Hutchinson Technology Inc. (HTCH, Financial) filed Quarterly Report for the period ended 2009-03-29.
Hutchinson Technology Incorporated is an acknowledged world leader in precision manufacturing. Hutchinson Technology specialize in design and manufacture of close-tolerance products that require chemical mechanical and electronic technologies. Its primary products suspension assemblies hold magnetic read-write heads at microscopic distances above the disks in rigid disk drives. The Company is strongly positioned as a provider of technology that our customers value for its ability to help them differentiate their products on performance and value attributes. . Hutchinson Technology Inc. has a market cap of $51.4 million; its shares were traded at around $2.22 with and P/S ratio of 0.1.
Net sales for the thirteen weeks ended March 29, 2009, were $79,004,000, compared to $143,844,000 for the thirteen weeks ended March 30, 2008, a decrease of $64,840,000. Suspension assembly sales decreased $65,141,000 from the thirteen weeks ended March 30, 2008, due to decreased suspension assembly unit shipments and our average selling price decreasing from $0.80 to $0.71 during the same period due to competitive pressures and a higher mix of suspension assemblies for the 3.5-inch ATA segment, which typically has a lower average selling price. The decrease in unit shipments was primarily due to lower demand for disk drives, lower disk drive production as the drive makers reduced inventory levels and loss of market share.
Gross loss for the thirteen weeks ended March 29, 2009, was $11,774,000, compared to gross profit of $18,941,000 for the thirteen weeks ended March 30, 2008, a decrease of $30,715,000. Gross profit as a percent of net sales was negative 15% and positive 13% for the thirteen weeks ended March 29, 2009,and March 30, 2008, respectively. The lower gross profit was primarily due to the substantial decline in net sales, which reduced our ability to cover our fixed costs, and excess capacity. Cost of sales also included higher costs associated with TSA+ flexure production, which reduced gross profit by $7,800,000 for the thirteen weeks ended March 29, 2009, compared to $8,800,000 for the thirteen weeks ended March 30, 2008.
Net sales for the twenty-six weeks ended March 29, 2009, were $198,675,000, compared to $316,921,000 for the twenty-six weeks ended March 30, 2008, a decrease of $118,246,000. Suspension assembly sales decreased $119,438,000 from the twenty-six weeks ended March 30, 2008, due to decreased suspension assembly unit shipments and our average selling price decreasing from $0.80 to $0.74 during the same period due to competitive pressures. The decrease in unit shipments was primarily due to lower demand for disk drives, lower disk drive production as the drive makers reduced inventory levels and loss of market share.
Gross loss for the twenty-six weeks ended March 29, 2009, was $11,907,000, compared to gross profit $51,858,000 for the twenty-six weeks ended March 30, 2008, a decrease of $63,765,000. Gross profit as a percent of net sales was negative 6% and positive 16% for the twenty-six weeks ended March 29, 2009,and March 30, 2008, respectively. The lower gross profit was primarily due to the substantial decline in net sales, which reduced our ability to cover our fixed costs, and excess capacity. Cost of sales also included higher costs associated with TSA+ flexure production, which reduced gross profit by $17,300,000 for the twenty-six weeks ended March 29, 2009, compared to $16,300,000 for the twenty-six weeks ended March 30, 2008.
Our principal sources of liquidity are cash and cash equivalents, short- and long-term investments, cash flow from operations and additional financing capacity, if available given current credit market conditions and our operating performance. Our cash and cash equivalents increased from $62,309,000 at September 28, 2008, to $184,610,000 at March 29, 2009. Our short- and long-term investments decreased from $201,110,000 to $108,053,000 during the same period. In total, our cash and cash equivalents and short- and long-term investments increased by $29,244,000. This increase is primarily due to $59,506,000 of net proceeds drawn from the UBS Credit Line (defined below), $29,646,000 of cash generated from operations, and $1,062,000 in net proceeds from issuances of our common stock from our employee stock purchase plan during the first half of 2009. These increases were partially offset by $48,469,000 for repayments of long-term debt and $17,693,000 for capital expenditures. The cash generated from operations is net of $11,801,000 of severance and other expenses for the twenty six weeks ended March 29, 2009.
Read the The complete ReportHTCH is in the portfolios of Arnold Van Den Berg of Century Management.
Hutchinson Technology Incorporated is an acknowledged world leader in precision manufacturing. Hutchinson Technology specialize in design and manufacture of close-tolerance products that require chemical mechanical and electronic technologies. Its primary products suspension assemblies hold magnetic read-write heads at microscopic distances above the disks in rigid disk drives. The Company is strongly positioned as a provider of technology that our customers value for its ability to help them differentiate their products on performance and value attributes. . Hutchinson Technology Inc. has a market cap of $51.4 million; its shares were traded at around $2.22 with and P/S ratio of 0.1.
