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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2002

Commission file number 0-31285

TTM TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in Its Charter)

        Securities registered pursuant to Section 12(g) of the Exchange Act:

        Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

        The aggregate market value of Common Stock held by nonaffiliates of the registrant (20,605,355) based on the closing price of the registrant's Common Stock as reported on the Nasdaq National Market on July 1, 2002, was $113,123,399. For purposes of this computation, all officers, directors, and 10% beneficial owners of the registrant are deemed to be affiliates. Such determination should not be deemed to be an admission that such officers, directors, or 10% beneficial owners are, in fact, affiliates of the registrant.

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act. Yes ý    No o

        As of March 18, 2003, there were outstanding 39,821,972 shares of the registrant's Common Stock, no par value.

Documents Incorporated by Reference

        Portions of the registrant's definitive Proxy Statement for the 2003 Annual Meeting of Shareholders are incorporated by reference into Part III (Items 10 - 13) of this Form 10-K.

TTM TECHNOLOGIES, INC.

ANNUAL REPORT ON FORM 10-K

TABLE OF CONTENTS

Statement Regarding Forward-Looking Statements

        This report on Form 10-K contains forward-looking statements regarding future events or our future financial and operational performance. Forward-looking statements include statements regarding markets for our products; trends in net sales, gross profits and estimated expense levels; liquidity and anticipated cash needs and availability; and any statement that contains the words "anticipate," "believe," "plan,""forecast," "foresee", "estimate," "project," "expect," "seek", "target", "intend", "goal" and other similar expressions. The forward-looking statements included in this report reflect our current expectations and beliefs, and we do not undertake publicly to update or revise these statements, even if experience or future changes make it clear that any projected results expressed in this report, annual or quarterly reports to shareholders, press releases or company statements will not be realized. In addition, the inclusion of any statement in this report does not constitute an admission by us that the events or circumstances described in such statement are material. Furthermore, we wish to caution and advise readers that these statements are based on assumptions that may not materialize and may involve risks and uncertainties, many of which are beyond our control, that could cause actual events or performance to differ materially from those contained or implied in these forward-looking statements. These risks and uncertainties include the business and economic risks described in Item 1, "Business—Risk Factors That May Affect Future Results."

PART I

ITEM 1. BUSINESS

Overview

        TTM Technologies, Inc. provides time-critical and technologically complex multilayer printed circuit boards (PCBs), which serve as the foundation of sophisticated electronic products. Products within the markets we serve—including communications infrastructure equipment, industrial and medical equipment, and computer servers—are characterized by high levels of complexity and short life cycles. Our customers include original equipment manufacturers, or OEMs, and contract manufacturers in the electronics industry, also known as electronic manufacturing services companies.

        TTM is a one-stop manufacturer, providing printed circuit boards that satisfy all stages of an electronic product's life cycle—from prototype to volume production. We utilize a facility specialization strategy in which each order or part number is directed to the facility best suited to the customer's particular delivery time, product complexity and volume needs. Our three facilities use compatible technologies and manufacturing processes, allowing us to move orders between plants to optimize operating efficiency. This strategy results in faster delivery times and enhanced product quality and consistency.

        Our one-stop manufacturing solution includes:

Quick-turn services:

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Prototype production.  Quick-turn prototypes are used in the design, test, and launch phases of new electronic products. As such, we manufacture prototype PCBs in small quantities of up to 50 boards per order that require delivery times ranging from as little as 24 hours to 10 days.



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Ramp-to-volume production.  Our ramp-to-volume services typically include manufacturing up to several hundred printed circuit boards per order, with delivery times ranging from two to 10 days—supporting customers in the pre-production phase.

        For the years ended December 31, 2001 and 2002, orders with delivery requirements of 10 days or less represented 40% and 47% of our gross sales, respectively. These quick-turn orders represented a significantly higher percentage of sales for our Santa Ana, California facility, which focuses on prototype production and new customer development.

Standard delivery time services:

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Mid-volume production.  Our mid-volume production services, also referred to as high-mix production, include manufacturing up to several hundred printed circuit boards per order, with delivery times ranging from three to eight weeks. These products typically have a relatively high engineering content because of the relatively low volume per part or product number.



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Volume production.  This specialized volume production encompasses very high technology printed circuit boards, with up to 54 layers and extremely fine geometries and tolerances. Our ability to produce such complex PCBs for high-end commercial applications was augmented by the acquisition of Honeywell Advanced Circuits, Inc. in December 2002.

        Our Redmond, Washington facility primarily handles ramp-to-volume and mid-volume production, with some capacity for prototype production. During 2002, we closed our Burlington, Washington facility, and consolidated production into an expanded Redmond plant to enhance operating efficiency and reduce costs. Our newly acquired Chippewa Falls, Wisconsin facility focuses almost entirely on the very high technology segment of the PCB industry, with standard delivery times. (See Item 1, Business—Recent Developments.)

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        Our significant original equipment manufacturer customers include Adtran, Agilent Technologies, Cisco, Hewlett-Packard (Formerly Compaq), IBM, Lucent, Micron Technology, Motorola, Philips Ultrasound, Radisys, Sun Microsystems, and Thales. Our significant electronic manufacturing services customers include ACD, Celestica, Flextronics, Jabil Circuit, Plexus, Smtek, Solectron, and Viasystems. As of December 31, 2002, we had approximately 565 customers, compared to approximately 600 customers at December 31, 2001.

Recent Developments

        On December 26, 2002, we acquired all of the outstanding capital stock of Honeywell Advanced Circuits, Inc. ("Advanced Circuits"), a subsidiary of Honeywell International, Inc. Advanced Circuits is a printed circuit board manufacturer with expertise in high layer counts and specialty materials. The acquisition represents a synergistic combination of TTM's quick-turn/high-mix focus and Advanced Circuits's high-tech capabilities, and nearly doubles the company's revenues.

        The purchase price was one dollar. The total cost of the acquisition, including transaction fees and expenses was approximately $0.9 million. Advanced Circuit's primary manufacturing facility is located in Chippewa Falls, Wisconsin.

Industry Background

        Printed circuit boards are manufactured from sheets of laminated material, or panels. Each panel is typically subdivided into multiple printed circuit boards, each consisting of a pattern of electrical circuitry etched from copper to provide an electrical connection between the components mounted to it.

