Hutchinson Technology Incorporated is reporting a net loss of $7.2 million, or $0.31 per share, on net sales of $74.4 million for its fiscal fourth quarter ended September 25th, 2011.
Company officials say the results for the quarter included:
A gain on debt extinguishment of $2.9 million related to the previously announced exchange offer that was completed in July 2011 for $46.0 million of its 3.25% Convertible Subordinated Notes as well as non-cash interest expense and consolidation expenses.
Excluding these items, the company’s net loss for its fiscal 2011 fourth quarter totaled $7.9 million, or $0.34 per share.
In the preceding quarter, the company reported a net loss of $10.9 million, or $0.47 per share, on net sales of $72.2 million.
Meanwhile, severe flooding in Thailand continues, which caused the company to suspend assembly operations at its Thailand facility in early October. Wayne M. Fortun, Hutchinson Technology’s president and chief executive officer says although they believe it will take multiple quarters, HTI fully intends to resume operations in Thailand. Fortun says the operation in Thailand was meeting or exceeding expectations for volume, quality and costs and remains integral to enabling the company to become the industry’s lowest cost producer of suspension assemblies.
HTI is leveraging its U.S. assembly operations to offset the temporary loss of capacity in Thailand.
In addition to the impact on the company’s operations, the flooding in Thailand is constraining the overall capacity of the hard disk drive supply chain. The resulting reduction in disk drive production is expected to result in a material decrease in demand for suspension assemblies in the company’s fiscal 2012 first quarter, and the company estimates that its first quarter shipments will be 80 million to 100 million.