Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2016 | |
Document and Entity Information [Abstract] | |
Document Type | 6-K |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2016 |
Entity Registrant Name | TOWER SEMICONDUCTOR LTD |
Entity Central Index Key | 928,876 |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | FY |
Current Fiscal Year End Date | --12-31 |
BALANCE SHEETS
BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 355,284 | $ 175,575 |
Short term deposits | 34,093 | 30,000 |
Trade accounts receivable | 141,048 | 110,065 |
Inventories | 137,532 | 105,681 |
Other current assets | 30,041 | 25,406 |
Total current assets | 697,998 | 446,727 |
LONG-TERM INVESTMENTS | 25,624 | 11,737 |
PROPERTY AND EQUIPMENT, NET | 616,686 | 459,533 |
INTANGIBLE ASSETS, NET | 28,129 | 34,468 |
GOODWILL | 7,000 | 7,000 |
OTHER ASSETS, NET | 4,447 | 5,903 |
TOTAL ASSETS | 1,379,884 | 965,368 |
CURRENT LIABILITIES | ||
Short-term debt and current maturities of loans and debentures | 48,084 | 33,259 |
Trade accounts payable | 99,262 | 91,773 |
Deferred revenue and customers' advances | 26,169 | 23,373 |
Employee related liabilities | 49,517 | 44,734 |
Other current liabilities | 24,083 | 17,980 |
Total current liabilities | 247,115 | 211,119 |
LONG-TERM LOANS FROM BANKS | 133,163 | 210,538 |
DEBENTURES | 162,981 | 45,481 |
LONG-TERM CUSTOMERS' ADVANCES | 41,874 | 21,102 |
EMPLOYEE RELATED LIABILITES | 14,176 | 14,189 |
DEFERRED TAX LIABILITY | 95,233 | 69,744 |
OTHER LONG-TERM LIABILITIES | 2,728 | 7,609 |
TOTAL LIABILITIES | 697,270 | 579,782 |
Ordinary shares of NIS 15 par value: 150,000 authorized as of December 31, 2016 and 2015 93,071 and 92,985 issued and outstanding, respectively, as of December 31, 2016 82,144 and 82,058 issued and outstanding, respectively, as of December 31, 2015 | 369,057 | 326,572 |
Additional paid-in capital | 1,318,725 | 1,273,545 |
Capital notes | 41,264 | 48,553 |
Cumulative stock based compensation | 68,921 | 58,209 |
Accumulated other comprehensive loss | (27,827) | (26,810) |
Accumulated deficit | (1,071,036) | (1,273,654) |
SHAREHOLDERS' EQUITY, before treasury stock | 699,104 | 406,415 |
Treasury stock, at cost - 86 shares | (9,072) | (9,072) |
THE COMPANY'S SHAREHOLDERS' EQUITY | 690,032 | 397,343 |
Non controlling interest | (7,418) | (11,757) |
TOTAL EQUITY | 682,614 | 385,586 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 1,379,884 | $ 965,368 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - ₪ / shares shares in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value | ₪ 15 | ₪ 15 |
Ordinary shares, authorized | 150,000 | 150,000 |
Ordinary shares, issued | 93,071 | 82,144 |
Ordinary shares, outstanding | 92,985 | 82,058 |
Treasury stock, shares | 86 | 86 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
REVENUES | $ 1,249,634 | $ 960,561 | $ 828,008 |
COST OF REVENUES | 946,534 | 755,196 | 764,220 |
GROSS PROFIT | 303,100 | 205,365 | 63,788 |
OPERATING COSTS AND EXPENSES | |||
Research and development | 63,134 | 61,669 | 51,841 |
Marketing, general and administrative | 65,439 | 62,793 | 58,783 |
Nishiwaki Fab restructuring and impairment cost (income), net | (627) | (991) | 55,500 |
Acquisition related costs | 1,229 | ||
TOTAL OPERATING COSTS AND EXPENSES | 127,946 | 123,471 | 167,353 |
OPERATING PROFIT (LOSS) | 175,154 | 81,894 | (103,565) |
INTEREST EXPENSE, NET | (11,857) | (13,179) | (33,409) |
OTHER FINANCING EXPENSE, NET | (12,492) | (109,930) | (55,404) |
GAIN FROM ACQUISITION, NET | 50,471 | 166,404 | |
OTHER INCOME (EXPENSE), NET | 9,322 | (190) | (140) |
PROFIT (LOSS) BEFORE INCOME TAX | 210,598 | (41,405) | (26,114) |
INCOME TAX BENEFIT (EXPENSE) | (1,432) | 12,278 | 24,742 |
NET PROFIT (LOSS) | 209,166 | (29,127) | (1,372) |
Net income (loss) attributable to non controlling interest | (5,242) | (520) | 5,635 |
NET PROFIT (LOSS) ATTRIBUTABLE TO THE COMPANY | $ 203,924 | $ (29,647) | $ 4,263 |
BASIC EARNINGS (LOSS) PER ORDINARY SHARE: | |||
Earnings (loss) per share | $ 2.33 | $ (0.40) | $ 0.08 |
Weighted average number of ordinary shares outstanding | 87,480 | 74,366 | 51,798 |
DILUTED EARNINGS PER ORDINARY SHARE: | |||
Earnings per share | $ 2.09 | $ 0.07 | |
Net profit used for diluted earnings per share | $ 212,160 | $ 4,263 | |
Weighted average number of ordinary shares outstanding used for diluted earnings per share | 101,303 | 63,182 |
STATEMENTS OF COMPREHENSIVE INC
STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net profit (loss) | $ 209,166 | $ (29,127) | $ (1,372) |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustment | 923 | (2,485) | (16,643) |
Change in employees plan assets and benefit obligations, net of taxes $184, $96 and $1,774 for the years ended December 31, 2016, 2015 and 2014, respectively | (546) | 176 | (3,860) |
Unrealized gains (losses) on derivatives | 266 | (64) | |
Comprehensive income (loss) | 209,809 | (31,500) | (21,875) |
Comprehensive (income) loss attributable to non-controlling interest | (6,902) | 769 | 16,538 |
Comprehensive income (loss) attributable to the Company | $ 202,907 | $ (30,731) | $ (5,337) |
STATEMENTS OF COMPREHENSIVE IN6
STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Change in employees plan assets and benefit obligations, tax | $ 184 | $ 96 | $ 1,774 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Ordinary shares [Member] | Additional paid-in capital [Member] | Capital notes [Member] | Unearned compensation [Member] | Accumulated other comprehensive loss [Member] | Foreign currency translation adjustments [Member] | Accumulated deficit [Member] | Treasury stock [Member] | Comprehensive income (loss) [Member] | Noncontrolling interest [Member] | Total |
BALANCE at Dec. 31, 2013 | $ 192,776 | $ 1,084,011 | $ 92,549 | $ 45,380 | $ 3,484 | $ (19,610) | $ (1,248,270) | $ (9,072) | $ 141,248 | ||
BALANCE, SHARES at Dec. 31, 2013 | 47,956,000 | ||||||||||
Establishment of a subsidiary | 7,120 | 7,120 | |||||||||
Issuance of shares and warrant | $ 22,563 | 38,550 | 61,113 | ||||||||
Issuance of shares and warrant, shares | 5,470,000 | ||||||||||
Exercise of options | $ 3,274 | 44 | $ 3,318 | ||||||||
Exercise of options, shares | 763,000 | 762,607 | |||||||||
Capital notes converted into share capital | $ 16,504 | 15,341 | (31,845) | ||||||||
Capital notes converted into share capital, shares | 3,931,000 | ||||||||||
Employee stock-based compensation | 4,637 | 4,637 | |||||||||
Other comprehensive income (loss): | |||||||||||
Profit (loss) | 4,263 | $ 4,263 | (5,635) | (1,372) | |||||||
Foreign currency translation adjustments | (5,740) | (5,740) | (10,903) | (16,643) | |||||||
Change in employees plan assets and benefit obligations | (3,860) | (3,860) | (3,860) | ||||||||
Comprehensive loss | (5,337) | (5,337) | |||||||||
BALANCE at Dec. 31, 2014 | $ 235,117 | 1,137,946 | 60,704 | 50,017 | (376) | (25,350) | (1,244,007) | (9,072) | (9,418) | 195,561 | |
BALANCE, SHARES at Dec. 31, 2014 | 58,120,000 | ||||||||||
Conversion of debentures and exercise of warrants into share capital | $ 79,443 | 126,989 | 206,432 | ||||||||
Conversion of debentures and exercise of warrants into share capital, shares | 20,904,000 | ||||||||||
Exercise of options | $ 6,261 | 1,730 | $ 7,991 | ||||||||
Exercise of options, shares | 1,620,000 | 1,620,056 | |||||||||
Capital notes converted into share capital | $ 5,751 | 6,400 | (12,151) | ||||||||
Capital notes converted into share capital, shares | 1,500,000 | ||||||||||
Employee stock-based compensation | 8,192 | 8,192 | |||||||||
Stock-based compensation related to the Facility Agreement with the Banks | 480 | 480 | |||||||||
Dividend paid to Panasonic | (1,570) | (1,570) | |||||||||
Other comprehensive income (loss): | |||||||||||
Profit (loss) | (29,647) | (29,647) | 520 | (29,127) | |||||||
Foreign currency translation adjustments | (1,196) | (1,196) | (1,289) | (2,485) | |||||||
Change in employees plan assets and benefit obligations | 176 | 176 | 176 | ||||||||
Unrealized loss on derivatives | (64) | (64) | (64) | ||||||||
Comprehensive loss | (30,731) | (30,731) | |||||||||
BALANCE at Dec. 31, 2015 | $ 326,572 | 1,273,545 | 48,553 | 58,209 | (264) | (26,546) | (1,273,654) | (9,072) | (11,757) | 385,586 | |
BALANCE, SHARES at Dec. 31, 2015 | 82,144,000 | ||||||||||
Issuance of shares and warrant | $ 12,504 | 27,496 | 40,000 | ||||||||
Issuance of shares and warrant, shares | 3,297,000 | ||||||||||
Conversion of debentures and exercise of warrants into share capital | $ 12,069 | 10,223 | 22,292 | ||||||||
Conversion of debentures and exercise of warrants into share capital, shares | 3,080,000 | ||||||||||
Exercise of options | $ 14,412 | 3,192 | $ 17,604 | ||||||||
Exercise of options, shares | 3,650,000 | 3,649,754 | |||||||||
Capital notes converted into share capital | $ 3,500 | 3,789 | (7,289) | ||||||||
Capital notes converted into share capital, shares | 900,000 | ||||||||||
Employee stock-based compensation | 9,406 | 9,406 | |||||||||
