TowerJazz Reports Revenues of $323 million with Net Profitof $34 million for the Third Quarter of 2018
Guides fourth quarter revenues of ~$340 million, up 5% sequentially
MIGDAL HAEMEK, ISRAEL – October 29, 2018 – TowerJazz (NASDAQ: TSEM & TASE:
TSEM) reported today its results for the third quarter ended September 30, 2018.

Highlights:


Revenues of $323 million resulting in EBITDA of $89 million, and net profit of $34 million
with $0.34 basic earnings per share;Cash from operations of $69 million with free cash flow of $29 million;Cash generation from operations year-to-date of $221 million, with $315 million net cash
balance as of September 30, 2018;

Further strengthened balance sheet:o$98 million reduction in debt, saving $7 million annual financing expenses:


Full conversion of the $58 million of Jazz notes, resulting in no remaining Jazz
subsidiary debt;

oEarly repayment of $40 million San Antonio fab subsidiary loan;

Increased shareholders’ equity reaching $1.15 billion as of September 30, 2018;

Business Outlook
Revenues for the fourth quarter of 2018 are expected to be approximately $340 million, with a range of±5%, up 5% sequentially.
Mr. Russell Ellwanger, Chief Executive Officer of TowerJazz, commented, “We entered the year
having decided to focus on profitability, rather than utilizing valuable capacity for lower margin
businesses. This has had a greater than expected revenue impact in 2018 while building the higher value
mix and with some high-end replacements not having met customer forecasts. The present overallmarket softness has had a recent notable impact across our business units, with a fourth quarter revenue

roll-up lower than previous expectations. However, we expect to see fourth quarter margins increase asa result of this much richer products mix.”
Ellwanger further added: “We are confident with our activities – advancing our technical roadmaps
with associated strong customer traction. Having visited lead customer partners for each of our businessgroups over the past few months, we are convinced that our focus and engagements are industry leading.
Having entered major new long-term contracts with undisputed tier-1 customers for our most advanced
technologies namely 300mm RFSOI and power management, having been awarded breakthroughapplications for image sensors, seamless continuation of customer engagements to our newest mostadvanced 300GHz SiGe platforms, and in the midst of several revolutionary seed technicaldevelopments for SiPho, new proprietary switch and display technologies, we have a base of technology
and customer engagements that will provide engines for growth for the next several years”.

Third Quarter Results Summary
Revenues for the third quarter of 2018 were $323 million, compared to $335 million in the prior quarter
and $355 million in the third quarter of 2017.
Gross and operating profits for the third quarter of 2018 were $73 million and $39 million, respectively,
as compared to $79 million and $44 million, respectively, in the prior quarter, and as compared to $89
million and $55 million in the third quarter of 2017.
EBITDA for the third quarter of 2018 was $89 million, representing a 28% EBITDA margin.
Net profit for the third quarter of 2018 was $34 million, or $0.34 basic earnings per share and $0.33
diluted earnings per share, as compared to $38 million or $0.38 basic earnings per share and $0.37
diluted earnings per share in the prior quarter and as compared to $55 million or $0.56 basic earnings
per share and $0.54 diluted earnings per share in the third quarter of 2017.
Jazz short term notes, originally due December 2018, in the amount of $58 million were fully converted
to TSEM shares, resulting in zero outstanding principal and annual cash savings of $5 million. $19
million of the $58 million were converted during the third quarter of 2018 and $39 million during
October 2018. Post conversion, the current outstanding share count is 105 million and fully diluted
share count remains at 108 million, similar to previous quarters.
Free cash flow for the quarter was $29 million, with $69 million cash flow generated from operations
and $41 million invested in fixed assets, net. The other main cash activities during the third quarter of2018 were $43 million of debt repaid, net of debt received, which included mainly the early repayment

of the $40 million loan borrowed in 2016 from JA Mitsui in relation to the acquisition of the San
Antonio fab from Maxim and its ramp.
Cash (including marketable securities), net of gross debt, as of September 30, 2018, totaled $315 million
as compared to net cash of $226 million as of December 31, 2017.
Shareholders' equity as of September 30, 2018 totaled to $1.15 billion, as compared to $1.03 billion asof December 31, 2017.
Teleconference and Webcast
TowerJazz will host an investor conference call today, Monday, October 29, 2018, at 10:00 a.m. Easterntime (9:00 a.m. Central time, 8:00 a.m. Mountain time, 7:00 a.m. Pacific time and 4:00 p.m. Israel time)
to discuss the Company’s financial results for the third quarter 2018 and its outlook.
This call will be webcast and can be accessed via TowerJazz’s website, or by calling 1-888-668-9141(U.S. Toll-Free), 03-918-0609 (Israel), +972-3-918-0609 (International). For those who are notavailable to listen to the live broadcast, the call will be archived on TowerJazz’s website for 90 days.

