Third Quarter Represents 10 Percent Revenue Growth Year-Over-Year; Midrange Revenue Guidance of 12 Percent Sequential Growth for Fourth Quarter of 2007
MIGDAL HAEMEK, Israel -- November 6, 2007 -- Tower Semiconductor Ltd., an independent specialty foundry, today announced financial results for the third quarter ended September 30, 2007.
Third Quarter Highlights
Achieved record nine month revenue of $169.2 million representing year-over-year growth of approximately 28 percent
Achieved positive cash flow from operations for the fourth consecutive quarter and positive EBITDA for the eighth consecutive quarter
Won high-volume Fab 2 manufacturing deal with first-tier U.S. IDM
Secured funding and announced plan to further increase Fab 2 capacity to beyond 30,000 wafers-per-month.
Revenue for the third quarter was $56.6 million, representing an increase of 10 percent when compared to revenue of $51.5 million reported in the third quarter of 2006. For the nine months ended September 30, 2007, total revenue was $169.2 million, representing an increase of 28 percent when compared to revenue of $131.9 million reported in the same period one year ago.
Non-GAAP gross profit and operating profit (as described and reconciled below) for the nine months ended September 30, 2007, totaled to $60.5 million and $34.9 million, respectively; and non-GAAP gross profit and operating profit (as described and reconciled below) for the third quarter of 2007 totaled $20.5 million and $11.6 million, respectively. Calculated in accordance with Generally Accepted Accounting Principles (GAAP), net loss for the third quarter of 2007 was $33.4 million, or $0.27 per share, as compared to net income of $39.5 million, or $0.46 per share, in the same period one year ago, which included a one-time restructuring gain of $80.1 million. Excluding the restructuring gain, third quarter 2007 net loss improved by $7.2 million from $40.6 million in the third quarter of 2006.
"During the third quarter we continued to achieve positive EBITDA and positive cash flow from operations,” said Russell Ellwanger, Chief Executive Officer of Tower. “The recent win of a high-volume bid for Fab 2 from a first tier US IDM should be the most significant manufacturing contract that has been secured during my time with the company. With the new tools that we recently purchased, originating at companies such as AMD and Intel, we will be able to fully satisfy our current customers’ demand which currently exceeds our capacity as well as begin to satisfy this new high-volume contract. Our fourth quarter customer demand is strong and we look forward to achieving the financial milestone of a quarter of a billion dollars revenue on an annual basis while implementing our plans to improve bottom line performance.”
Tower forecasts revenue in the fourth quarter 2007 to range between $61 and $65 million, representing midrange sequential revenue growth of 12 percent. As a result, Tower expects its fiscal 2007 revenues to be between $230 and $234 million, representing midrange annual revenue growth of 24 percent over 2006 revenues.
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About Tower Semiconductor Ltd.
Tower Semiconductor Ltd. (Nasdaq: TSEM, TASE: TSEM) is an independent specialty foundry that delivers customized solutions in a variety of advanced CMOS technologies, including digital CMOS, mixed-signal and RF (radio frequency) CMOS, CMOS image sensors, power management devices, and embedded non-volatile memory solutions. Tower’s customer orientation is complemented by its uncompromising attention to quality and service. Its specialized processes and engineering expertise provides highly flexible, customized manufacturing solutions to fulfill the increasing variety of customer needs worldwide. Offering two world-class manufacturing facilities with standard and specialized process technologies ranging from 1.0- to 0.13-micron, Tower Semiconductor provides exceptional design support and technical services to help customers sustain long-term, reliable product performance, while delivering on-time and on-budget results. More information can be found at http://www.towersemi.com.