Stock-based compensation related to the Facility Agreement with the Banks | 480 | 480 | |||||||||
Dividend paid to Panasonic | (2,563) | (2,563) | |||||||||
Accumulated amount due to adoption of ASU No. 2016-09, Compensation - Stock Compensation (Topic 718) | 1,306 | (1,306) | |||||||||
Other comprehensive income (loss): | |||||||||||
Profit (loss) | 203,924 | 203,924 | 5,242 | 209,166 | |||||||
Foreign currency translation adjustments | (737) | (737) | 1,660 | 923 | |||||||
Change in employees plan assets and benefit obligations | (546) | (546) | (546) | ||||||||
Unrealized loss on derivatives | 266 | 266 | 266 | ||||||||
Comprehensive loss | $ 202,907 | 202,907 | |||||||||
BALANCE at Dec. 31, 2016 | $ 369,057 | $ 1,318,725 | $ 41,264 | $ 68,921 | $ (544) | $ (27,283) | $ (1,071,036) | $ (9,072) | $ (7,418) | $ 682,614 | |
BALANCE, SHARES at Dec. 31, 2016 | 93,071,000 | ||||||||||
OUTSTANDING SHARES, NET OF TREASURY STOCK AS OF DECEMBER 31, 2016 at Dec. 31, 2016 | 92,985,000 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CASH FLOWS - OPERATING ACTIVITIES | |||
Net profit (loss) | $ 209,166 | $ (29,127) | $ (1,372) |
Income and expense items not involving cash flows: | |||
Depreciation and amortization | 197,606 | 168,032 | 203,868 |
Financing expense associated with debentures series F | 150 | 87,973 | 39,494 |
Effect of indexation, translation and fair value measurement on debt | 8,292 | 16,078 | (3,667) |
Financing costs relating to Jazz notes exchange | 9,817 | ||
Other expense (income), net | (9,322) | 190 | 140 |
Gain from acquisition, net | (50,471) | (166,404) | |
Changes in assets and liabilities: | |||
Trade accounts receivable | (30,104) | (11,115) | (24,021) |
Other current assets | (265) | (14,978) | 49,934 |
Inventories | (22,069) | (17,908) | (1,758) |
Trade accounts payable | 5,550 | (26,163) | 11,107 |
Deferred revenue and customers' advances | 23,581 | 32,725 | 1,915 |
Other current liabilities | (145) | 8,454 | 25,744 |
Long-term employee related liabilities | (798) | (2,036) | (2,581) |
Deferred tax liability, net | (4,564) | (4,173) | (23,977) |
Other long-term liabilities | 861 | (12,739) | 7,098 |
Nishiwaki employees retirement related payments in connection with its operation cessation | (24,907) | (27,572) | |
Net cash provided by operating activities | 327,468 | 170,306 | 97,765 |
CASH FLOWS - INVESTING ACTIVITIES | |||
Investments in property and equipment | (217,496) | (172,078) | (95,673) |
Proceeds related to sale and disposal of property and equipment | 7,872 | 6,589 | 45,464 |
Acquisition of subsidiaries consolidated for the first time (a) | 57,582 | ||
Deposits and investments, net | (17,101) | (30,000) | 9,924 |
Net cash provided by (used in) investing activities | (226,725) | (195,489) | 17,297 |
CASH FLOWS - FINANCING ACTIVITIES | |||
Issuance of debentures, net | 113,149 | 9,214 | |
Exercise of warrants and options, net | 38,803 | 14,424 | 10,399 |
Proceeds from loans | 55,960 | 70,592 | 85,884 |
Short-term loan repayment to Panasonic | (85,884) | ||
Loans repayment | (132,018) | (18,200) | (41,181) |
Debentures repayment | (51,489) | (10,230) | |
Dividend payment to Panasonic | (2,563) | (1,570) | |
Net cash provided by (used in) financing activities | 73,331 | 13,757 | (31,798) |
Effect of foreign exchange rate change | 5,635 | (166) | (8,968) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 179,709 | (11,592) | 74,296 |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 175,575 | 187,167 | 112,871 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 355,284 | 175,575 | 187,167 |
NON-CASH ACTIVITIES | |||
Investments in property and equipment | 23,747 | 18,657 | 27,495 |
Equity increase associated with Jazz notes exchange | 9,609 | ||
Conversion of debentures to share capital and exercise of warrants | 611 | 195,726 | 34,822 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||
Cash paid during the period for interest | 9,534 | 12,371 | 34,042 |
Cash paid (received) during the period for income taxes | 3,485 | 3,469 | (1,563) |
(a) ACQUISTION OF SUBSIDIARIES CONSOLIDATED FOR THE FIRST TIME, SEE ALSO NOTE 3: | |||
Working capital (excluding cash and cash equivalents) | 10,775 | 32,406 | |
Fixed assets | 106,919 | 245,278 | |
Intangible assets | 2,799 | 24,520 | |
Short-term loan | (85,249) | ||
Long-term liabilities | (28,021) | (93,602) | |
Total | 92,472 | 123,353 | |
Less: | |||
Share capital | 40,000 | 14,531 | |
Gain from acquisition, net | 52,472 | 166,404 | |
Bargain purchase | 92,472 | 180,935 | |
