HTI Earnings and Flood Recovery at Thailand Plant 25 Apr 12

Hutchinson Technology Incorporated is reporting a net loss of $7.5 million, or $0.32 per share, on net sales of $65.5 million for its fiscal second quarter ended March 25, 2012.

The net loss for the quarter included: $11.3 million of flood insurance recoveries, offset by $2.4 million of flood-related restoration and operating costs in Thailand;

$3.5 million of debt refinancing costs; and $1.7 million of non-cash interest expense resulting from the accounting for convertible debt instruments.

Excluding those items, the company’s non-GAAP net loss for its fiscal second quarter totaled $11.2 million, or $0.48 per share.

In the preceding quarter, the company reported a net loss of $12.5 million, or $0.53 per share, on net sales of $58.5 million. Excluding certain items, the non-GAAP net loss in the preceding quarter totaled $11.5 million or $0.49 per share.

The company’s fiscal 2012 second quarter suspension assembly shipments totaled 96.9 million, up 9% compared with the first quarter and in line with its expectations.

President and CEO Wayne Fortun says suspension assembly demand is increasing as the disk drive supply chain recovers from the October 2011 Thailand flood and U.S. Operations are helping to meet customers’ requirements and responding to increasing demand.

Fortun says the company’s assembly operation in Thailand is on schedule to resume production by the end of June and return to pre-flood capacity by the middle of fiscal 2013. The company estimates it will spend approximately $30 million in the current fiscal year and an additional $5 million in fiscal 2013 to restore its Thai assembly operation to pre-flood capacity levels and to cover the incremental costs of manufacturing in the U.S. during the recovery period.