Tower reports record revenue

Russell Ellwanger

Tower Semiconductor switched to a small GAAP profit in the fourth quarter of 2014 from a $30 million loss a year earlier.

Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) reported its fourth quarter 2014 and full year results today. Revenue for the 2014 fourth quarter was $235 million, a record for the company, and 75% more than in the fourth quarter of 2013. Revenue was 4% higher than in the previous quarter and slightly higher than in the second quarter of 2014, which was the last quarter to include revenue from Micron. The fourth quarter revenue figure is in line with the consensus analysts' estimate.

On a non-GAAP basis, gross profit for the fourth quarter of 2014 was $84 million, reflecting a 36% gross margin. This is an improvement of 83% compared with $46 million gross profit in the fourth quarter of 2013.

EBITDA for the fourth quarter was $56 million, up from $28 million in the fourth quarter of 2013 and $37 million in the previous quarter.

On a non-GAAP basis, net profit for the quarter was $46 million, giving a 20% net profit margin, up from the $19 million profit and 14% net margin reported in the fourth quarter of 2013, and $31 million profit and 14% net margin reported in the previous quarter.

On a GAAP basis, gross profit for the fourth quarter of 2014 was $38 million as compared to $9 million gross profit in the fourth quarter of 2013. Operating profit on a GAAP basis was $28 million for the fourth quarter of 2014 as compared to the $12 million operating loss reported in the fourth quarter of 2013.

Net profit on a GAAP basis for the quarter was $0.6 million, or $0.01 per share, compared with a net loss of $30 million or $0.62 per share in the fourth quarter of 2013, and a net loss of $19 million or $0.37 per share in the previous quarter.

For 2014 as a whole, revenue was a record $828 million reflecting 64% growth, compared with $505 million in 2013. Revenue from the top 10 organic customers, excluding Micron and Panasonic, grew by 34% over 2013.

On an adjusted non-GAAP basis, gross profit and operating profit for 2014 were $259 million and $154 million, compared with $163 million and $90 million, respectively, in 2013.

EBITDA for 2014 was $154 million, significantly higher than $89 million recorded in 2013.

On an adjusted non-GAAP basis, net profit for the full year was $128 million, or $2.46 per share, more than double the 2013 result of $56 million.

Net profit for the year on a GAAP basis was $4 million, or $0.08 per share.

Cash and deposits at the end f 2014 totaled $187 million, compared with $123 million at the end of 2013.

Shareholders' equity at December 31, 2014 was $196 million, compared with $141 million as of December 31, 2013.

TowerJazz expects revenue for the first quarter of 2015 ending March 31, 2015 to be $225 million with an upward or downward range of 5%, representing approximately 70% year over year revenue growth. This guidance is in line with current analysts' estimates.

Tower CEO Russell Ellwanger said, "2014 has been a most significant year for us; strategically, tactically and financially. We recorded our highest revenues ever - the number one year over year growth of all foundries, with strong and growing margins, and continued strength in our financial ratios. While taking several strategic actions, such as TPSCo acquisition, together with a strong mid 20% core organic growth, we created a firm foundation for continued growing performance. In having added new technologies and capabilities to expand existing and create new market application spaces, for example, our joint press release with FLIR regarding infra red capability for IOS and Android smart phones, we certainly have entered 2015 with great reasons to deliver an optimistic outlook. Based upon the very high increase in masks entering our non-TPSCo factories, and the forecasted TPSCo third party production revenues for the second half of 2015, we target to achieve annualized non-GAAP gross profit in the fourth quarter of about $400 million."

Published by Globes [online], Israel business news - www.globes-online.com - on February 23, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

Russell Ellwanger
Russell Ellwanger
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