The Company presents its financial statements in accordance with U.S. GAAP. The financial information included in thetables below includes unaudited condensed financial data. Some of the financial information in this release, which we describe
in this release as “adjusted” financial measures, is non-GAAP financial measures as defined in Regulation G and related
reporting requirements promulgated by the Securities and Exchange Commission as they apply to our Company. These
adjusted financial measures are calculated excluding one or more of the following: (1) amortization of acquired intangible
assets and (2) compensation expenses in respect of equity grants to directors, officers and employees. These adjusted financial
measures should be evaluated in conjunction with, and are not a substitute for, GAAP financial measures. The tables alsopresent the GAAP financial measures, which are most comparable to the adjusted financial measures, as well as areconciliation between the adjusted financial measures and the comparable GAAP financial measures. As used and/ orpresented in this release, as well as calculated in the tables herein, the term Earnings Before Interest Tax Depreciation andAmortization (EBITDA) consists of net profit in accordance with GAAP, excluding financing expenses, net, other income(expense), net, taxes, non-controlling interest, depreciation and amortization expense and stock-based compensation expense.
EBITDA is reconciled in the tables below from GAAP operating profit. EBITDA is not a required GAAP financial measureand may not be comparable to a similarly titled measure employed by other companies. EBITDA and the adjusted financial
information presented herein should not be considered in isolation or as a substitute for operating profit, net profit, cash flows
provided by operating, investing and financing activities, per share data or other profit or cash flow statement data preparedin accordance with GAAP. The term Net Cash, as used and/ or presented in this release, is comprised of cash, cash equivalents
and marketable securities (in the amounts of $608 million and $560 million as of September 30, 2018 and December 31, 2017,
respectively) less the outstanding principal amount of bank loans (in the amounts of $97 million and $138 million as of
September 30, 2018 and December 31, 2017, respectively), the outstanding principal amount of capital leases (in the amounts
of $35 million and $16 million as of September 30, 2018 and December 31, 2017, respectively) and the outstanding principal
amount of debentures (in the amount of $161 million and $180 million as of September 30, 2018 and December 31, 2017,
respectively). The term Net Cash is not a required GAAP financial measure, may not be comparable to a similarly titledmeasure employed by other companies and should not be considered in isolation or as a substitute for cash, debt, operating
profit, net profit or loss, cash flows provided by operating, investing and financing activities, per share data or other profit or
cash flow statement data prepared in accordance with GAAP. In addition, the term Free Cash Flow, as used and/ or presented
in this release, is calculated to be cash from operating activities (in the amounts of $69 million, $77 million and $104 million
for the three month periods ended September 30, 2018, June 30, 2018 and September 30, 2017, respectively) less cash forinvestments in property and equipment, net (in the amounts of $41 million, $40 million and $42 million for the three month
periods ended September 30, 2018, June 30, 2018 and September 30, 2017, respectively). The term Free Cash Flow is not arequired GAAP financial measure, may not be comparable to a similarly titled measure employed by other companies andshould not be considered in isolation or as a substitute for operating profit, net profit or loss, cash flows provided by operating,investing and financing activities, per share data or other profit or cash flow statement data prepared in accordance withGAAP.