Highlight of Business Operations:
We spent $39,711,000 on research and development in 2008 compared to $55,245,000 in 2007. In 2007, we continued development of the additive processes required for our TSA+ suspension assemblies and development of new process technologies for next-generation suspension assembly products and equipment. The decrease in 2008 was primarily attributable to $11,018,000 of lower expenses primarily related to the classification of the costs of running the TSA+ manufacturing lines as cost of sales beginning in the fourth quarter of 2007. Research and development spending specific to our BioMeasurement Division was $4,767,000 in 2008 and $4,207,000 in 2007. During the first half of 2009, we spent $16,337,000 on research and development, with $2,268,000 specific to our BioMeasurement Division. We expect our research and development spending in 2009 will be approximately $30,000,000.Net sales for the thirteen weeks ended March 29, 2009, were $79,004,000, compared to $143,844,000 for the thirteen weeks ended March 30, 2008, a decrease of $64,840,000. Suspension assembly sales decreased $65,141,000 from the thirteen weeks ended March 30, 2008, due to decreased suspension assembly unit shipments and our average selling price decreasing from $0.80 to $0.71 during the same period due to competitive pressures and a higher mix of suspension assemblies for the 3.5-inch ATA segment, which typically has a lower average selling price. The decrease in unit shipments was primarily due to lower demand for disk drives, lower disk drive production as the drive makers reduced inventory levels and loss of market share.
Gross loss for the thirteen weeks ended March 29, 2009, was $11,774,000, compared to gross profit of $18,941,000 for the thirteen weeks ended March 30, 2008, a decrease of $30,715,000. Gross profit as a percent of net sales was negative 15% and positive 13% for the thirteen weeks ended March 29, 2009,and March 30, 2008, respectively. The lower gross profit was primarily due to the substantial decline in net sales, which reduced our ability to cover our fixed costs, and excess capacity. Cost of sales also included higher costs associated with TSA+ flexure production, which reduced gross profit by $7,800,000 for the thirteen weeks ended March 29, 2009, compared to $8,800,000 for the thirteen weeks ended March 30, 2008.
Net sales for the twenty-six weeks ended March 29, 2009, were $198,675,000, compared to $316,921,000 for the twenty-six weeks ended March 30, 2008, a decrease of $118,246,000. Suspension assembly sales decreased $119,438,000 from the twenty-six weeks ended March 30, 2008, due to decreased suspension assembly unit shipments and our average selling price decreasing from $0.80 to $0.74 during the same period due to competitive pressures. The decrease in unit shipments was primarily due to lower demand for disk drives, lower disk drive production as the drive makers reduced inventory levels and loss of market share.
Gross loss for the twenty-six weeks ended March 29, 2009, was $11,907,000, compared to gross profit $51,858,000 for the twenty-six weeks ended March 30, 2008, a decrease of $63,765,000. Gross profit as a percent of net sales was negative 6% and positive 16% for the twenty-six weeks ended March 29, 2009,and March 30, 2008, respectively. The lower gross profit was primarily due to the substantial decline in net sales, which reduced our ability to cover our fixed costs, and excess capacity. Cost of sales also included higher costs associated with TSA+ flexure production, which reduced gross profit by $17,300,000 for the twenty-six weeks ended March 29, 2009, compared to $16,300,000 for the twenty-six weeks ended March 30, 2008.
Our principal sources of liquidity are cash and cash equivalents, short- and long-term investments, cash flow from operations and additional financing capacity, if available given current credit market conditions and our operating performance. Our cash and cash equivalents increased from $62,309,000 at September 28, 2008, to $184,610,000 at March 29, 2009. Our short- and long-term investments decreased from $201,110,000 to $108,053,000 during the same period. In total, our cash and cash equivalents and short- and long-term investments increased by $29,244,000. This increase is primarily due to $59,506,000 of net proceeds drawn from the UBS Credit Line (defined below), $29,646,000 of cash generated from operations, and $1,062,000 in net proceeds from issuances of our common stock from our employee stock purchase plan during the first half of 2009. These increases were partially offset by $48,469,000 for repayments of long-term debt and $17,693,000 for capital expenditures. The cash generated from operations is net of $11,801,000 of severance and other expenses for the twenty six weeks ended March 29, 2009.
Read the The complete ReportHTCH is in the portfolios of Arnold Van Den Berg of Century Management.
