TowerJazz (NASDAQ: TSEM & TASE: TSEM) reported today its
results for the third quarter ended September 30, 2019.
Third Quarter Results
OverviewRevenues for the third quarter of
2019 were $312 million, as compared to $306 million in the prior
quarter, reflecting 4% organic growth (defined as total revenue
excluding revenues from Panasonic in the TPSCo fabs and revenues
from Maxim in the San Antonio fab), and compared to revenues of
$323 million for the third quarter of 2018, reflecting 11% organic
growth year over year.
Gross and operating
profits for the third quarter of 2019 were $58 million and
$23 million, respectively, an increase of $5 million as compared to
$53 million and $18 million, respectively, in the prior quarter.
Gross and operating profits for the third quarter of 2018 were $73
million and $39 million, respectively.
EBITDA for the third quarter of
2019 was $75 million, an increase of $5 million as compared to $70
million in the prior quarter. EBITDA for the third quarter of 2018
was $89 million.
Net profit for the third
quarter of 2019 was $22 million, or $0.21 diluted earnings per
share, as compared to $21 million or $0.20 diluted earnings per
share in the prior quarter. Net profit for the third quarter of
2018 was $34 million, or $0.33 diluted earnings per share.
Cash flow generated from
operations was $73 million as compared with $72 million in
the prior quarter and $69 million in the third quarter of 2018. The
company invested $43 million in fixed assets, net and retired $6
million of debt during the third quarter of 2019.
Shareholders' equity as of
September 30, 2019 was a record of $1.32 billion, as compared to
$1.24 billion as of December 31, 2018, reflecting 69% from total
assets.
Business OutlookTowerJazz
expects revenues for the fourth quarter of 2019 of approximately
$312 million, with an upward or downward range of 5%.
Mr. Russell Ellwanger, Chief Executive
Officer of TowerJazz, commented, “In
addition to posting solid quarter results, we made significant
progress on various fronts including strong activities furthering
our accretive growth strategies, and also in each of our business
units – for example contracts in advanced display and micro display
and 300mm CMOS industrial sensors, key end customer qualification
with our SiPho platform, and continued qualifications of our RFSOI
and CIS back-side illumination (BSI) 300mm and 200mm advanced
roadmaps. These should bear fruits through the year 2020 and
beyond. Our 300mm Uozu capacity expansion plan is on track,
additionally having decided to build in-house capacity for strongly
differentiated BSI and in particular BSI stacked wafer CIS
processes. We look forward to 2020, during which the capacity ramp
together with the aforementioned business activities and additional
initiatives should come into play, resulting in growing
financials.”
Teleconference and
WebcastTowerJazz will host an investor conference call
today, Wednesday, November 13, 2019, at 10:00a.m. Eastern time
(9:00a.m. Central time, 8:00a.m. Mountain Time, 7:00a.m. Pacific
Time and 5:00p.m. Israel time). Management will discuss the
Company’s financial results for the third quarter of 2019 and
present its outlook.
This call will be webcast and can be accessed
via TowerJazz’s website at www.towerjazz.com, or can also be
accessed by calling the following numbers: U.S. Toll Free:
1-888-407-2553; Israel: 03-918-0610; International:
+972-3-918-0610. The teleconference will be available for replay
for 90 days.
The Company presents its financial statements in
accordance with U.S. GAAP. The financial information included
in the tables below includes unaudited condensed financial data.
Some of the financial information in this release and/ or in
related public disclosures or filings with respect to the financial
statements and/ or results of the Company, which we describe in
this release as “adjusted” financial measures, is non-GAAP
financial measures as defined in Regulation G and related reporting
requirements promulgated by the Securities and Exchange Commission
as they apply to our Company. These adjusted financial measures are
calculated excluding one or more of the following: (1) amortization
of acquired intangible assets and (2) compensation expenses in
respect of equity grants to directors, officers and employees.
