Attached files
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EXCEL - IDEA: XBRL DOCUMENT - Tower US Holdings Inc. | Financial_Report.xls |
EX-32.1 - EXHIBIT 32.1 - Tower US Holdings Inc. | exhibit_32-1.htm |
EX-32.2 - EXHIBIT 32.2 - Tower US Holdings Inc. | exhibit_32-2.htm |
EX-31.1 - EXHIBIT 31.1 - Tower US Holdings Inc. | exhibit_31-1.htm |
EX-31.2 - EXHIBIT 31.2 - Tower US Holdings Inc. | exhibit_31-2.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended March 31, 2012
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Or
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Commission file number: 001-32832
Jazz Technologies, Inc.
(Exact name of registrant as specified in its charter)
Delaware
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20-3320580
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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4321 Jamboree Road
Newport Beach, California
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92660
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(Address of principal executive offices)
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(Zip Code)
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(949) 435-8000
Registrant’s telephone number, including area code
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes x No o
(Note: As a voluntary filer not subject to the filing requirements, the Registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months).
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer a non-accelerated filer or a “smaller reporting company”. See definitions of “large accelerated filer” and “accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o
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Accelerated filer o
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Non-accelerated filer x
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Smaller reporting companyo
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Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes o No x
The registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format permitted by General Instruction H(2).
JAZZ TECHNOLOGIES, INC.
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i
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
Jazz Technologies, Inc. (A Wholly Owned Subsidiary of
Tower Semiconductor, Ltd.) and Subsidiaries
(in thousands)
March 31, 2012
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December 31, 2011
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|||||||
(unaudited)
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||||||||
ASSETS
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Current assets:
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Cash and cash equivalents
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$ | 29,418 | $ | 19,471 | ||||
Receivables:
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Trade receivables, net of allowance for doubtful accounts of $1,001 and $1,020 at March 31, 2012 and December 31, 2011, respectively
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20,672 | 17,032 | ||||||
Other receivables
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2,691 | 4,485 | ||||||
Inventories
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23,935 | 25,376 | ||||||
Deferred tax asset
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4,357 | 4,357 | ||||||
Prepaid expenses and other current assets
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4,102 | 4,147 | ||||||
Total current assets
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85,175 | 74,868 | ||||||
Property, plant and equipment, net
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97,703 | 101,537 | ||||||
Intangible assets, net
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42,602 | 43,760 | ||||||
Goodwill
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7,000 | 7,000 | ||||||
Other assets – related parties
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14,527 | 15,185 | ||||||
Other assets - others
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2,276 | 2,350 | ||||||
Total assets
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$ | 249,283 | $ | 244,700 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY
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Current liabilities:
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Short-term bank debt
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$ | 7,500 | $ | 5,300 | ||||
Accounts payable
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13,468 | 12,050 | ||||||
Due to related parties
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4,029 | 2,049 | ||||||
Accrued compensation and benefits
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7,603 | 5,328 | ||||||
Deferred revenues
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2,461 | 2,597 | ||||||
Accrued interest
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1,912 | 3,764 | ||||||
Other current liabilities
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3,481 | 4,427 | ||||||
Total current liabilities
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40,454 | 35,515 | ||||||
Long term liabilities:
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Long-term debt from bank
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10,000 | 10,000 | ||||||
Notes
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70,342 | 69,061 | ||||||
Deferred tax liability
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5,722 | 5,722 | ||||||
Employee related liabilities
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11,881 | 12,227 | ||||||
Other long-term liabilities
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16,240 | 15,699 | ||||||
Total liabilities
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154,639 | 148,224 | ||||||
Stockholder’s equity:
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Additional paid-in capital
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63,576 | 63,576 | ||||||
Cumulative stock based compensation
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1,695 | 1,539 | ||||||
Accumulated other comprehensive loss (*)
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(1,433 | ) | (1,433 | ) | ||||
Retained earnings
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30,806 | 32,794 | ||||||
Total stockholders’ equity
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94,644 | 96,476 | ||||||
Total liabilities and stockholders’ equity
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$ | 249,283 | $ | 244,700 |
(*)
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Accumulated other comprehensive loss includes mainly plan assets and benefit obligation, net of taxes.
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See accompanying notes.