About TowerJazz
Tower Semiconductor Ltd. (NASDAQ: TSEM, TASE: TSEM) and its subsidiaries operate collectively
under the brand name TowerJazz, the global specialty foundry leader. TowerJazz manufactures nextgeneration integrated circuits (ICs) in growing markets such as consumer, industrial, automotive,
medical and aerospace and defense. TowerJazz’s advanced technology is comprised of a broad rangeof customizable process platforms such as SiGe, BiCMOS, mixed-signal/CMOS, RF CMOS, CMOS
image sensor, integrated power management (BCD and 700V), and MEMS. TowerJazz also provides
world-class design enablement for a quick and accurate design cycle as well as Transfer Optimizationand development Process Services (TOPS) to IDMs and fabless companies that need to expand capacity.
To provide multi-fab sourcing and extended capacity for its customers, TowerJazz operates two
manufacturing facilities in Israel (150mm and 200mm), two in the U.S. (200mm) and three facilities inJapan (two 200mm and one 300mm). For more information, please visit www.towerjazz.com.

CONTACTS:
Noit Levy-Karoubi | TowerJazz | +972 4 604 7066 | Noit.levi@towerjazz.com
GK Investor Relations | Gavriel Frohwein, (646) 688 3559 | towerjazz@gkir.com

This press release includes forward-looking statements, which are subject to risks and uncertainties. Actual results may varyfrom those projected or implied by such forward-looking statements and you should not place any undue reliance on suchforward-looking statements. Potential risks and uncertainties include, without limitation, risks and uncertainties associatedwith: (i) demand in our customers’ end markets, (ii) over demand for our foundry services and/or products that exceeds ourcapacity, (iii) maintaining existing customers and attracting additional customers, (iv) operation with no interruption at timesof high utilization in certain areas, and/ or at times of possible bottlenecks, power outages, water leaks, contamination events,
chemical leaks or other issues, which may adversely affect our cycle time, yield, and on schedule delivery, customer
satisfaction, revenue and margins, (v) operating results fluctuate from quarter to quarter making it difficult to predict future
performance, (vi) impact of our debt and other liabilities on our financial position and operations, (vii) our ability tosuccessfully execute acquisitions, integrate them into our business, utilize our expanded capacity and find new business, (viii)
fluctuations in cash flow, (ix) our ability to satisfy the covenants stipulated in our agreements with our lender banks andbondholders (as of September 30, 2018 we are in compliance with all such covenants included in our banks’ agreements, bond
G indenture and others), (x) obtaining new customer engagements, products qualification and production ramp-up of the
TPSCo facilities and our San Antonio facility, (xi) landlord’s claims with respect to the lease of the fab 3 facility; (xii) meetingthe conditions set in the approval certificates received from the Israeli Investment Center, (xiii) receipt of orders that are lower
than the customer purchase commitments, (xiv) failure to receive orders currently expected, (xv) possible incurrence ofadditional indebtedness, (xvi) effect of global recession, unfavorable economic conditions and/or credit crisis, (xvii) our ability
to accurately forecast financial performance, which is affected by limited order backlog and lengthy sales cycles, (xviii)
possible situations of obsolete inventory if forecasted demand exceeds actual demand when we manufacture products before
receipt of customer orders, (xix) the cyclical nature of the semiconductor industry and the resulting periodic overcapacity,
fluctuations in operating results and future average selling price erosion, (xx) the execution of debt re-financing and/or
fundraising to enable the service of our debt and/or other liabilities, (xxi) operating our facilities at high utilization rates
which is critical in order to cover a portion or all of the high level of fixed costs associated with operating a foundry, and ourdebt, in order to improve our results, (xxii) the purchase of equipment to increase capacity, the timely completion of theequipment installation, technology transfer and raising the funds therefor, (xxiii) the concentration of our business in thesemiconductor industry, (xxiv) product returns, (xxv) our ability to maintain and develop our technology processes andservices to keep pace with new technology, evolving standards, changing customer and end-user requirements, new productintroductions and short product life cycles, (xxvi) competing effectively, (xxvii) use of outsourced foundry services by bothfabless semiconductor companies and integrated device manufacturers; (xxviii) achieving acceptable device yields, productperformance and delivery times, (xxix) our dependence on intellectual property rights of others, our ability to operate ourbusiness without infringing others’ intellectual property rights and our ability to enforce our intellectual property against
infringement, (xxx) retention of key employees and recruitment and retention of skilled qualified personnel, (xxxi) exposure to
inflation, currency rates (mainly the Israeli Shekel and Japanese Yen), interest rate fluctuations and risks associated withdoing business locally and internationally, as well fluctuations in the market price of our traded securities, (xxxii) issuance ofordinary shares as a result of conversion and/or exercise of any of our convertible securities, as well as any sale of shares byany of our shareholders, or any market expectation thereof, which may depress the market price of our ordinary shares andmay impair our ability to raise future capital, (xxxiii) meeting regulatory requirements worldwide, including environmental
and governmental regulations, (xxxiv) realization of the fab establishment project in China, including obtaining required
project funding, negotiation and closure of definitive agreements in relation thereto, licensing of technologies, receipt of
payment milestones to Tower, qualification and ramp of process flows and products to enable mass production for customers
and attain revenue to levels that would cover the facility’s fixed costs, and (xxxv) business interruption due to fire and othernatural disasters, the security situation in Israel and other events beyond our control such as power interruptions.

