Hutchinson Technology Reports Fourth Quarter Results as Low Manufacturing Yields Contribute to Loss
Company officials say suspension assembly shipments of 102.6 million for its fiscal fourth quarter ended September 29, 2013, up from 99.3 million in the preceding quarter. The company reported a net loss of $14.6 million, or $0.53 per share, on net sales of $63.7 million. The net loss for the fiscal 2013 fourth quarter included a $1.7 million impairment of BioMeasurement inventory, $900,000 of site consolidation costs, $800,000 of non-cash interest expense and a $100,000 foreign currency loss. Excluding those items, the company’s fiscal 2013 fourth quarter net loss totaled $11.0
million, or $0.40 per share.
In the preceding quarter, the company reported a net loss of $15.9
million, or $0.59 per share, on net sales of $61.3 million.
The company incurred a gross loss of $400,000, or 1% of net sales, in
the fiscal 2013 fourth quarter, compared with a gross profit of $1.4
million, or 2% of net sales, in the preceding quarter.
“While we resolved the previously reported process issues encountered
in our third quarter, we missed our operational targets in two areas
during the fourth quarter,” said Rick Penn, Hutchinson Technology’s
president and chief executive officer. “At our Thailand assembly
operation, the aggressive ramp, combined with a heavier mix of new
dual-stage actuated (DSA) programs, put pressure on our yields and
efficiencies and caused them to come in lower than planned. We have
intensified our support and expect improved operational performance as
we ramp additional programs and continue to transition more assembly
production to Thailand.” Penn said the company also experienced low
yields in the last month of the quarter from a manufacturing issue in
its components operation that has since been corrected. He noted that
neither of the issues impacted suspension assembly shipments to
customers. “Although we are disappointed with these manufacturing
issues, we have addressed them and are confident our operational
performance will improve going forward,” said Penn.