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1
Jazz Technologies, Inc. (A Wholly Owned Subsidiary of
Tower Semiconductor, Ltd.) and Subsidiaries
(in thousands)
Three months ended
March 31, 2012
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Three months ended
March 31, 2011
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Net revenues
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$ | 41,075 | $ | 50,797 | ||||
Cost of revenues
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33,603 | 34,785 | ||||||
Gross profit
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7,472 | 16,012 | ||||||
Operating expenses:
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Research and development
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3,213 | 3,157 | ||||||
Selling, general and administrative
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4,044 | 3,819 | ||||||
Amortization of intangible assets
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197 | 197 | ||||||
Total operating expenses
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7,454 | 7,173 | ||||||
Operating income
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18 | 8,839 | ||||||
Financing expense, net
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(3,095 | ) | (4,293 | ) | ||||
Net income (loss) before income taxes
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(3,077 | ) | 4,546 | |||||
Income tax benefit (expense)
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1,089 | (1,464 | ) | |||||
Net income (loss)
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$ | (1,988 | ) | $ | 3,082 |
See accompanying notes.
2
s
Jazz Technologies, Inc. (A Wholly Owned Subsidiary of
Tower Semiconductor, Ltd.) and Subsidiaries
Unaudited Condensed Consolidated of Comprehensive Income (Loss)
(in thousands)
Three months ended
March 31, 2012
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Three months ended
March 31, 2011
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(In thousands)
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Net income (loss)
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$ | (1,988 | ) | $ | 3,082 | |||
Foreign currency translation adjustment
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-- | -- | ||||||
Comprehensive income (loss)
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$ | (1,988 | ) | $ | 3,082 |
3
Jazz Technologies, Inc. (A Wholly Owned Subsidiary of
Tower Semiconductor, Ltd.) and Subsidiaries
(in thousands)
Three months ended
March 31, 2012
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Three months ended
March 31, 2011
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Operating activities:
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Net income (loss)
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$ | (1,988 | ) | $ | 3,082 | |||
Adjustments to reconcile net income (loss) for the period to net cash provided by operating activities:
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Depreciation and amortization of intangible assets
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8,084 | 8,853 | ||||||
Notes accretion and amortization of deferred financing costs
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1,391 | 1,617 | ||||||
Stock based compensation expense
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156 | 137 | ||||||
Changes in operating assets and liabilities:
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Trade receivables
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(1,856 | ) | (275 | ) | ||||
Inventories
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1,441 | (1,768 | ) | |||||
Prepaid expenses and other current assets
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45 | (1,089 | ) | |||||
Accounts payable
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2,517 | (2,267 | ) | |||||
Due to related parties, net
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656 | 1,197 | ||||||
Accrued compensation and benefits
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2,275 | (236 | ) | |||||
Deferred Revenue
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(136 | ) | 591 | |||||
Accrued interest
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(1,889 | ) | (2,641 | ) | ||||
Other current liabilities
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(946 | ) | (2,178 | ) | ||||
Employee related liabilities and other long-term liabilities
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204 | 114 | ||||||
Net cash provided by operating activities
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9,954 | 5,137 | ||||||
Investing activities:
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Purchases of property and equipment
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(4,191 | ) | (10,243 | ) | ||||
Proceeds related to property and equipment
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1,984 | 1,478 | ||||||
Net cash used in investing activities
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(2,207 | ) | (8,765 | ) | ||||
Financing activities:
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Short-term debt from bank
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2,200 | -- | ||||||
Net cash used in financing activities
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2,200 | -- | ||||||
Net decrease (increase) in cash and cash equivalents
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9,947 | (3,628 | ) | |||||
Cash and cash equivalents at beginning of period
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19,471 | 29,031 | ||||||
Cash and cash equivalents at end of period
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$ | 29,418 | $ | 25,403 | ||||
Non cash activities:
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Investments in property, plant and equipment
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$ | 1,583 | $ | 3,391 | ||||
Supplemental disclosure of cash flow information:
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Cash paid during the period for interest
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$ | 3,809 | $ | 5,559 | ||||
Cash paid during the period for income taxes
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$ | 80 | $ | 2,600 |
See accompanying notes.
4
Jazz Technologies, Inc.
March 31, 2012
Note 1: Business and Formation
Unless specifically noted otherwise, as used throughout these notes to the unaudited condensed consolidated financial statements, “Jazz” or the “Company” refers to the business of Jazz Technologies, Inc., and “Jazz Semiconductor” refers only to the business of Jazz Semiconductor, Inc.