Cash from the acquisition of a subsidiaries consolidated for the first time | $ 57,582 |
DESCRIPTION OF BUSINESS AND GEN
DESCRIPTION OF BUSINESS AND GENERAL | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS AND GENERAL | NOTE 1 - The consolidated financial statements of Tower Semiconductor Ltd. (“Tower”) include the financial statements of Tower, and (i) its wholly-owned subsidiary Tower US Holdings Inc., the sole owner of: (1) Jazz US Holdings Inc. and its wholly-owned subsidiary, Jazz Semiconductor, Inc., an independent semiconductor foundry focused on specialty process technologies for the manufacture of analog intensive mixed-signal semiconductor devices (Jazz US Holdings Inc. and Jazz Semiconductor, Inc. collectively referred to herein as “Jazz”); and (2) since February 2016, Tower US Holdings is also the sole owner of TowerJazz Texas Inc. (“TJT”), as described in Note 3B below and (ii) since March 31, 2014, its majority-owned subsidiary, TowerJazz Panasonic Semiconductor Co., Ltd. (“TPSCo”), an independent semiconductor foundry which includes three semiconductor manufacturing facilities located in Uozu, Tonami and Arai, in Hokuriku Japan, as described in Note 3A below. Tower and its subsidiaries are collectively referred to as the “Company”. The Company is a global specialty foundry leader manufacturing Integrated Circuits Mixed-Signal Image Integrated Power Management Image Sensor The Company operates in the semiconductor industry and competes internationally with dedicated foundry service providers, which, in addition to providing leading edge CMOS process technologies also have capacity for some specialty process technologies. The Company also competes with IDMs that have internal semiconductor manufacturing capacity or foundry operations. Several dedicated foundries have specialized operations and compete directly with the Company in certain areas, flows and technology capabilities. There are a number of smaller participants in the specialty process arena with specific analog focus. The Company believes that most of the large dedicated foundry service providers compete primarily in standard CMOS product types, while they also have capacity for specialty process technologies. As a result, the Company’s main industry competitors are smaller participants which focus on the specialty process analog arena. Tower’s ordinary shares are traded on the NASDAQ Global Select Market and on the Tel-Aviv Stock Exchange (“TASE”) under the symbol TSEM. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - The Company’s consolidated financial statements are presented in accordance with U.S. generally accepted accounting principles (“US GAAP”). A. Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with 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 from those estimates. B. Principles of Consolidation The Company’s consolidated financial statements include the financial statements of Tower and its subsidiaries. The Company’s consolidated financial statements are presented after elimination of inter-company transactions and balances. The Company’s consolidated financial statements include TPSCo’s balance sheet since March 31, 2014 and TPSCo’s results of operations from April 1, 2014 and TJT’s results of operations and balance sheet since February 1, 2016. C. Cash and Cash Equivalents, Short-Term Deposits Cash and cash equivalents consist of cash, bank deposits and short - -term D. Allowance for Doubtful Accounts The allowance for doubtful accounts is computed on the specific identification basis for accounts whose collectability, in the Company’s estimation, is uncertain. As of December 31, 2016 and 2015, the amounts in the allowance for doubtfull accounts are immaterial. E. Inventories Inventories are stated at the lower of cost or market. Cost for raw materials and supplies is determined is determined F. Property and Equipment The Company accounts for property and equipment in accordance with Accounting Standards Codification (“ASC”) 360 “ ” Property and equipment are presented net of investment grants received, and less accumulated depreciation . Depreciation is calculated based on the straight-line method over the Company’s estimated useful lives of the assets or terms of the related leases, as follows: Buildings and building improvements, including facility infrastructure 10-25 years Machinery and equipment, software and hardware 3-15 years In connection with the periodic review of the estimated useful lives of property