        Printed circuit boards serve as the foundation for virtually all electronic products, ranging from consumer products (such as cellular telephones and personal computers) to high-end commercial electronic equipment (such as medical equipment, data communications routers and switches, and servers). Generally, consumer electronics products utilize commodity-type PCBs with lower layer counts and complexity. High-end commercial equipment products require more customized, multilayer printed circuit boards using advanced technologies, such as high aspect ratios, blind and buried vias, microvias, advanced materials, and combination surface finishes.

        TTM specializes in complex printed circuit boards used in high-end commercial equipment. We provide a number of advanced technologies, producing printed circuit boards of up to 54 layers, with extremely fine geometries and tolerances. Manufacturing increasingly sophisticated PCBs requires substantial capital and ongoing investment in advanced production facilities, engineering, and process technology. It also requires a skilled workforce and manufacturing expertise.

        Over the past two years, the sharp slowdown in the electronics industry has reduced demand for printed circuit boards. Pricing has also suffered, due to excess capacity and increased competition from Asian manufacturers. Mass produced circuit boards with low levels of technology and longer lead times have experienced downward pricing pressures and are most subject to competition from foreign manufacturers. Printed circuit boards employing complex technologies and/or boards that can be manufactured very quickly are subject to less foreign competition. As such, they have been somewhat insulated from these pricing pressures. Many of the unique challenges involved in successfully designing and manufacturing highly complex printed circuit boards—and the ongoing capital investment required to maintain state-of-the-art capabilities—have effectively served as barriers to entry in this segment of printed circuit board manufacturing.

        As a result of these factors, there has been significant industry consolidation and many plant closings throughout 2001 and 2002. North American PCB manufacturing capacity has been reduced by an estimated 30 to 35% of annual capacity.

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Strategy

        Our goal is to be the leading provider of time-critical, one-stop manufacturing services for highly complex printed circuit boards. Key aspects of our strategy include:

        Using our quick-turn capabilities to target customers in high-growth markets.    Our time-to-market philosophy capitalizes on the rapid introduction and short product life cycle of advanced electronic products. We focus our marketing efforts on original equipment manufacturers and electronic manufacturing services providers in high-growth markets. In 2002, we expanded our sales force from 85 at December 31, 2001 to add the 22 Advanced Circuits sales employees at December 31, 2002. Our sales force is primarily comprised of commission-based, independent sales representatives, as well as a direct sales force.

        Aggressively managing our manufacturing capacity to maximize profitability.    In response to decreased product demand, we have adjusted our head count and manufacturing capacity to maximize profitability, while continuing to meet the demands of new and existing customers. In December 2002, we closed our Burlington, Washington facility and consolidated production into an expanded Redmond facility to reduce costs and enhance operating efficiency. We acquired manufacturing capacity for high technology complex printed circuit boards through our acquisition of Advanced Circuits on December 26, 2002.

        Capitalizing on our one-stop manufacturing solution.    Our quick-turn capabilities allow us to establish relationships with customers early in a product's life cycle, giving us an advantage in securing preferred vendor status for subsequent mid-volume and volume production opportunities. We also seek to gain quick-turn business from our existing mid-volume and volume customers.

        Continuing to improve our technological capabilities and process management systems.    We are consistently among the first to adopt new developments in printed circuit board manufacturing processes and technology. We continuously evaluate new processes and technology to further reduce our delivery times, improve quality, increase yields, and decrease costs. We will continue to pursue our facility specialization strategy and deploy manufacturing processes and technology suited for each customer's delivery time, product complexity and volume requirements. In addition, we will continue to develop and implement manufacturing processes and technology that allow our facilities to remain fully integrated.

        Pursuing complementary acquisition and alliance opportunities.    We actively consider strategic acquisitions of printed circuit board companies and technologies that may enhance our competitive position by strengthening our service offering and expanding our customer base. Specific niche-oriented opportunities include expanding our quick-turn capacity, expanding specialty materials opportunities with military/aerospace end-market exposure, and developing an Asian production relationship.

        Our July 1999 acquisition of Power Circuits provided us with significant quick-turn manufacturing capabilities and diversified our customer base and end markets. Our December 2002 acquisition of Advanced Circuits provided us with complex technologies and the ability to utilize exotic materials and manufacture higher layer counts. Advanced Circuits serves a small number of blue-chip customers who do not overlap with our existing customers. We plan to cross sell our quick-turn capabilities to Advanced Circuit's customers and market Advanced Circuit's high-tech capabilities to TTM's existing customer base.

Services

        We provide our customers with an integrated manufacturing solution that encompasses all stages of an electronic product's life cycle from prototype, through ramp-to-volume and mid-volume

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production, to volume production. We offer quick-turn and standard time delivery services, including the following:

        Prototype production.    We provide prototype services primarily at our facility in Santa Ana, California, where we serve customers that require limited quantities of printed circuit boards. A typical order size is up to 50 printed circuit boards, with delivery times ranging from 24 hours to 10 days. Our Santa Ana facility is available seven days per week and 24 hours per day to be able to respond quickly to customer orders. Our Redmond, Washington facility can supplement prototype production. We believe the ability to meet our customers' prototype demands strengthens our long-term relationships and gives us an advantage in securing a preferred vendor status when customers begin ramp-to-volume, mid-volume, and volume production.

        Ramp-to-volume production.    We provide ramp-to-volume services primarily at our facility in Redmond, Washington. Our ramp-to-volume service typically includes the manufacture of up to several hundred printed circuit boards per order, with delivery times ranging from two to 10 days. We provide our customers with ramp-to-volume services to transition a product from prototype to mid-volume production or as a temporary solution for unforeseen manufacturing issues or customer demands. Our Redmond facility is available seven days per week and 24 hours per day to be able to respond quickly to customer orders. We also provide ramp-to-volume production as a secondary use at our Santa Ana facility.