The Company
Since the merger with Tower in 2008, the Company is a 100% subsidiary of Tower.
The Company is based in Newport Beach, California and is an independent semiconductor foundry focused on specialty process technologies for the manufacture of analog intensive mixed-signal semiconductor devices. The Company’s specialty process technologies include advanced analog, radio frequency, high voltage, bipolar and silicon germanium bipolar complementary metal oxide (“SiGe”) semiconductor processes for the manufacture of analog and mixed-signal semiconductors. Its customer’s analog and mixed-signal semiconductor devices are used in cellular phones, wireless local area networking devices, digital TVs, set-top boxes, gaming devices, switches, routers and broadband modems.
Note 2: Summary of Significant Accounting Policies
Basis of Presentation and Consolidation
The Company prepares its consolidated financial statements in accordance with SEC and U.S. generally accepted accounting principles (“US GAAP”) requirements and includes all adjustments of a normal recurring nature that are necessary to fairly present its condensed consolidated results of operations, financial position, and cash flows for all periods presented. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Interim period results are not necessarily indicative of full year results. This quarterly report should be read in conjunction with the Company most recent Annual Report on Form 10-K.
The condensed consolidated financial statements included herein are unaudited; however, they contain all normal recurring adjustments that, in the opinion of management, are necessary to present fairly the Company’s consolidated financial position at March 31, 2012 and December 31, 2011, and the consolidated results of its operations and cash flows for the three months ended March 31, 2012 and 2011. All intercompany accounts and transactions have been eliminated. Certain amounts have been reclassified in order to conform to 2012 presentation.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ materially from those estimates.
Fair Value of Financial Instruments
The Company measures its financial assets and liabilities in accordance with US GAAP. For financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, the carrying amounts approximate fair value due to their short maturities.
5
Concentrations
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and cash equivalents and trade accounts receivable.
The Company generally does not require collateral for insurance of receivables, however, in certain circumstances the Company may require letters of credit. An allowance for doubtful accounts is determined with respect to those amounts that were determined to be doubtful of collection. The Company performs ongoing credit evaluations of its customers.
Accounts receivable from significant customers representing 10% or more of the net accounts receivable balance as of March 31, 2012 and December 31, 2011 consists of 2 customers:
March 31, 2012
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December 31, 2011
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Customer 1
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23 | % | 19 | % | ||||
Customer 2
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13 | 5 |
Net revenues from significant customers representing 10% or more of net revenues consist of the following:
Three months ended
March 31, 2012
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Three months ended
March 31, 2011
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Customer A
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19 | % | 19 | % | ||||
Customer B
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12 | -- | ||||||
Customer C
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5 | 13 | ||||||
Customer D
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-- | 16 |
As a result of the Company’s concentration of its customer base, loss or cancellation of business from, or significant changes in scheduled deliveries of products sold to these customers or a change in their financial position could materially and adversely affect the Company’s consolidated financial position, results of operations and cash flows.
The Company operates a single manufacturing facility located in Newport Beach, California. A major interruption in the manufacturing operations at this facility would have a material adverse affect on the consolidated financial position and results of operations of the Company.
Initial Adoption of New Standards
In the first quarter of 2012, the Company adopted amended standards that increase the prominence of items reported in other comprehensive income. These amended standards eliminate the option to present components of other comprehensive income as part of the statement of changes in stockholders’ equity and require that all changes in stockholders’ equity – except investments by, and distributions to, owners – be presented either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The adoption of these amended standards did impact the presentation of other comprehensive income, as we have elected to present two separate but consecutive statements, but did not have an impact on our financial position or results of operations.
Recently Issued Accounting Standards
No accounting standards were recently issued as of the reporting date.