and equipment at the Company’s foundry manufacturing facilities, the Company determined during 2015, that the estimated useful lives of machinery and equipment should be extended to 15 years from 7 years and the estimated useful lives of facility infrastructure should be extended to 25 years from 14 years. The Company extended the estimated useful lives of these assets as a result of the extended use of mature technologies, longer processes and product life cycles, the versatility of manufacturing equipment, facility systems and infrastructure to provide better flexibility to meet changes in customer demand and the ability to re-use equipment over several technology cycles significantly extending the estimated usage period of such assets. For further details, see Note 8A. Impairment charges, if needed, are determined based on the policy outlined in R below. G. Intangible Assets The Company accounts for intangible assets in accordance with ASC 350 “ ” The amounts attributed to intangible assets as part of the purchase price allocations for the acquisitions are amortized over the expected estimated economic life of the intangible assets commonly used in the industry. Impairment charges, if needed, are determined based on the policy outlined in R below. H. Other Assets Other Assets include mainly prepaid long-term lease payments to the Israel Land Administration (“ILA”) for the land on which the company’s Israeli fabs are established, net of accumulated amortization over the lease period, see also Note 16C . I. Convertible Debentures Under ASC 470-20 “Debt with Conversion and Other Options”, the proceeds from the sale of debt securities with detachable conversion feature and other options, are allocated to each of the securities issued based on their relative fair value. For more information about Convertible debentures see Note 13 J. Stock-Based Instruments in Financing Transactions The Company calculates the fair value of stock-based instruments included in the units issued in its financing transactions. That fair value is recognized in equity, if determined to be eligible for equity classification. The fair value of such stock-based instruments, when included in issuance of debt that is not itself accounted at fair value , K. Revenue Recognition The Company’s revenues are generated principally from sales of semiconductor wafers. The Company also derives revenues from design support and other technical and support services incidental to the sale of semiconductor wafers. The vast majority of the Company’s sales are achieved through the effort of its direct sales force. In accordance with ASC Topic 605 “Revenue Recognition”, the Company recognizes revenues from sale of products when the following fundamental criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred or services have been rendered; (iii) the price to the customer is fixed or determinable; and (iv) collection of the resulting receivable is reasonably assured. Generally, delivery occurs after products meet all of the customer’s acceptance criteria based on pre-shipment electronic, functional and quality tests. The Company provides for sales returns allowance relating to specified yield or quality commitments as a reduction of revenues based on past experience and specific identification of events necessitating an allowance. L. Research and Development Research and development costs are charged to operations as incurred. Amounts received or receivable from the government of Israel and others, as participation in research and development programs, are offset against research and development costs. The accrual for grants receivable is determined based on the terms of the programs, provided that the criteria for entitlement have been met. M. Income Taxes The Company accounts for income taxes using an asset and liability approach as prescribed in ASC 7 40-10 “ Income Taxes ” (“ASC 740-10” The Company evaluates realizability of its deferred tax assets for each jurisdiction in which the Company operates at each reporting date, and establishes valuation allowances when it is more likely than not that all or a part of its deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the same character and in the same jurisdiction. The Company considers all available positive and negative evidence in making this assessment, including, but not limited to, the scheduled reversal of deferred tax liabilities and projected future taxable income. In circumstances where there is sufficient