        Mid-volume production.    We provide mid-volume production primarily at our facility in Redmond, Washington, where we manufacture printed circuit boards for use in the commercial production phase. Our mid-volume production service targets higher complexity printed circuit boards and manufactures up to several hundred printed circuit boards per order, with delivery times typically ranging from three to eight weeks. Our mid-volume production services complement our prototype and ramp-to-volume production and allow us to offer customers one-stop manufacturing capabilities. We also supplement mid-volume production at our Chippewa Falls, Wisconsin facility.

        Volume production.    Our ability to produce very high technology printed circuit boards in volume is led by Advanced Circuit's Chippewa Falls, Wisconsin facility, which has an average layer count of approximately 18 and expertise in specialty materials.

Technology

        The market for our products is characterized by rapidly evolving technology. In recent years, the trend in the electronic products industry has been to increase the speed, complexity, and performance of components while reducing their size. We believe our technological capabilities allow us to address the needs of manufacturers who must bring complicated electronic products to market faster.

        To manufacture printed circuit boards, we generally receive circuit designs directly from our customers in the form of computer data files, which we review to ensure data accuracy and product manufacturability. Processing these computer files with computer aided design (CAD) technology, we generate images of the circuit patterns that we then physically develop on individual layers, using advanced photographic processes. Through a variety of plating and etching processes, we selectively add and remove conductive materials to form horizontal layers of thin circuits called traces, which are separated by insulating material. A finished multilayer circuit board laminates together a number of layers of circuitry, using intense heat and pressure under vacuum. Vertical connections between layers are achieved by plating through small holes called vias. Vias are made by highly specialized drilling equipment capable of achieving extremely fine tolerances with high accuracy. We specialize in high layer printed circuit boards with extremely fine geometries and tolerances. Because of the tolerances involved, we employ clean rooms in certain manufacturing processes where tiny particles might

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otherwise create defects on the circuit patterns, and we use automated optical inspection systems to ensure consistent quality.

        We believe our highly specialized equipment is among the most advanced in the industry. We provide a number of advanced technologies, including:

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Up to 54 layer printed circuit boards.



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Blind and buried vias.



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Buried capacitance.



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Fine line traces and spaces.



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High aspect ratios.



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Thin core processing.



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Microvias.



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Fulfill™ hole fill process.



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Advanced materials.



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Multiple surface finishes.



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Combination surface finishes.

Customers and Markets

        Our customers include both original equipment manufacturers and electronic manufacturing services providers that primarily serve the networking/communications, industrial/medical, and high-end computing segments of the electronics industry. We measure customers as those companies that have placed at least two orders in the preceding 12-month period. As of December 31, 2001, we had approximately 600 customers, and as of December 31, 2002, we had approximately 565 customers.

        Our significant customers include:

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        The following table shows the percentage of our net sales in each of the principal end markets we served for the periods indicated:

(1)

Sales to electronic manufacturing services providers are classified by the end markets of their customers.

        We expect the networking/communications and high-end computing principal end markets to become the majority of our sales mix in 2003.

        Sales to our largest customer, Solectron, accounted for 11.1% of our net sales in 2001 and 8.4% of our net sales in 2002. Sales to our 10 top customers accounted for 46.1% of our net sales in 2001 and 41.8% of our net sales in 2002.

        In 2002, approximately 94% of our net sales were in the United States, 2% in Malaysia, 1% in Canada, and the remainder primarily in other European and Asian countries.

        Our acquisition of Advanced Circuits in December 2002 is expected to significantly alter the percentage of sales in each of the principal end markets we serve, increase the concentration of our net sales from our 10 top customers and increase our percentage of international net sales.

Sales and Marketing

        Our marketing strategy focuses on establishing long-term relationships with our customers' engineering and new product introduction personnel early in the product development phase. As the product moves from the prototype stage through ramp-to-volume and volume production, we shift our focus to the customers' procurement department, in order to capture sales at each point in the product's life cycle.

        With respect to manufacturing feasibility, design review, and technology limits, our staff of engineers, sales support, and managers assist our sales representatives in advising customers through direct communication and visits. We combine our sales efforts with customer service at each facility to better serve our customers. Each customer is assigned one salesperson for all services across all facilities, in order to establish individual accountability for each client.

        Our sales force is primarily comprised of commission-based, independent sales representatives, complemented by a direct sales force. We expanded our sales force from 85 at year-end 2001 to add the 22 Advanced Circuits sales employees at year-end 2002, helping us to capture new customers and gain market share as the PCB industry consolidates.

Suppliers

        The primary raw materials used in production include: copper-clad layers of fiberglass of varying thicknesses, impregnated with bonding materials; chemical solutions such as copper and gold for plating operations; and photographic film, carbide drill bits, and plastic for testing fixtures.

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        We use just-in-time procurement practices to maintain our raw materials inventory at low levels and work closely with our suppliers to obtain technologically advanced raw materials. Although we have preferred suppliers for some raw materials, those we use are generally readily available in the open market from numerous other potential suppliers. In addition, we periodically seek alternative supply sources to ensure that we are receiving competitive pricing and service. Adequate amounts of all raw materials have been available in the past, and we believe this availability will continue in to the foreseeable future.

Competition

        Despite industry consolidation, the printed circuit board industry is fragmented and characterized by intense competition. Our principal domestic competitors include: DDi, Endicott Interconnect Technologies, Merix, Sanmina-SCI, and Tyco.

        We believe we compete favorably, based on the following competitive factors:

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Capability and flexibility to produce customized complex products;



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Ability to offer time-to-market capabilities;



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Ability to offer one-stop manufacturing capabilities;



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Consistent high-quality product; and



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Outstanding customer service.

        In addition, we believe our continuous evaluation and early adoption of new manufacturing and production technologies give us a competitive advantage. We believe that manufacturers like us who have the ability to manufacture printed circuit boards using advanced technologies such as blind and buried vias, larger panel size, sequential lamination, and smaller traces and spaces have a competitive advantage over manufacturers who do not possess these technological capabilities. We believe these advanced manufacturing and production technologies are increasingly replacing and making obsolete the older technologies. Our future success will depend in large part on our ability to maintain and enhance our manufacturing capabilities and production technologies.

        Some of our competitors enjoy substantial competitive advantages, including:

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Greater financial and manufacturing resources that can be devoted to the development, production, and sale of their products;



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More established and broader sales and marketing channels;



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More manufacturing facilities worldwide, some of which are closer in proximity to our customers;



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Manufacturing facilities located in countries with lower production costs; and



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Greater name recognition.