A more complete discussion of risks and uncertainties that may affect the accuracy of forward-looking statements included inthis press release or which may otherwise affect our business is included under the heading "Risk Factors" in Tower’s mostrecent filings on Forms 20-F and 6-K, as were filed with the Securities and Exchange Commission (the “SEC”) and the Israel
Securities Authority. Future results may differ materially from those previously reported. The Company does not intend to
update, and expressly disclaims any obligation to update, the information contained in this release.

# # #(Financial tables follow)

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(dollars in thousands)
September 30,
2018(unaudited)

December 31,
2017

ASSETS
CURRENT ASSETS
Cash and cash equivalents
Marketable securities
Trade accounts receivable
Inventories
Other current assets
Total current assets$

464,446
143,041
163,747
159,507
20,967
951,708$445,961
113,874
149,666
143,315
21,516874,332

LONG-TERM INVESTMENTS

31,17926,073

PROPERTY AND EQUIPMENT, NET

639,042

635,124INTANGIBLE ASSETS, NET

15,006

19,841GOODWILL

7,000

7,000

DEFERRED TAX AND OTHER LONG-TERM ASSETS, NET

96,722111,269

TOTAL ASSETS$

1,740,657$

1,673,639$

45,697
114,375
10,05972,160242,291$

105,958
115,347
14,33866,730302,373

LIABILITIES AND SHAREHOLDERS' EQUITYCURRENT LIABILITIESShort-term debt
Trade accounts payable
Deferred revenue and customers' advances
Other current liabilities
Total current liabilities
LONG-TERM DEBT

247,757

228,723

LONG-TERM CUSTOMERS' ADVANCES

29,97831,908

LONG-TERM EMPLOYEE RELATED LIABILITIES

14,64914,662

DEFERRED TAX AND OTHER LONG-TERM LIABILITIES

52,696

66,267587,371643,933

1,153,286

1,029,706

TOTAL LIABILITIESTOTAL SHAREHOLDERS' EQUITYTOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$

1,740,657$

1,673,639

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)(dollars and share count in thousands, except per share data)

Three
September 30,
2018

YEAR
REVENUESREVENUES$

monthsJune 30,
2018

ended
September 30,
2017322,596 $335,138$

354,557COST
COST
OF SALES
OF REVENUES

249,975

256,610

265,439

GROSS PROFIT

72,621

78,528

89,11818,236
15,826

18,173
16,11517,094
16,822

34,062

34,28833,91638,55944,24055,202(2,497)(7,031)(4,042)

--

1,578

(253)

36,06238,78750,907(2,388)(2,778)3,334

33,67436,00954,241

(28)

1,733

1,033

OPERATING COSTS AND EXPENSES:
ResearchResearchand development
and development
Marketing,Marketing,general andgeneraladministrative
and administrative

OPERATING PROFITOTHER
FINANCING
FINANCING
EXPENSE,INCOMENET(EXPENSE), NET
OTHER
OTHER
INCOMEINCOME(EXPENSE),(EXPENSE),
NET NETPROFIT BEFORE INCOME TAX
INCOMEINCOMETAXTAXBENEFITBENEFIT(EXPENSE)(EXPENSE), NETPROFIT BEFORE NON CONTROLLING INTEREST
MINORITYNON CONTROLLINGRIGHTSINTERESTNET PROFITNET(LOSS)PROFIT$

33,646 $37,742$

55,274BASIC
EARNINGS
PER
SHARE
BASIC
EARNINGS(LOSS)
PER
SHARE

$

0.34 $

0.38

$

0.56

Weighted average number of shares

DILUTEDDILUTEDEARNINGSEARNINGSPER SHAREPER SHARE
Net profit used for diluted earnings per share
Weighted average number of shares