Note 3: Other Balance Sheet Details
Inventories
Inventories, net of reserves, consist of the following at March 31, 2012 and December 31, 2011 (in thousands):
March 31, 2012
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December 31, 2011
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Raw material
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$ | 3,548 | $ | 3,856 | ||||
Work in process
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9,582 | 9,359 | ||||||
Finished goods
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10,805 | 12,161 | ||||||
$ | 23,935 | $ | 25,376 |
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Property, Plant and Equipment
Property, plant and equipment consist of the following at March 31, 2012 and December 31, 2011 (in thousands):
Useful life
(In years)
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March 31, 2012
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December 31, 2011
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Building improvements
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10-12
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$ | 24,305 | $ | 24,305 | ||||
Machinery and equipment
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148,136 | 145,047 | ||||||
Furniture and equipment
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2,213 | 2,213 | ||||||
Computer software
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3,138 | 3,138 | ||||||
177,792 | 174,703 | ||||||||
Accumulated depreciation
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(80,089 | ) | (73,166 | ) | |||||
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$ | 97,703 | $ | 101,537 |
Intangible Assets
Intangible assets consist of the following at March 31, 2012 (in thousands):
Weighted
Average Life
(years)
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Cost
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Accumulated Amortization
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Net
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Technology
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4;9
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$ | 2,300 | $ | 1,105 | $ | 1,195 | ||||||
Patents and other core technology rights
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15,100 | 5,933 | 9,167 | |||||||||
In-process research and development
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--
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1,800 | 1,800 | -- | |||||||||
Customer relationships
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2,600 | 613 | 1,987 | |||||||||
Trade name
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5,200 | 2,043 | 3,157 | |||||||||
Facilities lease
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33,500 | 6,404 | 27,096 | |||||||||
Total identifiable intangible assets
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$ | 60,500 | $ | 17,898 | $ | 42,602 |
Intangible assets consist of the following at December 31, 2011 (in thousands):
Weighted
Average Life
(years)
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Cost
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Accumulated Amortization
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Net
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Technology
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4;9
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$ | 2,300 | $ | 1,006 | $ | 1,294 | ||||||
Patents and other core technology rights
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15,100 | 5,514 | 9,586 | |||||||||
In-process research and development
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--
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1,800 | 1,800 | -- | |||||||||
Customer relationships
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2,600 | 570 | 2,030 | |||||||||
Trade name
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5,200 | 1,899 | 3,301 | |||||||||
Facilities lease
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33,500 | 5,951 | 27,549 | |||||||||
Total identifiable intangible assets
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$ | 60,500 | $ | 16,740 | $ | 43,760 |
The amortization related to technology, patents, other core technologies, and the facilities’ lease is charged to cost of revenues. The amortization related to customer relationships and trade name is charged to operating expenses.
Note 4: Credit Facility
Borrowing availability under the facility as of March 31, 2012, was $26 million. Outstanding borrowings were $17.5 million and $1.3 million of the facility supporting outstanding letters of credits on that date. The Company considers borrowings of $10 million to be long-term debt as of March 31, 2012. As of March 31, 2012, the Company was in compliance with all the covenants under this facility.
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Note 5: Notes
In 2006, the Company privately placed convertible notes which bore interest at a rate of 8% per annum payable semi-annually, and were scheduled to mature in December, 2011 (“Old Notes”).
On July 2010, the Company, together with its domestic subsidiaries and its parent, Tower, entered into an exchange agreement (the “Exchange Agreement”) with certain note holders (the “Participating Holders”) holding approximately $79.6 million principal amount of the Old Notes. Under the Exchange Agreement, the Participating Holders exchanged their Old Notes for newly-issued 8% non-convertible notes of the Company due June 2015 (the “New Notes”) at an exchange ratio of 1.175 face amount of New Notes for each 1.000 face amount of Old Notes. In October 2011, the Company completed a voluntary transaction to redeem early the entire remaining outstanding amount of the Old Notes held by holders other than the Participating Holders.
In addition to the New Notes, the Participating Holders received warrants to purchase approximately 25.3 million ordinary shares of Tower at an exercise price of $1.70 per share (“Warrants J”). Interest on the New Notes at a rate of 8% per annum is payable semiannually. As of March 31, 2012, approximately $93.6 million in principal amount of New Notes remained outstanding.
The New Notes constitute unsecured obligations of the Company, rank on parity in right of payment with all other indebtedness of the Company, and are effectively subordinated to all secured indebtedness of the Company to the extent of the value of the collateral securing such indebtedness and are not guaranteed by Tower. The New Notes shall rank senior to all future indebtedness of the Company to the extent the future indebtedness is expressly subordinated to the New Notes. The New Notes are jointly and severally guaranteed on a senior unsecured basis by the Company’s domestic subsidiaries.
Beginning July 1, 2013, the Company may redeem some or all of the New Notes for cash at a redemption price equal to par plus accrued and unpaid interest plus a redemption premium equal to 4% if redemption occurs prior to July 1, 2014 and 2% if redemption occurs between July 1, 2014 and maturity.
