* Q4 revenue $134.6 mln vs $147.6 mln a year ago
* Adjusted net profit $19 mln vs $22 mln
* Sees Q1 revenue $130-$140 mln
By Ari Rabinovitch
JERUSALEM, Feb 27 Israeli chipmaker TowerJazz
said its sales fell in the fourth quarter, but a joint
venture with Panasonic would help it reach a goal of $1
billion of recurring annual revenue by the first quarter of next
The sales drop stemmed from a decrease in revenue expected
under a three-year contract with Micron Technologies,
which sold its plant in Japan to TowerJazz in 2011.
TowerJazz has lost money for years following heavy
investment in a second chip plant in Israel, but Chief Executive
Russell Ellwanger said he expected "major progress" this year
towards achieving a net profit under local accounting rules.
Revenue in the fourth quarter fell to $134.6 million from
$147.6 million a year earlier, but was up 20 percent compared
with the third quarter. Excluding one-time items, it had a net
profit of $19 million in the quarter, down from $22 million in
the last three months of 2012.
Ellwanger said the joint venture with Panasonic, announced
last month and on target for closure in April, would "more than
make up for anything that is decreased from Micron".
The Israeli maker of chips for smartphones, battery chargers
and AC/DC adapters will have a 51 percent stake in the venture,
which will see Panasonic transfer three of its factories for the
production of semiconductors for cars and other products.
TowerJazz's revenue is expected to increase by about $400
million a year from the venture, and Ellwanger said he expected
to achieve an annual revenue run rate of $900 million by the
second quarter and a $1 billion run rate by the end of 2014 or
the start of 2015.
TowerJazz is part of a consortium, along with
India's Jaiprakash Associates and IBM, that
received cabinet approval this month to build a semiconductor
wafer plant near New Delhi at a cost of 343.99 billion Indian
rupees ($5.55 billion).
Ellwanger said revenue from the project in India, if it
progresses as planned, was likely to start flowing in 2015.
TowerJazz's net loss in the fourth quarter reached $29.8
million under generally accepted accounting practices (GAAP).
"If we don't achieve (a profit) this year, we'll certainly
see major progress towards it within this year," Ellwanger said.
"If we post the joint venture, post some consolidations that we
maybe will do, there is potential that we could be seeing it in
the end of this year."
($1 = 62.0150 Indian rupees)
(Editing by Tom Pfeiffer)