100,158

98,88897,947$0.33 $

0.37

$

0.54

$

33,646 $37,742$57,519102,083

101,066

106,384

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESRECONCILIATION OF CERTAIN FINANCIAL DATA (UNAUDITED)(dollars and share count in thousands, except per share data)
Three
September 30,
2018monthsJune 30,
2018

ended
September 30,
2017

RECONCILIATION FROM GAAP NET PROFIT TO ADJUSTED NET PROFIT:GAAP NET PROFIT
Stock based compensation
Amortization of acquired intangible assets$

33,646 $
2,710
1,627

37,742 $
2,678
1,652

55,2743,750
2,161

ADJUSTED NET PROFIT$

37,983 $42,072 $61,185ADJUSTED NET PROFIT PER SHARE:
Basic
DilutedFully diluted$$$

0.38 $
0.37 $
0.37 $

0.43 $
0.42 $
0.41 $

0.62
0.60
0.59

ADJUSTED NET PROFIT USED TO CALCULATE PER SHARE DATA:
Basic$
37,983 $Diluted$37,983 $Fully diluted$
40,149 $42,072 $44,463 $44,463 $61,18563,43063,430NUMBER OF SHARES AND OTHER SECURITIES USED TO CALCULATE PER SHARE DATA:
Basic
100,158
98,888
Diluted102,083
106,856
Fully diluted
108,146
107,880

97,947
106,384
107,729

EBITDA CALCULATION:GAAP OPERATING PROFIT
Depreciation of fixed assets
Stock based compensation
Amortization of acquired intangible assets$

38,559 $46,172
2,710
1,627

44,240 $46,9782,678
1,652

55,20247,544
3,750
2,161

EBITDA

$

89,068 $95,548 $108,657

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)(dollars and share count in thousands, except per share data)

Nine months ended
September 30,
2018
2017
REVENUES$

970,444 $1,029,696

COST OF REVENUES

753,130

764,749

GROSS PROFIT

217,314264,947

54,67547,93549,29450,297

102,610

99,591OPERATING PROFIT

114,704

165,356

FINANCING EXPENSE, NET(13,283)(11,394)

1,564

400

102,985

154,362(6,121)(1,348)96,864

153,014642(2,214)$97,506 $

150,800$

0.98 $

1.57

OPERATING COSTS AND EXPENSES:
Research and development
Marketing, general and administrative

OTHER INCOME, NETPROFIT BEFORE INCOME TAX
INCOME TAX EXPENSE, NETPROFIT BEFORE NON CONTROLLING INTERESTNON CONTROLLING INTEREST
NET PROFIT

BASIC EARNINGS PER SHARE
Weighted average number of shares

99,18696,085

DILUTED EARNINGS PER SHARE$

0.96 $

1.49

Net profit used for diluted earnings per share$

97,506 $157,403

101,424

105,664Weighted average number of shares

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESCONSOLIDATED SOURCES AND USES REPORT (UNAUDITED)(dollars in thousands)

September 30,
2018
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD$

Cash from operations
Investments in property and equipment, net
Exercise of options, net
Debt received (repaid), net
Effect of Japanese Yen exchange rate change over cash balance
Investments in marketable securities and other assets, net

Three months ended
June 30,
2018

486,880 $464,661

69,471(40,892)
21(43,078)(3,057)(4,899)76,929(40,148)26
3,809(2,909)(15,488)$

September 30,
2017483,603103,916 (a)(41,708)
1,027(15,932)(630)(49,869)

CASH AND CASH EQUIVALENTS - END OF PERIOD$

464,446 $486,880$

480,407

Free Cash Flow$

28,579 $36,781$

62,208 (a)(a) Cash from operations for the three months ended September 30, 2017 included $18,000 received from Tacoma as announced on August21, 2017.

