MIGDAL HAEMEK, Israel -- February 1, 2006
-- Tower Semiconductor Ltd. (NASDAQ: TSEM ; TASE: TSEM), a pure-play independent specialty foundry, today announced fourth quarter and fiscal year 2005 results. Revenues for the fourth quarter were $31.1 million, an increase of 51% compared to revenues of $20.6 million for the third quarter of 2005, and an increase of $1 million compared to revenues for the fourth quarter of 2004. The 2005 fourth quarter loss was $45.2 million, or $0.55 per share, which included depreciation and amortization expenses of $36.8 million. The 2005 third quarter loss was $55.4 million, or $0.70 per share and the 2004 fourth quarter loss was $55.7 million, or $0.71 per share, excluding a net capital gain of $32.4 million from the previously announced sale of shares of Saifun Semiconductor. Depreciation and amortization expenses for the third quarter of 2005 and for the fourth quarter of 2004 were $36.9 million and $34.9 million, respectively.
Revenues were $102 million for the 12 months ended December 31, 2005, including $8 million from a previously announced technology-related agreement, as compared with $126.1 million in 2004, which included $1.9 million from this same agreement. Loss for fiscal 2005 was $203.1 million, or $2.55 per share, including $144.9 million depreciation and amortization expenses, as compared with a loss of $170.1 million, or $2.21 per share in 2004, including $121.1 million depreciation and amortization expenses and excluding a net capital gain of $32.4 million from the previously announced sale of shares of Saifun Semiconductor.
"The company, for the first time since the Fab 2 project was initiated, achieved positive EBITDA, as well as record quarter over quarter sales growth. Positive EBITDA was an important milestone achievement as we continue to execute our growth plan. We have stronger targets in front of us in 2006 and the rate of new product qualifications from both new and existing customers, as well as the general market indicators, provide confidence that we will achieve them", said Russell Ellwanger, chief executive officer, Tower Semiconductor. "A 50% quarter over quarter growth is no small thing in any business, and can only be achieved through performance and customer trust. We will continue to build upon this throughout 2006."
Tower expects further growth in revenues for the first quarter of 2006 over the fourth quarter of 2005, and guides revenues of $33 to $35 million.
During the quarter, Tower shipped its first 0.18-micron RF-CMOS products to a new, high profile customer. In addition, the first production lot of 0.13-micron technology was shipped with good yields, demonstrating Fab 2's readiness for the 0.13-micron ramp, expected in the second quarter of 2006.
As used in this release, the term EBITDA consists of loss, according to GAAP (Generally Accepted Accounting Principles), excluding interest and financing expenses (net), tax and depreciation and amortization expenses, as well as capital gain (net) from the sale of Saifun Semiconductor shares recorded in 2004. EBITDA is not a required GAAP financial measure and may not be comparable to a similarly titled measure employed by other companies. EBITDA should not be considered in isolation or as a substitute for operating income, net income or loss, cash flows provided by operating, investing and financing activities, or other income or cash flow statement data prepared in accordance with GAAP.
Tower will host a conference call to discuss these results today, February 1, 2006, at 11 a.m. Eastern time /6 p.m. Israel time. To participate, call +1-866-229-7198 (U.S. toll-free number) or +972-3-918-0609 (international) and mention ID code: TOWER. Callers in Israel are invited to call locally 03-918-0609. The conference call will also be web cast live at www.companyboardroom.com and at www.towersemi.com and will be available thereafter on both websites for replay for 90 days, starting at 2 p.m. Eastern time on the day of the call.
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About Tower Semiconductor Ltd.
Tower Semiconductor Ltd. is a pure-play independent specialty foundry established in 1993. The company manufactures integrated circuits with geometries ranging from 1.0 to 0.13-micron; it also provides complementary technical services and design support. In addition to digital CMOS process technology, Tower offers advanced non-volatile memory solutions, mixed-signal and CMOS image-sensor technologies. To provide world-class customer service, the company maintains two manufacturing facilities: Fab 1 has process technologies from 1.0 to 0.35-micron and can produce up to 16,000 150mm wafers per month. Fab 2 features 0.18-micron and below standard and specialized process technologies and has a current capacity of up to 15,000 200mm wafers per month. Tower's website is located at www.towersemi.com.