that, what is capacity utilization right now for the commercial work versus the Backplane work and where would these transitions take those numbers to?

Yeah. That's a good question. On the commercial work we're running about on our printed circuit board about 80%, and by adjusting the base for the restructuring, we'll anticipate moving to about the mid 85%-87% level. On the Backplane Assembly we're running about 60% capacity utilization, maybe just slightly higher. Shawn Harrison – Longbow Research: Okay. And I guess the followup question is does that mean you're going to need to add capacity in 2010 or would you manage upside to demand from the current levels?

Even with the closure of the facilities that we've had this year, and you go back to the beginning of the year we closed the Redmond facility and then the LA and the Hayward. That's two printed circuit board facilities as well as a Backplane operation all in the commercial side of work. We still have more than adequate capacity for any upside in our remaining facilities. It won't change the mix of our work like Steve said. We've reallocated our capacity. I think the footprint that we have right now matches where we need to be in the future and we have plenty of upside in each one of those. We can grow incrementally in all of our facilities. Every one of our facilities now are operating at levels significantly above any critical levels so this closure now matches what we need to have for the marketplace in North America. And with the closures we'll improve our capacity utilization, our productivity will go up, we'll be more efficient, and we'll be more profitable. So I think we're well positioned now with no further closures and adequate upside capability. Shawn Harrison – Longbow Research: Okay. And then two final questions, Steve, as we look at 2010, should we expect maybe a small uptick in SG&A expense either for higher salaries, bonus accrual, things like that? And then the second question maybe to you Ken is after seeing the military budge there for fiscal '10, does it say to you that you could see growth in the military market year over year for your PCB business?

I think we saw the spike in G&A as we discussed already in the third quarter and we'll probably see some similar numbers in the fourth quarter as we discussed already too, but I think after that, SG&A should kind of stabilize at more historic levels. I mean yes, if 2010 is a better year in terms of revenue than we might see a slightly larger increase in some costs, certainly higher selling expense for commission because a lot higher revenue. Perhaps a slightly higher bonus expense, although I don't think it'll be materially different. As a company we didn't have salary increases this year. Obviously a better economy might change that. So there might be some increases in SG&A, but I'm not expecting a big increase.

Yeah. And relative to the second question with aerospace and defense, that end market went up 10 quarters in a row. That's a straight line up for the last 2.5 years and I think that speaks pretty highly of our capabilities and how we're able to service the aerospace and defense end market. And while we had a couple of programs that have paused waiting for revision or came to an end and then are waiting to be replaced by another program, we had enough broad-based activity that still bolstered that end market. We're constantly working with our customers as the largest aerospace and defense supplier in North America we have a lot of programs that we're working on. Our sales team continues to work with our customers on keeping the pipeline full. So we're pretty optimistic about that end market with the defense budget and so forth. And when we talk about 10 straight quarters going up, most of that was in the defense portion because we used to be at say 65%-70% of that end market was defense and the balance aerospace, now that's up to 85%. So while we're well positioned defense, we think there's a real opportunity when the aerospace comes to life again to have some significant growth there too because that's been very quiet for the last year to year and a half. Shawn Harrison – Longbow Research: Okay. Thank you for the insight and thanks for taking all my questions again.

Thank you.

Thank you. And our next question comes from the line of Amitabh Passi with UBS. Amitabh Passi – UBS: Actually most of my questions have been answered, but Steve, maybe just a clarification and I apologize if you talked about this. Tax rate guidance for the fourth quarter and if you have any preliminary views for 2010 and similarly for CapEx?

Sure. CapEx for the year should end probably just shy of $12 million. We don't have a call for 2010 CapEx yet, but we are working on a budget process this quarter and we'll have more feel for CapEx at the end of the quarter. Tax rate actually will probably dip a little bit in the fourth quarter. We had some return to provision changes this quarter as well as the fact that we had a book loss which affected some of the tax deductions we had this quarter. So the spike in tax rate was more of a one-time thing and should subside to a little bit of a lower rate for next quarter, 38-ish, and probably about that same level for 2010. So that's CapEx and tax. Amitabh Passi – UBS: Thank you.

Thank you. Mr. Alder, there are no further questions at this time. Please go ahead.

Okay, thank you. I appreciate everyone's interest in TTM and thanks for joining us on the call. We are encouraged by the future. I think the actions that we've taken over the past 10-11 months with regards to restructuring our business and realigning our footprint will pay dividends in the future. We're optimistic about the commercial marketplace coming back, well positioned in aerospace and defense, so I think we have a strategy that's working, we got a management team that is executing that strategy and we're very excited about where we can go from here. So thank you for your attendance and we'll see you next quarter.

Thank you. Ladies and gentlemen, this concludes the TTM Technologies third quarter 2009 financial results conference call. You may now disconnect.