Backlog

        Although we obtain firm purchase orders from our customers, our customers typically do not make firm orders for delivery of products more than 30 to 60 days in advance. We do not believe that the backlog of expected product sales covered by firm purchase orders is a meaningful measure of future sales prospects since orders may be rescheduled or canceled as well as the shortening life cycles of the products in the markets which we serve. Therefore, we believe that backlog information is not material to an understanding of our business.

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Governmental Regulation

        Our operations are subject to federal, state and local regulatory requirements relating to environmental compliance and site cleanups, waste management and health and safety matters. In particular, we are subject to regulations promulgated by:

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the Occupational Safety and Health Administration pertaining to health and safety in the workplace;



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the Environmental Protection Agency pertaining to the use, storage, discharge and disposal of hazardous chemicals used in the manufacturing processes; and



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corresponding state, county and city agencies.

        To date, the costs of compliance and environmental remediation have not been material to us. Nevertheless, additional or modified requirements may be imposed in the future. If such additional or modified requirements are imposed on us, or if conditions requiring remediation are found to exist, we may be required to incur substantial additional expenditures.

Employees

        As of December 31, 2002, we had 1,390 employees, none of whom are represented by unions. Of these employees, 1,271 were involved in manufacturing and engineering, 67 worked in sales and marketing, and 52 worked in accounting, systems and other support capacities. We have not experienced any labor problems resulting in a work stoppage and believe that we have good relations with our employees.

Availability of Reports Filed with the Securities and Exchange Commission

        Our Annual Reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, registration statements, and amendments to those reports are available without charge on our website, http://www.ttmtech.com/ir/sec_filings, as soon as reasonably practicable after they are filed electronically with the SEC. Copies are also available without charge by (i) telephonic request by calling our Investor Relations Department at (714) 241-0303, (ii) email request to investor@ttmtech.com, or (iii) a written request to TTM Technologies, Inc., Attention: Investor Relations, 2630 So. Harbor Blvd., Santa Ana, CA 92704.

Risk Factors That May Affect Future Results

        An investment in our common stock involves a high degree of risk. You should carefully consider the factors described below, in addition to those discussed elsewhere in this report, in analyzing an investment in our common stock. If any of the events described below occurs, our business, financial condition and results of operations would likely suffer, the trading price of our common stock could fall, and you could lose all or part of the money you paid for our common stock.

        In addition, the following risk factors and uncertainties could cause our actual results to differ materially from those projected in our forward-looking statements, whether made in this Form 10-K or the other documents we file with the SEC, or our annual or quarterly reports to shareholders, future press releases, or orally, whether in presentations, responses to questions or otherwise.

We are heavily dependent upon the electronics industry, which has suffered a significant downturn in demand resulting in excess manufacturing capacity, increased price competition, higher product inventories, decreased demand for our products and lower sales and gross margins.

        A majority of our revenues are generated from the electronics industry, which is characterized by intense competition, relatively short product life cycles and significant fluctuations in product demand.

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Furthermore, the industry is subject to economic cycles and recessionary periods and has been negatively impacted by a contraction in the U.S. economy. Moreover, due to the uncertainty in the end markets served by most of our customers, we have a low level of visibility with respect to future financial results. A lasting economic recession, continued excess manufacturing capacity or an additional decline in the electronics industry could further negatively impact our business, results of operations and financial condition. Our net sales have declined from $129.0 million in 2001 to $89.0 million in 2002. In addition, excluding the impact of Advanced Circuits in the fourth fiscal quarter 2002, we have experienced sequential declines in quarterly net sales during 2001 and 2002. A continued decline in our net sales would adversely impact our profitability and results of operations and could require us to record a valuation allowance against our deferred tax assets or recognize an impairment of our long-lived assets including goodwill and other intangible assets.

If we continue to experience excess capacity due to variability in customer demand, our gross margins may fall and/or we may have to incur restructuring charges if we choose to close any of our facilities.

        Due to recent decreases in demand, our facilities have been operating significantly below capacity. When we experience excess capacity, our sales revenues may be insufficient to fully cover our fixed overhead expenses, and our gross margins will fall. In addition, we generally schedule our quick-turn production facilities at less than full capacity to retain our ability to respond to unexpected additional quick-turn orders. However, if these orders are not made, we may forego some production and could experience continued excess capacity.

        If we believe we have significant long-term excess capacity, we may decide to permanently close one or more of our facilities and lay off some of our employees. This could result in our recording restructuring charges such as we did in the second and fourth quarters of 2002 due to the restructuring and subsequent closure of our Burlington, Washington facility.

We are dependent upon a small number of customers for a large portion of our net sales, and a decline in sales to major customers could harm our results of operations.

        A small number of customers are responsible for a significant portion of our net sales. Our 10 largest customers accounted for approximately 42% of our net sales in 2002. This concentration is expected to increase in 2003 due in part to our acquisition of Advanced Circuits which has a small number of large customers. Many of our principal customers have decreased the amount of products they purchase from us. If our customers fail to purchase products from us at past levels, it would negatively affect our business, results of operations and financial condition. We expect a significant portion of our net sales will continue to be generated by a small number of customers.

        Our customer concentration is expected to increase but could decrease depending on future customer requirements, which will depend in large part on market conditions in the electronics industry segments in which our customers participate. The loss of one or more major customers or a decline in sales to our major customers could significantly harm our business, results of operations and financial condition and lead to declines in the price of our common stock. In addition, we generate significant accounts receivable in connection with providing services to our customers. If one or more of our significant customers were to become insolvent or were otherwise unable to pay for the services provided by us, our results of operations would be harmed.

If our net earnings do not recover or we are not able to predict with a reasonable degree of probability that they will continue, we may have to record a valuation allowance against our net deferred tax assets.

        As of December 31, 2002, we had net deferred tax assets of approximately $16.3 million. If we should determine that it is more likely than not that we will not generate taxable income in sufficient

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amounts to be able to use our net deferred tax assets, we would be required to increase our valuation allowance against these net deferred tax assets. This would result in an additional income tax provision and further deteriorate our results of operations.