These adjusted financial measures should be evaluated in
conjunction with, and are not a substitute for, GAAP financial
measures. The tables also present the GAAP financial measures,
which are most comparable to the adjusted financial measures, as
well as a reconciliation between the adjusted financial measures
and the comparable GAAP financial measures. As used and/ or
presented in this release and/ or in related public disclosures or
filings with respect to the financial statements and/ or results of
the Company, as well as calculated in the tables herein, the term
Earnings Before Interest Tax Depreciation and Amortization (EBITDA)
consists of net profit in accordance with GAAP, excluding interest
and other financing expense, net, other income, net, taxes,
non-controlling interest, depreciation and amortization expense and
stock-based compensation expense. EBITDA is reconciled in the
tables below from GAAP operating profit. EBITDA is not a required
GAAP financial measure and may not be comparable to a similarly
titled measure employed by other companies. EBITDA and the adjusted
financial information presented herein and/ or in related public
disclosures or filings with respect to the financial statements
and/ or results of the Company, should not be considered in
isolation or as a substitute for operating profit, net profit or
loss, cash flows provided by operating, investing and financing
activities, per share data or other profit or cash flow statement
data prepared in accordance with GAAP. The term Net Cash, as used
and/ or presented in this release and/ or in related public
disclosures or filings with respect to the financial statements
and/ or results of the Company, is comprised of cash, cash
equivalents, short-term deposits and marketable securities less
debt amounts as presented in the balance sheets included herein.
The term Net Cash is not a required GAAP financial measure, may not
be comparable to a similarly titled measure employed by other
companies and should not be considered in isolation or as a
substitute for cash, debt, operating profit, net profit or loss,
cash flows provided by operating, investing and financing
activities, per share data or other profit or cash flow statement
data prepared in accordance with GAAP. The term Free Cash Flow, as
used and/ or presented in this release and/ or in related public
disclosures or filings with respect to the financial statements
and/ or results of the Company, is calculated to be cash from
operating activities (in the amounts of $73 million, $72 million
and $69 million for the three months periods ended September 30,
2019, June 30, 2019 and September 30, 2018, respectively and in the
amounts of $220 million and $221 million for the nine months
periods ended September 30, 2019 and September 30, 2018,
respectively) less cash for investments in property and equipment,
net (in the amounts of $43 million, $44 million and $41 million for
the three months periods ended September 30, 2019, June 30, 2019
and September 30, 2018, respectively and in the amounts of $128
million and $121 million for the nine months periods ended
September 30, 2019 and September 30, 2018, respectively). The term
Free Cash Flow is not a required GAAP financial measure, may not be
comparable to a similarly titled measure employed by other
companies and should not be considered in isolation or as a
substitute for operating profit, net profit or loss, cash flows
provided by operating, investing and financing activities, per
share data or other profit or cash flow statement data prepared in
accordance with GAAP. With regards to our balance sheet as of
September 30, 2019, as disclosed in Note 2Y to our annual financial
statements for the year ended December 31, 2018, we implemented ASU
2016-02 “Leases” effective January 1, 2019 with regards to lease
right-of-use assets and lease liabilities, which implementation
resulted in our lease contracts value presentation under property
and equipment, net, short-term debt and long-term debt as of
September 30, 2019. In addition, short-term debt as of September
30, 2019 includes $37 million of the first and second installment
payments scheduled in March and September 2020 for series G
bonds.
About TowerJazzTower
Semiconductor Ltd. (NASDAQ: TSEM, TASE: TSEM) and its subsidiaries
operate collectively under the brand name TowerJazz, the global
specialty foundry leader. TowerJazz manufactures next-generation
integrated circuits (ICs) in growing markets such as consumer,
industrial, automotive, medical and aerospace and defense.
TowerJazz’s advanced technology is comprised of a broad range of
customizable process platforms such as: SiGe, BiCMOS,
mixed-signal/CMOS, RF CMOS, CMOS image sensor, integrated power
management (BCD and 700V), and MEMS. TowerJazz also provides
world-class design enablement for a quick and accurate design cycle
as well as Transfer Optimization and development Process Services
(TOPS) to IDMs and fabless companies that need to expand capacity.
To provide multi-fab sourcing and extended capacity for its
customers, TowerJazz operates two manufacturing facilities in
Israel (150mm and 200mm), two in the U.S. (200mm) and three
facilities in Japan (two 200mm and one 300mm) through its
partnership with Panasonic Semiconductor Solutions Co. LTD. For
more information, please visit: www.towerjazz.com.