The Indenture contains certain covenants including covenants restricting the Company’s ability and the ability of its subsidiaries to, among other things, incur additional debt, incur additional liens, make specified payments and make certain asset sales.
Holders of the New Notes are entitled, subject to certain conditions and restrictions, to require the Company to repurchase the New Notes at par plus accrued interest and a 1% redemption premium in the event of certain change of control transactions.
The Company’s obligations under the New Notes are guaranteed by the Company’s wholly owned domestic subsidiaries. The Company has not provided condensed consolidated financial information for such subsidiaries because the Company has no independent assets or operations, the subsidiary guarantees are full and unconditional and joint and several, and subsidiaries of the Company other than the subsidiary guarantors are minor. Other than the restrictions in the Loan Agreement, there are no significant restrictions on the ability of the Company and its subsidiaries to obtain funds from their subsidiaries by loan or dividend.
Note 6: Income Taxes
In February 2012, the U.S. tax authorities commenced an audit of the Company’s 2009 and 2010 tax returns, and asked the Company for certain reports and data in connection with said years’ tax returns. There is no indication to date whether the Company will be required to pay any additional taxes pursuant to said audit.
Note 7: Employee Benefit Plans
The pension and other post retirement benefit plans expenses for the three months ended March 31, 2012 and 2011 were $0.1 million and $0.2 million, respectively.
Note 8: Employee Stock Option Expense
During the three months ended March 31, 2012, Tower did not award any non-qualified stock options exercisable to Tower's ordinary shares to the Company's employees The Company recorded $0.16 million of compensation expenses relating to options granted to employees for the three months ended March 31, 2012. The Company recorded $0.14 million of compensation expenses relating to employees’ options during the corresponding period in 2011.
8
Note 9: Related Party Transactions
As of March 31,
2012
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As of December 31,
2011
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Due from related parties (included in the accompanying balance sheets)
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$ | 19,892 | $ | 20,560 | ||||
Due to related parties (included in the accompanying balance sheets)
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$ | 4,029 | $ | 2,049 |
Related parties balances are with Tower and TowerJazz Japan Ltd. (“TJP”) and are mainly for purchases and payments on behalf of the other party, tools sale, tools lease and service charges.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis should be read in conjunction with the financial statements and related notes contained elsewhere in this report. See our Annual Report on Form 10-K and subsequent quarterly reports filed with the Securities and Exchange Commission for information regarding certain risk factors known to us that could cause reported financial information not to be necessarily indicative of future results.
FORWARD LOOKING STATEMENTS
This report on Form 10-Q may contain “forward-looking statements” within the meaning of the federal securities laws made pursuant to the safe harbor provisions of the Private Securities Litigation Report Act of 1995. These statements, which represent our expectations or beliefs concerning various future events, may contain words such as “may,” “will,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” or other words indicating future results. Such statements may include but are not limited to statements concerning the following:
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anticipated trends in revenues;
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growth opportunities in domestic and international markets;
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new and enhanced channels of distribution;
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customer acceptance and satisfaction with our products;
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expected trends in operating and other expenses;
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purchase of raw materials at levels to meet forecasted demand;
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anticipated cash and intentions regarding usage of cash;
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·
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changes in effective tax rates; and
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·
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anticipated product enhancements or releases.
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This report, including these forward-looking statements, are subject to risks and uncertainties, including those risks and uncertainties described in our Annual Report on Form 10-K and subsequent quarterly reports filed with the Securities and Exchange Commission, that could cause actual results to differ materially from those anticipated as of the date of this report. We assume no obligation to update any forward-looking statements to reflect events or circumstances arising after the date of this report.
For the three months ended March 31, 2012, we had a net loss of $2.0 million compared to a net profit of $3.1 million for the three months ended March 31, 2011.
9
The following table sets forth certain statement of operations data as a percentage of total revenues for the periods indicated.