We are exposed to the credit risk of some of our customers and to credit exposures in weakened markets.

        Most of our sales are on an "open credit" basis, with standard industry payment terms. We monitor individual customer payment capability in granting such open credit arrangements, seek to limit such open credit to amounts we believe the customers can pay, and maintain reserves we believe are adequate to cover exposure for doubtful accounts. Some of our customers are contract manufacturers located abroad. Our concentration of these customers increased upon our acquisition of Advanced Circuits in December 2002. Our foreign sales are denominated in U.S. dollars, and are typically on the same "open credit" basis and terms described above. Our foreign receivables are expected to grow as a percentage of our total receivables. We do not utilize credit insurance as a risk management tool, but we periodically evaluate our risk management options.

        Because of the current slowdown in the global economy, our exposure to the credit risks relating to our financing activities described above has increased. Although we have programs in place to monitor and mitigate the associated risk, there can be no assurance that such programs will be effective in reducing our credit risks. There have been bankruptcies among customers causing us to incur economic or financial losses. There can be no assurance that, should economic conditions not improve, additional losses would not be incurred, and that such losses would not be material. Although these losses have not been material to date, future losses, if incurred, could harm our business and have a material adverse effect on our operating results and financial condition.

We have expanded our operations through acquisitions, and we may have trouble integrating our acquisition of Advanced Circuits and/or any future acquisitions in expanding our business. Acquisitions involve numerous risks.

        We may not be able to meet performance expectations or successfully integrate businesses we acquire, such as Advanced Circuits, on a timely basis without disrupting the quality and reliability of service to our customers or diverting management resources.

        To manage the expansion of our operations as a result of the acquisition of Advanced Circuits and any future growth, we will be required to:

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improve existing and implement new operational, financial and management information controls, reporting systems and procedures;



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integrate and consolidate different manufacturing, financial, and other computer systems that provide infrastructure support to our business in order to reduce expenses in newly acquired businesses and provide management with a consolidated view of customer and market activities;



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hire, train and manage additional qualified personnel;



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expand our direct and indirect sales channels; and



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effectively transition our relationships with our customers, suppliers and partners to operations under our TTM brand.

        We acquired Advanced Circuits in December 2002. As part of our business strategy, we expect that we will continue to grow by pursuing acquisitions, assets or product lines that complement or expand our existing business. We currently have no commitments or agreements to acquire any business. Our existing credit facility restricts our ability to acquire the assets or business of other companies and will accordingly require us to obtain the consent of our lenders and could require us to pay significant fees,

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become subject to reduced liquidity, or become subject to additional or more restrictive covenants in order to consummate such acquisitions. Consequently, we may not be able to identify suitable acquisition candidates or finance and complete transactions that we choose to pursue.

        Our acquisition of companies and businesses and expansion of operations involve risks, including the following:

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the potential inability to identify the company best suited to our company's business plan;



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the potential inability to successfully integrate acquired operations and businesses or to realize anticipated synergies, economics of scale or other expected value;



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diversion of management's attention from normal daily operations of the business;



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difficulties in managing production and coordinating operations at new sites;



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the potential inability to retain existing customers of acquired companies when we desire to do so;



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insufficient revenues to offset increased expenses associated with acquisitions;



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the potential need to restructure, modify or terminate customer relationships of the acquired company;



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an increased concentration of business from existing or new customers; and



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the potential loss of key employees of acquired operations.

        Acquisitions may cause us to:

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issue common stock that would dilute our current shareholders' percentage ownership;



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assume liabilities;



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record goodwill and non-amortizable intangible assets that will be subject to impairment testing and potential periodic impairment charges;



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incur amortization expenses related to certain intangible assets;



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incur large and immediate write-offs; or



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become subject to litigation and environmental issues.

        Acquisitions of high-technology companies are inherently risky, and no assurance can be given that our previous or future acquisitions will be successful and will not materially adversely affect our business, operating results or financial condition. Failure to manage and successfully integrate acquisitions we make could harm our business and operating results in a material way. Even when an acquired company has already developed and marketed products, there can be no assurance that product enhancements will be made in a timely fashion or that all pre-acquisition due diligence will have identified all possible issues that might arise with respect to such products.

If we are unable to respond to rapid technological change and process development, we may not be able to compete effectively.

        The market for our products is characterized by rapidly changing technology and continual implementation of new production processes. The future success of our business will depend in large part upon our ability to maintain and enhance our technological capabilities, to develop and market products that meet changing customer needs, and to successfully anticipate or respond to technological changes on a cost-effective and timely basis. We expect that the investment necessary to maintain our technological position will increase as customers make demands for products and services requiring

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more advanced technology on a quicker turnaround basis. We may not be able to raise additional funds in order to respond to technological changes as quickly as our competitors.

        In addition, the printed circuit board industry could encounter competition from new or revised manufacturing and production technologies that render existing manufacturing and production technology less competitive or obsolete. We may not respond effectively to the technological requirements of the changing market. If we need new technologies and equipment to remain competitive, the development, acquisition and implementation of those technologies and equipment may require us to make significant capital investments.

Competition in the printed circuit board market is intense, and if we are unable to compete effectively, the demand for our products may be reduced.

        The printed circuit board industry is intensely competitive, highly fragmented and rapidly changing. We expect competition to continue, which could result in price reductions, reduced gross margins and loss of market share. Our principal domestic competitors include: DDi, Endicott Interconnect Technologies, Merix, Sanmina-SCI and Tyco. In addition, new and emerging technologies may result in new competitors entering our market.

        Many of our competitors and potential competitors have a number of significant advantages over us, including:

•

greater financial and manufacturing resources that can be devoted to the development, production and sale of their products;



•

more established and broader sales and marketing channels;



•

more manufacturing facilities worldwide, some of which are closer in proximity to original equipment manufacturers;



•

manufacturing facilities which are located in countries with lower production costs; and



•

greater name recognition.