Nine months ended
September 30,
September 30,
2018
2017
CASH AND SHORT-TERM DEPOSITS - BEGINNING OF PERIOD$

Cash from operations
Investments in property and equipment, net
Exercise of warrants and options, net
Debt repaid, net
Effect of Japanese Yen exchange rate change over cash balance
TPSCo dividend to PanasonicInvestments in marketable securities and other assets, net

445,961 $389,377

221,401(121,087)
705(45,925)(1,259)-(35,350)

270,350 (b)(123,368)
28,037(33,392)
3,650(4,378)(49,869)

CASH AND AND SHORT-TERM DEPOSITS - END OF PERIOD$

464,446 $480,407

Free Cash Flow$

100,314 $

146,982 (b)(b) Cash from operations for the nine months ended September 30, 2017 included $18,000 received from Tacoma as announced on August 21,
2017.

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(dollars in thousands)
September 30,
2018

Three months ended
June 30,
September 30,
2018
2017

CASH FLOWS - OPERATING ACTIVITIESNet profit for the period$

33,674 $36,009 $54,241

52,764788--

53,493(4,797)(1,578)55,014(1,177)253(3,767)(919)(7,237)(2,652)35(2,764)(240)(211)
69,471(18,351)
5,713(6,713)
10,222(5,466)
13,355193(5,151)
76,929361
2,980(4,636)
4,795
9,378(13,760)(274)(3,259)103,916 (c)(40,892)(4,899)(45,791)(40,148)(15,488)(55,636)(41,708)(49,869)(91,577)(43,078)
21(43,057)

3,809
26
3,835

(15,932)
1,027(14,905)

EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGE(3,057)(2,909)(630)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD(22,434)
486,880

22,219464,661(3,196)483,603

464,446 $486,880 $480,407

Adjustments to reconcile net profit for the period
to net cash provided by operating activities:
Income and expense items not involving cash flows:
Depreciation and amortization
Effect of indexation, translation and fair value measurement on debt
Other expense (income), net
Changes in assets and liabilities:
Trade accounts receivable
Other assets
Inventories
Trade accounts payable
Deferred revenue and customers' advances
Other current liabilities
Long-term employee related liabilities
Deferred tax, net
Net cash provided by operating activities
CASH FLOWS - INVESTING ACTIVITIESInvestments in property and equipment, net
Investments in marketable securities and other assets, net
Net cash used in investing activities
CASH FLOWS - FINANCING ACTIVITIES
Debt received (repaid), net
Exercise of options, net
Net cash provided by (used in) financing activities

CASH AND CASH EQUIVALENTS - END OF PERIOD$(c) Net cash provided by operating activities for the three months ended September 30, 2017 included $18,000 received from Tacoma
as announced on August 21, 2017.

TOWER SEMICONDUCTOR LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(dollars in thousands)
Nine months ended
September 30,
2018
2017
CASH FLOWS - OPERATING ACTIVITIESNet profit for the period$

96,864 $153,014160,234(5,749)(1,564)

157,101
10,584(400)(14,029)
8,164(16,642)
1,221(6,143)6,372(434)(6,893)
221,401(7,352)(8,766)(4,369)(5,863)(3,921)(9,984)(765)(8,929)270,350 (d)(121,087)(35,350)(156,437)(123,368)(49,869)(173,237)(45,925)705-(45,220)(33,392)
28,037(4,378)(9,733)

EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGE(1,259)3,650

INCREASE IN CASH AND SHORT-TERM DEPOSITSCASH AND SHORT-TERM DEPOSITS - BEGINNING OF PERIOD

18,485445,961

91,030389,377

464,446 $480,407

Adjustments to reconcile net profit for the period
to net cash provided by operating activities:
Income and expense items not involving cash flows:
Depreciation and amortization
Effect of indexation, translation and fair value measurement on debt
Other expense, net
Changes in assets and liabilities:
Trade accounts receivable
Other assets
Inventories
Trade accounts payable
Deferred revenue and customers' advances
Other current liabilities
Long-term employee related liabilities
Deferred tax, net
Net cash provided by operating activities
CASH FLOWS - INVESTING ACTIVITIESInvestments in property and equipment, net
Investments in marketable securities and other assets, net
Net cash used in investing activities
CASH FLOWS - FINANCING ACTIVITIES
Debt repaid, net
Exercise of warrants and options, net
Dividend paid to Panasonic
Net cash used in financing activities

CASH AND CASH EQUIVALENTS - END OF PERIOD$(d) Net cash provided by operating activities for the nine months ended September 30, 2017 included$18,000 received from Tacoma as announced on August 21, 2017.