Three Months Ended
|
||||||||
March 31, 2012
|
March 31, 2011
|
|||||||
Net revenues
|
100 | % | 100 | % | ||||
Cost of revenues
|
81.8 | 68.5 | ||||||
Gross profit
|
18.2 | 31.5 | ||||||
Operating expenses:
|
||||||||
Research and development
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7.8 | 6.2 | ||||||
Selling, general and administrative
|
9.8 | 7.5 | ||||||
Amortization of intangible assets
|
0.5 | 0.4 | ||||||
Total operating expenses
|
18.1 | 14.1 | ||||||
Operating income
|
0.0 | 17.4 | ||||||
Financing expense, net
|
(7.5 | ) | (8.4 | ) | ||||
Income tax benefit (expense)
|
2.7 | (2.9 | ) | |||||
Net income (loss)
|
(4.8 | )% | 6.1 | % |
Comparison of three Months Ended March 31, 2012 and March 31, 2011
Revenues
Our net revenues for the three months ended March 31, 2012 amounted to $41.1 million as compared to $50.8 million for the corresponding period in 2011.The 19% revenue decrease is mainly due to shipped quantities reduction of 17% and 12% reduction in average selling prices due to the weakening customer demand in the semiconductor industry following the recent economic slowdown in Europe and worldwide and following the conditions in the financial markets, with the semiconductor industry experiencing weakening customer demand and reduced rate of growth.
Cost of Revenues
Our cost of revenues decreased to $33.6 million for the three months ended March 31, 2012 compared to $34.8 million for the corresponding period in 2011. The relatively small reduction in cost of revenues as compared to the revenue decrease is due to the high portion of fixed costs associated with operating a foundry.
Gross Profit
Gross profit decreased to $7.5 million in the three months ended March 31, 2012 as compared to $16.0 million in the corresponding period in 2011. Such $8.5 million decrease in gross profit was mainly attributed to the decrease in revenues described above.
Operating Expenses
Operating expenses for the three months ended March 31, 2012 amounted to $7.5 million, substantially unchanged from the $7.2 million in the three months ended March 31, 2011.
Financing Expense, Net
Financing expense, net for the three months ended March 31, 2012 decreased to $3.1 million, from $4.3 million in the corresponding period in 2011 mainly due to the redemption of the Old Notes in October 2011 as described above. Financing expense net, mainly relate to our notes.
10
Income Tax Benefit (Expense)
Income tax benefit amounted to $1.1 million in the three months ended March 31, 2012, as compared to income tax expense of $1.5 million in the three months ended March 31, 2011. The $2.6 million decrease in income tax expenses is mainly as a result of the decrease in the operating profit.
Net Income (loss)
Net loss for the three months ended March 31, 2012 amounted to $2.0 million as compared to net income of $3.1 million in the three months ended March 31, 2011. Such $5.1 million decrease in net income is a result of the revenue decrease which was partially offset by lower financing and tax expenses, as detailed above.
Item 4. Controls and Procedures.
Disclosure Controls and Procedures
Based on the evaluation as of the end of the period covered by this report, our principal executive officer and chief financial officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of the end of the period covered by this report.
Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives, and our principal executive officer and our principal financial officer have concluded that these controls and procedures are effective at the “reasonable assurance” level. We believe that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal controls over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
There are no materials pending legal proceedings, other than ordinary routine litigation incidental to our business, to which we are a party or any of our property is subject
Item 1A. Risk Factors
In addition to the other information contained in this Form 10-Q, you should carefully consider the risk factors associated with our business previously disclosed in Item 1A to Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2011. Our business, financial condition and/or results of operations could be materially adversely affected by any of these risks. Additional risks not presently known to us or that we currently deem immaterial may also impair our business and operations.
Item 6. Exhibits.
Number
|
Description
|
|
31.1
|
Principal Executive Officer Certification required by Rule 13a-14(a) or Rule 15d-14(a).
|
|
31.2
|
CFO Certification required by Rule 13a-14(a) or Rule 15d-14(a).
|
|
32.1
|
Principal Executive Officer Certification required by Section 1350.
|
|
32.2
|
Principal Financial Officer Certification required by Section 1350.
|
|
101
|
Financial information from the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, formatted in XBRL
|
11
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: May 29, 2012
|
JAZZ TECHNOLOGIES, INC.
|
|
By:
|
/s/ Rafi Mor
|
|
_____
(Principal Executive Officer)
|
||
By:
|
/s/ SUSANNA H. BENNETT
|
|
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
INDEX TO EXHIBITS
Number
|
Description
|
|
31.1
|
Principal Executive Officer Certification required by Rule 13a-14(a) or Rule 15d-14(a).
|
|
31.2
|
CFO Certification required by Rule 13a-14(a) or Rule 15d-14(a).
|
|
32.1
|
Principal Executive Officer Certification required by Section 1350.
|
|
32.2
|
Chief Financial Officer Certification required by Section 1350.
|
|
101
|
Financial information from the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, formatted in XBRL
|
12