CONTACTS: Noit Levy | TowerJazz | +972 4 604
7066 | Noit.levi@towerjazz.comGK Investor Relations | Gavriel
Frohwein, +1 (646) 688 3559 | towerjazz@gkir.com
This press release includes forward-looking
statements, which are subject to risks and uncertainties. Actual
results may vary from those projected or implied by such
forward-looking statements and you should not place any undue
reliance on such forward-looking statements. Potential risks and
uncertainties include, without limitation, risks and uncertainties
associated with: (i) demand in our customers’ end markets; (ii)
over demand for our foundry services and/or products that exceeds
our capacity; (iii) maintaining existing customers and attracting
additional customers, (iv) high utilization and its effect on cycle
time, yield and on schedule delivery which may cause customers to
transfer their product(s) to other fabs, (v) operating results
fluctuate from quarter to quarter making it difficult to predict
future performance, (vi) impact of our debt and other liabilities
on our financial position and operations, (vii) our ability to
successfully execute acquisitions, integrate them into our
business, utilize our expanded capacity and find new business,
(viii) fluctuations in cash flow, (ix) our ability to satisfy the
covenants stipulated in our agreements with our lender banks and
bondholders (as of September 30, 2019 we are in compliance with all
such covenants included in our banks’ agreements, bond G indenture
and others), (x) pending litigation, (xi) new customer engagements,
qualification and production ramp-up at our facilities, including
TPSCo and the San Antonio facility, (xii) meeting the conditions
set in the approval certificates received from the Israeli
Investment Center under which we received a significant amount of
grants in past years, (xiii) receipt of orders that are lower than
the customer purchase commitments, (xiv) failure to receive orders
currently expected, (xv) possible incurrence of additional
indebtedness, (xvi) effect of global recession, unfavorable
economic conditions and/or credit crisis, (xvii) our ability to
accurately forecast financial performance, which is affected by
limited order backlog and lengthy sales cycles, (xviii) possible
situations of obsolete inventory if forecasted demand exceeds
actual demand when we manufacture products before receipt of
customer orders, (xix) the cyclical nature of the semiconductor
industry and the resulting periodic overcapacity, fluctuations in
operating results and future average selling price erosion, (xx)
the execution of debt re-financing and/or fundraising to enable the
service of our debt and/or other liabilities, (xxi) operating our
facilities at high utilization rates which is critical in order to
cover a portion or all of the high level of fixed costs associated
with operating a foundry, and our debt, in order to improve our
results, (xxii) the purchase of equipment to increase capacity, the
timely completion of the equipment installation, technology
transfer and raising the funds therefor, (xxiii) the concentration
of our business in the semiconductor industry, (xxiv) product
returns, (xxv) our ability to maintain and develop our technology
processes and services to keep pace with new technology, evolving
standards, changing customer and end-user requirements, new product
introductions and short product life cycles, (xxvi) competing
effectively, (xxvii) use of outsourced foundry services by both
fabless semiconductor companies and integrated device
manufacturers; (xxviii) achieving acceptable device yields, product
performance and delivery times, (xxix) our dependence on
intellectual property rights of others, our ability to operate our
business without infringing others’ intellectual property rights
and our ability to enforce our intellectual property against
infringement, (xxx) our fab3 landlord’s construction project
adjacent to our fabrication facility, including possible temporary
reductions or interruptions in the supply of utilities and/ or fab
manufacturing, as well as claims that our noise abatement efforts
are not adequate under the terms of the amended lease; (xxxi)
retention of key employees and recruitment and retention of skilled
qualified personnel, (xxxii) exposure to inflation, currency rates
(mainly the Israeli Shekel and Japanese Yen) and interest rate
fluctuations and risks associated with doing business locally and
internationally, as well fluctuations in the market price of our
traded securities, (xxxiii) issuance of ordinary shares as a result
of conversion and/or exercise of any of our convertible securities,
as well as any sale of shares by any of our shareholders, or any
market expectation thereof, which may depress the market price of
our ordinary shares and may impair our ability to raise future
capital, (xxxiv) meeting regulatory requirements worldwide,
including environmental and governmental regulations,; (xxxv)
negotiation and closure of a definitive agreement in relation to
fab establishment in China, as well as project implementation
through required outside funding and resources and receipt of
future proceeds therefrom, and (xxxvi) business interruption due to
fire and other natural disasters, the security situation in Israel
and other events beyond our control such as power
interruptions.
A more complete discussion of risks and
uncertainties that may affect the accuracy of forward-looking
statements included in this press release or which may otherwise
affect our business is included under the heading "Risk Factors" in
Tower’s most recent filings on Forms 20-F and 6-K, as were filed
with the Securities and Exchange Commission (the “SEC”) and the
Israel Securities Authority. Future results may differ materially
from those previously reported. The Company does not intend to
update, and expressly disclaims any obligation to update, the
information contained in this release.