        In addition, these competitors may respond more quickly to new or emerging technologies, or may adapt more quickly to changes in customer requirements and may devote greater resources to the development, promotion and sale of their products than we do. We must continually develop improved manufacturing processes to meet our customers' needs for complex products, and our manufacturing process technology is generally not subject to significant proprietary protection. During recessionary periods in the electronics industry, our competitive advantages in the areas of providing quick-turn services, an integrated manufacturing solution and responsive customer service may be of reduced importance to our customers, who may become more price sensitive. This may force us to compete more on the basis of price and cause our margins to decline. Furthermore, printed circuit board manufacturers are currently experiencing significant overcapacity. Overcapacity, combined with the current weakness in demand for electronic products, has resulted in increased competition and price erosion for printed circuit boards.

We compete against manufacturers in Asia where production costs are lower. These competitors may gain market share in our key market segments, which may have an adverse effect on the pricing of our products.

        We may be at a competitive disadvantage with respect to price when compared to manufacturers with lower cost facilities in Asia and other locations. We believe price competition from printed circuit board manufacturers in Asia and other locations with lower production costs may play an increasing role in the market. We do not currently have offshore facilities in lower cost locations, such as Asia. While historically our competitors in these locations have produced less technologically advanced

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printed circuit boards, they continue to expand their capacity with advanced equipment to produce higher technology printed circuit boards. In addition, fluctuations in foreign currency exchange rates may benefit these offshore competitors. As a result, these competitors may gain market share, which may force us to lower our prices, reducing our gross profit.

Our results of operations are subject to fluctuations and seasonality, and because many of our operating costs are fixed, even small revenue shortfalls would decrease our gross margins and potentially cause our stock price to decline.

        Our results of operations vary for a variety of reasons, including:

•

timing of orders from and shipments to major customers;



•

the levels at which we utilize our manufacturing capacity;



•

changes in the pricing of our products or those of our competitors;



•

changes in our mix of revenues generated from quick-turn versus standard lead time production;



•

expenditures or write-offs related to acquisitions; and



•

expenses relating to expanding existing manufacturing facilities.

        A significant portion of our operating expenses is relatively fixed in nature, and planned expenditures are based in part on anticipated orders. Accordingly, recent revenue shortfalls have decreased our gross margins, and future revenue shortfalls may further decrease our gross margins. In addition, we have experienced sales fluctuations due to patterns in the capital budgeting and purchasing cycles of our customers and the end markets we serve. In particular, the seasonality of the computer industry and quick turn ordering patterns impact the overall printed circuit board industry. These seasonal trends have caused fluctuations in our quarterly operating results in the past and may continue to do so in the future. Results of operations in any period should not be considered indicative of the results to be expected for any future period. In addition, our future quarterly operating results may fluctuate and may not meet the expectations of securities analysts or investors. If this occurs, the price of our common stock would likely decline.

Because we sell on a purchase order basis, we are subject to uncertainties and variability in demand by our customers, which could decrease revenues and negatively impact our operating results.

        We sell to customers on a purchase order basis rather than pursuant to long-term contracts, and, consequently, our net sales are subject to short-term variability in demand by our customers. Customers submitting a purchase order may cancel, reduce or delay their order for a variety of reasons. The level and timing of orders placed by our customers vary due to:

•

customer attempts to manage inventory;



•

changes in customers' manufacturing strategies, such as a decision by a customer to either diversify or consolidate the number of printed circuit board manufacturers used or to manufacture their own products internally; and



•

variation in demand for our customers' products.

        We have experienced terminations, reductions and delays in our customers' orders. Further terminations, reductions or delays in our customers' orders could negatively impact our business, results of operations and financial condition.

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The increasing prominence of electronic manufacturing services providers in the printed circuit board industry could reduce our gross margins, potential sales and customers.

        In 2002, approximately 27% of our net sales were to electronic manufacturing services providers. Electronic manufacturing services providers supply electronic product assembly services to original equipment manufacturers. The growth of electronic manufacturing services providers and their global sourcing capabilities increase the purchasing power of such providers and could result in increased price competition or the loss of existing original equipment manufacturer customers. In addition, in recent years, some electronic manufacturing services providers, including a few of our customers, have acquired the ability to directly manufacture printed circuit boards. If a significant number of our other electronic manufacturing services customers were to acquire the ability to directly manufacture printed circuit boards, our customer base may shrink, and our business and net sales may decline substantially. Moreover, if any of our original equipment manufacturer customers outsource the production of printed circuit boards to these electronic manufacturing services providers, our business, results of operations and financial condition may be negatively impacted.

We may expand our business into new products and services and may not be able to compete effectively with other companies who have been in these businesses longer than we have.

        In the future, we may broaden our service offering by providing new products and services. If we do this, we will likely compete with companies that have substantially greater financial and manufacturing resources than we have and who have been providing these services longer than we have. We may not be able to successfully compete on this basis with more established competitors.

If we were to increase our amortization of definite-lived intangible assets as a result of additional acquisitions, our earnings could be negatively impacted. Similarly, if we were to revalue our existing intangible assets downward, our operating results would be harmed.

        As of December 31, 2002, our consolidated balance sheet reflected $77.0 million of intangible assets, a substantial portion of our total assets at such date. Intangible assets consist of goodwill and other identifiable intangibles relating to our July 1999 acquisition of Power Circuits. Our intangible assets may increase in future periods if we consummate other acquisitions. Amortization or impairment of these additional intangibles would, in turn, have a negative impact on earnings. In addition, we evaluate whether events and circumstances have occurred that indicate the remaining balance of intangible assets may not be recoverable. When factors indicate that assets should be evaluated for possible impairment, we may be required to reduce the carrying value of our intangible assets, which could harm our results during the periods in which such a reduction is recognized.

We rely on suppliers for the timely delivery of raw materials used in manufacturing our printed circuit boards, and an increase in industry demand or the presence of a shortage for these raw materials may increase the price of these raw materials and reduce our gross margins. Their failure to comply with our supplier requirements, such as, most notably, our product standards, could adversely affect our ability to deliver our products successfully and on time.

        To manufacture our printed circuit boards, we use raw materials such as laminated layers of fiberglass, copper foil and chemical solutions which we order from our suppliers. Although we have preferred suppliers for most of our raw materials, the materials we use are generally readily available in the open market, and numerous other potential suppliers exist. However, from time to time manufacturers of products that also use these raw materials increase their demand for these materials and, as a result, the prices of these materials increase. During these periods of increased demand, our gross margins may decrease as we have to pay more for our raw materials. If a raw material supplier fails to meet our supplier requirements, such as, most notably, our product quality standards, and consequently some of our products are unacceptable to us, this could adversely affect our net sales and

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operating profit. Suppliers may from time to time extend lead times, limit supplies or increase prices due to capacity constraints or other factors, which could adversely affect our ability to deliver our products on a timely basis.