(Financial tables follow)
|
TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
December 31, |
|
|
|
|
|
|
|
2019 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
(unaudited) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A S S E T S |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
417,636 |
$ |
405,158 |
$ |
385,091 |
|
|
Short-term deposits |
|
|
159,230 |
|
147,032 |
|
120,079 |
|
|
Marketable securities |
|
|
146,264 |
|
146,893 |
|
135,850 |
|
|
Trade accounts receivable |
|
123,519 |
|
123,789 |
|
153,409 |
|
|
Inventories |
|
|
187,902 |
|
174,806 |
|
170,778 |
|
|
Other current assets |
|
|
21,571 |
|
22,374 |
|
22,752 |
|
|
|
Total current assets |
|
|
1,056,122 |
|
1,020,052 |
|
987,959 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM INVESTMENTS |
|
36,662 |
|
36,874 |
|
35,945 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT, NET |
|
703,569 |
|
707,122 |
|
657,234 |
|
|
|
|
|
|
|
|
|
|
|
|
|
INTANGIBLE ASSETS, NET |
|
10,800 |
|
11,279 |
|
13,435 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GOODWILL |
|
|
7,000 |
|
7,000 |
|
7,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
DEFERRED TAX AND OTHER LONG-TERM ASSETS, NET |
90,269 |
|
89,171 |
|
88,404 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
1,904,422 |
$ |
1,871,498 |
$ |
1,789,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
Short-term debt |
|
$ |
64,774 |
$ |
45,173 |
$ |
10,814 |
|
|
Trade accounts payable |
|
|
104,366 |
|
92,747 |
|
104,329 |
|
|
Deferred revenue and customers' advances |
|
6,539 |
|
7,975 |
|
20,711 |
|
|
Other current liabilities |
|
|
59,065 |
|
65,904 |
|
67,867 |
|
|
|
Total current liabilities |
|
234,744 |
|
211,799 |
|
203,721 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM DEBT |
|
|
254,683 |
|
275,914 |
|
256,669 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM CUSTOMERS' ADVANCES |
|
32,843 |
|
27,230 |
|
28,131 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM EMPLOYEE RELATED LIABILITIES |
|
13,818 |
|
14,295 |
|
13,898 |
|
|
|
|
|
|
|
|
|
|
|
|
|
DEFERRED TAX AND OTHER LONG-TERM LIABILITIES |
45,598 |
|
47,403 |
|
51,353 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
581,686 |
|
576,641 |
|
553,772 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL SHAREHOLDERS' EQUITY |
|
1,322,736 |
|
1,294,857 |
|
1,236,205 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
|
$ |
1,904,422 |
$ |
1,871,498 |
$ |
1,789,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
current ratio |
|
4.50 |
|
4.82 |
|
4.85 |
|
|
|
|
|
net current assets |
|
821,315 |
|
808,253 |
|
784,238 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) |
(dollars and share count in thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
|
|
|
|
|
|
September 30, |
June 30, |
|
September 30, |
|
|
|
|
|
|
|
|
2019 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES |
|
|
$ |
312,122 |
|
$ |
306,064 |
$ |
322,596 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF REVENUES |
|
|
253,841 |
|
|
252,657 |
|
249,975 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
|
58,281 |
|
|
53,407 |
|
72,621 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
18,722 |
|
|
18,812 |
|
18,236 |
|
|
Marketing, general and administrative |
|
16,840 |
|
|
16,838 |
|
15,826 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
35,562 |
|
|
35,650 |
|
34,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING PROFIT |
|
22,719 |
|
|
17,757 |
|
38,559 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCING AND OTHER INCOME (EXPENSE), NET |
|
(426 |
) |
|
947 |
|
(2,497 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE INCOME TAX |
|
22,293 |
|
|
18,704 |
|
36,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME TAX BENEFIT (EXPENSE), NET |
|
61 |
|
|
1,018 |
|
(2,388 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE NON CONTROLLING INTEREST |
|
22,354 |
|
|
19,722 |
|
33,674 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON CONTROLLING INTEREST |
|
(166 |
) |
|
1,214 |
|
(28 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET PROFIT |
|
$ |
22,188 |
|
$ |
20,936 |
$ |
33,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC EARNINGS PER SHARE |
$ |
0.21 |
|
$ |
0.20 |
$ |
0.34 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares |
|
106,644 |
|
|
106,321 |
|
100,158 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
DILUTED EARNINGS PER SHARE |
$ |
0.21 |
|
$ |
0.20 |
$ |
0.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit used for diluted earnings per
share |
$ |
22,188 |
|
$ |
20,936 |
$ |
33,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares |
|
107,601 |
|
|
107,178 |
|
102,083 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION FROM GAAP NET PROFIT TO ADJUSTED NET
PROFIT: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP NET PROFIT |
|
$ |
22,188 |
|
$ |
20,936 |
$ |
33,646 |
|
|
|
Stock based compensation |
|
3,775 |
|
|
3,884 |
|
2,710 |
|
|
|
Amortization of acquired intangible assets |
|
492 |
|
|
494 |
|
1,627 |
|
|
ADJUSTED NET PROFIT |
$ |
26,455 |
|
$ |
25,314 |
$ |
37,983 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED EARNINGS PER SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
$ |
0.25 |
|
$ |
0.24 |
$ |
0.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
$ |
0.25 |
|
$ |
0.24 |
$ |
0.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) |
(dollars and share count in thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended |
|
|
|
|
|
|
|
|
|
September 30, |
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES |
|
|
$ |
928,293 |
|
$ |
970,444 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF REVENUES |
|
|
753,454 |
|
|
753,130 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
|
174,839 |
|
|
217,314 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
56,702 |
|
|
54,675 |
|
|
|
Marketing, general and administrative |
|
50,319 |
|
|
47,935 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
107,021 |
|
|
102,610 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING PROFIT |
|
67,818 |
|
|
114,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCING AND OTHER INCOME (EXPENSE), NET |
|
1,247 |
|
|
(11,719 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE INCOME TAX |
|
69,065 |
|
|
102,985 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME TAX EXPENSE, NET |
|
(588 |
) |
|
(6,121 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE NON CONTROLLING INTEREST |
|
68,477 |
|
|
96,864 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON CONTROLLING INTEREST |
|
864 |
|
|
642 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET PROFIT |
|
$ |
69,341 |
|
$ |
97,506 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC EARNINGS PER SHARE |
$ |
0.65 |
|
$ |
0.98 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares |
|
106,103 |
|
|
99,186 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DILUTED EARNINGS PER SHARE |
$ |
0.65 |
|
$ |
0.96 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit used for diluted earnings per
share |
$ |
69,341 |
|
$ |
97,506 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares |
|
107,252 |
|
|
101,424 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION FROM GAAP NET PROFIT TO ADJUSTED NET
PROFIT: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP NET PROFIT |
|
$ |
69,341 |
|
$ |
97,506 |
|
|
|
|
Stock based compensation |
|
11,482 |
|
|
8,755 |
|
|
|
|
Amortization of acquired intangible assets |
|
2,627 |
|
|
4,940 |
|
|
|
ADJUSTED NET PROFIT |
$ |
83,450 |
|
$ |
111,201 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED EARNINGS PER SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
$ |
0.79 |
|
$ |
1.12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
$ |
0.78 |
|
$ |
1.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIES |
RECONCILIATION FROM GAAP OPERATING PROFIT TO EBITDA
(UNAUDITED) |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
September 30, |
|
|
|
|
|
|
|
|
2019 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP OPERATING PROFIT |
$ |
22,719 |
$ |
17,757 |
$ |
38,559 |
|
|
Depreciation of fixed assets |
|
48,355 |
|
47,966 |
|
46,172 |
|
|
Stock based compensation |
|
3,775 |
|
3,884 |
|
2,710 |
|
|
Amortization of acquired intangible assets |
|
492 |
|
494 |
|
1,627 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
|
$ |
75,341 |
$ |
70,101 |
$ |
89,068 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIES |
CONSOLIDATED SOURCES AND USES REPORT
(UNAUDITED) |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
|
September 30, |
|
June 30, |
|
September 30, |
|
|
|
2019 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS - BEGINNING OF
PERIOD |
$ |
405,158 |
|
$ |
408,098 |
|
$ |
486,880 |
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