Our manufacturing process depends on the collective industry experience of our employees in our industry. If these employees were to leave us and take this knowledge with them, our manufacturing process may suffer and we may not be able to compete effectively.

        We have limited patent or trade secret protection for our manufacturing process, but instead rely on the collective experience of our employees in the manufacturing process to ensure we continuously evaluate and adopt new technologies in our industry. Although we are not dependent on any one employee or a small number of employees, if a significant number of our employees involved in our manufacturing process were to leave our employment and we were not able to replace these people with new employees with comparable experience, our manufacturing process may suffer as we may be unable to keep up with innovations in the industry. As a result, we may not be able to continue to compete effectively.

We may be exposed to intellectual property infringement claims by third parties which could be costly to defend, could divert management's attention and resources and, if successful, could result in liability.

        We could be subject to legal proceedings and claims for alleged infringement by us of third party proprietary rights, such as patents, from time to time in the ordinary course of business. For example, in the past we were informed that our prior use of a chemical solution in our manufacturing process may have infringed upon the intellectual property rights of the holder of the patent of the chemical solution. Although no legal action has been taken against us, any claims relating to this alleged infringement, even if not meritorious, could result in costly litigation and divert management's attention and resources. In addition, if we are unsuccessful in disputing this assertion, we could be required to pay royalties or damages for our past use of the chemical solution. Similarly, we were recently advised that we have been added as a defendant in a patent infringement lawsuit filed in the U.S. District Court for the District of Arizona by Lemelson Medical, Education and Research Foundation, Limited Partnership. The suit alleges that we have infringed certain "machine vision" and other patents owned by the plaintiff and seeks injunctive relief, damages for the alleged infringements and payment of the plaintiff's attorneys' fees. If we do not prevail in any litigation as a result of such allegations, our business may be harmed.

Our business may suffer if any of our key senior executives discontinues employment with us or if we are unable to recruit and retain highly skilled engineering and sales staff.

        Our future success depends to a large extent on the services of our key managerial employees, particularly Kenton Alder, our chief executive officer. Although we have entered into employment agreements with Mr. Alder and two other executive officers, we may not be able to retain our executive officers and key personnel or attract additional qualified management in the future. Our business also depends on our continuing ability to recruit, train and retain highly qualified employees, particularly engineering and sales and marketing personnel. The competition for these employees is intense, and the loss of these employees could harm our business. Further, our ability to successfully integrate acquired companies depends in part on our ability to retain key management and existing employees at the time of the acquisition.

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Products we manufacture may contain design or manufacturing defects, which could result in reduced demand for our services and liability claims against us.

        We manufacture products to our customers' specifications, which are highly complex and may contain design or manufacturing errors or failures despite our quality control and quality assurance efforts. Defects in the products we manufacture, whether caused by a design, manufacturing or materials failure or error, may result in delayed shipments, customer dissatisfaction, or a reduction or cancellation of purchase orders. If these defects occur either in large quantities or too frequently, our business reputation may be impaired. Since our products are used in products that are integral to our customers' businesses, errors, defects or other performance problems could result in financial or other damages to our customers beyond the cost of the printed circuit board, for which we may be liable. Although our invoices and sales arrangements generally contain provisions designed to limit our exposure to product liability and related claims, existing or future laws or unfavorable judicial decisions could negate these limitation of liability provisions. Product liability litigation against us, even if it were unsuccessful, would be time consuming and costly to defend.

Our failure to comply with the requirements of environmental laws could result in fines and revocation of permits necessary to our manufacturing processes.

        Our operations are regulated under a number of federal, state and foreign environmental and safety laws and regulations that govern, among other things, the discharge of hazardous materials into the air and water, as well as the handling, storage and disposal of such materials. These laws and regulations include the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act, and the Comprehensive Environmental Response, Compensation and Liability Act, as well as analogous state and foreign laws. Compliance with these environmental laws is a major consideration for us because our manufacturing processes use and generate materials classified as hazardous such as ammoniacal etching solutions, copper and nickel. Because we use hazardous materials and generate hazardous wastes in our manufacturing processes, we may be subject to potential financial liability for costs associated with the investigation and remediation of our own sites, or sites at which we have arranged for the disposal of hazardous wastes, if such sites become contaminated. Even if we fully comply with applicable environmental laws and are not directly at fault for the contamination, we may still be liable. The wastes we generate include spent ammoniacal etching solutions, metal stripping solutions and hydrochloric acid solution containing palladium; waste water which contains heavy metals, acids, cleaners and conditioners; and filter cake from equipment used for on-site waste treatment. We believe that our operations substantially comply with all applicable environmental laws. However, any material violations of environmental laws by us could subject us to revocation of our effluent discharge permits. Any such revocations could require us to cease or limit production at one or more of our facilities, negatively impacting our business, results of operations and financial condition. Even if we ultimately prevail, environmental lawsuits against us would be time consuming and costly to defend.

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        Environmental laws could also become more stringent over time, imposing greater compliance costs and increasing risks and penalties associated with violation. We operate in environmentally sensitive locations and we are subject to potentially conflicting and changing regulatory agendas of political, business and environmental groups. Changes or restrictions on discharge limits, emissions levels, material storage, handling or disposal might require a high level of unplanned capital investment and/or relocation. It is possible that environmental compliance costs and penalties from new or existing regulations may harm our business, results of operations and financial condition.

Our indebtedness could adversely affect our financial health, and the restrictions imposed by the terms of our debt instruments may severely limit our ability to plan for or respond to changes in our business.

        At December 31, 2002, we had $10.0 million of term loan indebtedness. In addition, subject to the restrictions under our various debt agreements, we may incur additional revolving loan indebtedness from time to time to finance acquisitions or capital expenditures or for other purposes.