72,735 |
|
|
72,156 |
|
|
69,471 |
|
|
Investments in property and equipment, net |
|
(43,017 |
) |
|
(43,727 |
) |
|
(40,892 |
) |
|
Exercise of options, net |
|
43 |
|
|
-- |
|
|
21 |
|
|
Debt repaid, net |
|
(5,606 |
) |
|
(7,475 |
) |
|
(43,078 |
) |
|
Effect of Japanese Yen exchange rate change over cash
balance |
|
(104 |
) |
|
3,205 |
|
|
(3,057 |
) |
|
Investments in short-term deposits, marketable securities
and other assets, net |
(11,573 |
) |
|
(27,099 |
) |
|
(4,899 |
) |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS - END OF PERIOD |
$ |
417,636 |
|
$ |
405,158 |
|
$ |
464,446 |
|
|
|
|
|
|
|
|
|
FREE CASH FLOW |
$ |
29,718 |
|
$ |
28,429 |
|
$ |
28,579 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended |
|
|
|
|
|
September 30, |
|
September 30, |
|
|
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS - BEGINNING OF
PERIOD |
$ |
385,091 |
|
$ |
445,961 |
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
219,759 |
|
|
221,401 |
|
|
|
Investments in property and equipment, net |
|
(128,462 |
) |
|
(121,087 |
) |
|
|
Exercise of options, net |
|
440 |
|
|
705 |
|
|
|
Debt repaid, net |
|
(16,155 |
) |
|
(45,925 |
) |
|
|
Effect of Japanese Yen exchange rate change over cash
balance |
|
2,361 |
|
|
(1,259 |
) |
|
|
Investments in short-term deposits, marketable securities
and other assets, net |
(45,398 |
) |
|
(35,350 |
) |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS - END OF PERIOD |
$ |
417,636 |
|
$ |
464,446 |
|
|
|
|
|
|
|
|
|
FREE CASH FLOW |
$ |
91,297 |
|
$ |
100,314 |
|
|
|
|
|
|
|
|
|
|
TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED) |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
|
|
|
|
|
September 30, |
June 30, |
|
September 30, |
|
|
|
|
|
|
|
2019 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS - OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit for the period |
$ |
22,354 |
|
$ |
19,722 |
|
$ |
33,674 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net profit for the
period |
|
|
|
|
|
|
|
|
to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
Income and expense items not involving cash
flows: |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
53,203 |
|
|
52,853 |
|
|
52,764 |
|
|
|
|
|
Effect of exchange rate differences on
debentures |
|
3,095 |
|
|
2,204 |
|
|
788 |
|
|
|
|
|
Other income, net |
|
(266 |
) |
|
(428 |
) |
|
-- |
|
|
|
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
Trade accounts receivable |
|
(496 |
) |
|
12,665 |
|
|
(3,767 |
) |
|
|
|
|
Other assets |
|
(1,978 |
) |
|
(2,050 |
) |
|
(919 |
) |
|
|
|
|
Inventories |
|
(13,276 |
) |
|
378 |
|
|
(7,237 |
) |
|
|
|
|
Trade accounts payable |
|
12,110 |
|
|
(12,553 |
) |
|
(2,652 |
) |
|
|
|
|
Deferred revenue and customers' advances |
|
4,178 |
|
|
(2,964 |
) |
|
35 |
|
|
|
|
|
Other current liabilities |
|
(6,494 |
) |
|
2,957 |
|
|
(2,764 |
) |
|
|
|
|
Long-term employee related liabilities |
|
(32 |
) |
|
(29 |
) |
|
(240 |
) |
|
|
|
|
Deferred tax, net and other long-term
liabilities |
|
337 |
|
|
(599 |
) |
|
(211 |
) |
|
|
|
|
|
Net cash provided by operating activities |
|
72,735 |
|
|
72,156 |
|
|
69,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS - INVESTING ACTIVITIES |
|
|
|
|
|
|
|
Investments in property and equipment, net |
|
(43,017 |
) |
|
(43,727 |
) |
|
(40,892 |
) |
|
Investments in deposits, marketable securities and other
assets, net |
|
(11,573 |
) |
|
(27,099 |
) |
|
(4,899 |
) |
|
|
|
|
|
Net cash used in investing activities |
|
(54,590 |
) |
|
(70,826 |
) |
|
(45,791 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS - FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt repaid, net |
|
(5,606 |
) |
|
(7,475 |
) |
|
(43,078 |
) |
|
Exercise of options |
|
43 |
|
|
-- |
|
|
21 |
|
|
|
|
|
|
Net cash used in financing activities |
|
(5,563 |
) |
|
(7,475 |
) |
|
(43,057 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE
CHANGE |
|
(104 |
) |
|
3,205 |
|
|
(3,057 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS |
|
12,478 |
|
|
(2,940 |
) |
|
(22,434 |
) |
CASH AND CASH EQUIVALENTS - BEGINNING OF
PERIOD |
|
405,158 |
|
|
408,098 |
|
|
486,880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS - END OF PERIOD |
$ |
417,636 |
|
$ |
405,158 |
|
$ |
464,446 |
|
Tower Semiconductor (NASDAQ:TSEM)
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