        Our level of debt could have negative consequences. For example, it could:

•

require us to dedicate a substantial portion of our cash flow from operations to repayment of debt, limiting the availability of cash for other purposes;



•

increase our vulnerability to adverse general economic conditions by making it more difficult to borrow additional funds to maintain our operations if we suffer revenue shortfalls;



•

hinder our flexibility in planning for, or reacting to, changes in our business and industry by preventing us from borrowing money to upgrade our equipment or facilities; and



•

limit or impair our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions or general corporate purposes.

Our major shareholder has significant influence over our business and could delay, deter or prevent a change of control or other business combination.

        As of December 31, 2002, Circuit Holdings held approximately 39.4% of our outstanding stock. Thayer Capital Partners controls three entities that together own approximately 60.0% of Circuit Holdings and beneficially own approximately 46.0% of our shares. In addition, two of our directors are representatives of Thayer Capital Partners. Although Thayer Capital does not currently own any interests in our direct competitors, the interests of Thayer Capital Partners may not always coincide with our interests or those of our other shareholders, particularly if Thayer Capital decided to sell its controlling interest in us. By virtue of its stock ownership and board representation, Thayer Capital Partners will continue to have a significant influence over all matters submitted to our board and our shareholders, including the election of our directors, and will be able to exercise significant control over our business, policies and affairs. Through its voting power, Thayer Capital Partners could cause us to take actions that we would not consider absent its influence, or could delay, deter or prevent a change of control of our company or other business combination that might otherwise be beneficial to our public shareholders.

        In addition, Thayer Capital Partners has historically worked closely with Brockway Moran & Partners, Inc. Brockway Moran & Partners Fund, L.P. owns the remaining 40% of Circuit Holdings. In addition, one of our directors is a representative of Brockway Moran & Partners. Although there is no legal agreement requiring Thayer Capital Partners and Brockway Moran & Partners to vote their shares together or for their representatives on our board to vote together, given their relationship in the past these two entities may continue to work together, in which case they would control our board and exercise voting control over approximately 48.0% of our shares that are beneficially owned by such entities.

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The market price of our common stock has been depressed, and may decline further. We expect the trading price of our common stock to be highly volatile.

        The market price of our common stock has fluctuated significantly and generally declined, from $23.88 per share on October 22, 2000 to $1.20 per share on October 10, 2002. The market price of our common stock may decline further as a result of a number of factors. Factors that could cause fluctuations in the market price of our common stock include:

•

actual and anticipated variations in our operating results;



•

general economic and market conditions;



•

interest rates;



•

geo-political conditions throughout the world;



•

general conditions, including changes in demand in the printed circuit board industry and the end markets which it serves;



•

perceptions of the strengths and weaknesses of the printed circuit board industry and the end markets which it serves;



•

our ability to pay principal and interest on our debt when due;



•

developments in our relationships with our lenders, customers, and/or suppliers;



•

announcements of alliances, mergers or other relationships by or between our competitors and/or our suppliers and customers;



•

announcements of plant closings, layoffs, restructurings or bankruptcies by our competitors; and



•

developments related to regulations, including environmental and wastewater regulations.

        We expect this volatility to continue in the future. In addition, any shortfall or changes in our revenue, gross margins, earnings or other financial results could also cause the price of our common stock to fluctuate significantly. In recent years, and particularly in June and July 2002, the stock market in general has experienced extreme price and volume fluctuations that have affected the printed circuit board industry and that may be unrelated to the operating performance of the companies within these industries. These broad market fluctuations may adversely affect the market price of our common stock.

ITEM 2. PROPERTIES

        Our principal manufacturing facilities are as follows:

        We own all of our manufacturing and administrative office facilities. Our owned facilities are subject to mortgages under our senior credit facility.

        While we own our facility in Burlington, Washington, we operate it under a land lease that expires in July 2025. In connection with a restructuring charge taken in the fourth quarter of 2002, we have closed our Burlington, Washington facility and have listed it for sale. We also lease a sales office in Hopkins, Minnesota. This sales office contains approximately 8,700 square feet and the lease expires in March 2004.

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        We believe our facilities are currently adequate for our operating needs. We are qualified under various standards, including UL (Underwriters Laboratories) approval for electronics. In addition, all of our manufacturing and administrative office facilities are ISO 9002 certified. These certifications require that we meet standards related to management, production and quality control, among others.

ITEM 3. LEGAL PROCEEDINGS

        From time to time we may become a party to various legal proceedings arising in the ordinary course of our business. We were recently advised that we have been added as a defendant in a patent infringement lawsuit filed in the U.S. District Court for the District of Arizona by Lemelson Medical, Education and Research Foundation, Limited Partnership. The suit alleges that we have infringed certain "machine vision" and other patents owned by the plaintiff and seeks injunctive relief, damages for the alleged infringements and payment of the plaintiff's attorneys' fees. Although the ultimate outcome of this matter is not currently determinable, we believe we have meritorious defenses to these allegations and, based in part on the licensing terms offered by the Lemelson Partnership, do not expect this litigation to materially impact our business, results of operations or financial condition. However, there can be no assurance that the ultimate resolution of this matter will not have a material adverse effect on our results of operations for any quarter. Furthermore, there can be no assurance that we will prevail in any such litigation.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

        Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

        Our common stock has been listed on the Nasdaq National Market under the symbol "TTMI" since September 21, 2000. The following table sets forth the quarterly high and low closing prices of our common stock as reported on the Nasdaq National Market for the periods indicated.

        As of February 28, 2003, there were approximately 531 holders of record of our common stock. The closing sale price of our common stock on the Nasdaq National Market on March 18, 2003 was $4.70 per share.

        We did not declare or pay any dividends for the year ended December 31, 2000, December 31, 2001 or December 31, 2002, and we do not anticipate paying any cash dividends in the foreseeable future. Additionally, our senior credit facility prohibits the payment of dividends. We presently intend to retain any future earnings to finance future operations and expansion of our business, and to reduce indebtedness.

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ITEM 6. SELECTED FINANCIAL DATA

        The selected historical financial data presented below are derived from our consolidated financial statements. The selected financial data should be read in conjunction with Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the notes thereto included elsewhere in this report. All share amounts and per share data have been adjusted to reflect the 380-for-one split of our common stock effected in September 2000.