negative evidence indicating that the Company's deferred tax assets are not more-likely-than-not realizable, the Company establishes a valuation allowance. ASC 740-10 prescribes a two-step approach for recognizing and measuring uncertain tax positions. The first step is to evaluate tax positions taken or expected to be taken in a tax return by assessing whether they are more-likely-than-not sustainable, based solely on their technical merits, upon examination and including resolution of any related appeals or litigation process. The second step is to measure the associated tax benefit of each position as the largest amount that the Company believes is more-likely-than-not realizable. Differences between the amount of tax benefits taken or expected to be taken in its income tax returns and the amount of tax benefits recognized in its financial statements, represent the Company's unrecognized income tax benefits. The Company's policy is to include interest and penalties related to unrecognized income tax benefits as a component of income tax expense. N. Earnings (Loss) Per Ordinary Share Basic earnings (loss) per share are calculated in accordance with ASC 260, “Earnings Per Share” ("ASC 260") by dividing profit or loss attributable to ordinary equity holders of Tower (the numerator) by the weighted average number of ordinary shares outstanding during the reported period (the denominator). Diluted earnings per share are O. Comprehensive Income (Loss) In accordance with ASC 220 “Comprehensive Income” ("ASC 220"), comprehensive income (loss) represents the change in shareholders’ equity during a reporting period from transactions and other events and circumstances from non-owner sources. It includes all changes in equity during a reporting period except those resulting from investments by owners and distributions to owners. Other comprehensive income (loss) (“OCI”) represents gains and losses that are included in comprehensive income but excluded from net income. P. Functional Currency and Exchange Rate Losses The currency of the primary economic environment in which Tower, TJT and Jazz conduct their operations is the U.S. Dollar rate Q. Stock-Based Compensation The Company applies the provisions of ASC Topic 718 “Compensation - Stock Compensation”, under which employees’ share-based equity awards are accounted for under the fair value method. Accordingly, stock-based compensation granted to employees and directors is measured at the grant date, based on the fair value of the grant. The Company uses the straight-line attribution method to recognize stock-based compensation costs over the vesting period of the grant, except for grants that involve performance criteria , R. Impairment of Assets Impairment of Property, Equipment and Intangible Assets The Company reviews long-lived assets and intangible assets on a periodic basis, as well as when such a review is required based upon relevant circumstances, to determine whether events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable, considering the undiscounted cash flows expected from it. If applicable, the Company recognizes an impairment loss based upon the difference between the carrying amount and the fair value of such assets, in accordance with ASC 360-10 “Property, Plant and Equipment”. Impairment of Goodwill Goodwill is subject to an impairment test performed at least on an annual basis or upon the occurrence of certain events or circumstances. The goodwill impairment test is performed based on the result of an initial qualitative assessment for the likelihood of impairment. If this assessment does not result in a more-likely-than-not indication of impairment, no further impairment testing is required. If it does result in a more-likely-than-not indication of impairment, the impairment test is performed. Goodwill impairment is assessed based on a comparison of the fair value of the unit to which the goodwill is ascribed, and the underlying carrying value of its net assets, including goodwill. If the carrying amount of the unit exceeds its fair value, the implied fair value of the goodwill is compared with its carrying amount to measure the amount of impairment loss, if any. The Company uses the income approach methodology of valuation that includes discounted cash flows to determine the fair value of the unit. Significant management judgment is required in the forecasts of future operating results used for this methodology. S. Classification of Liabilities and Equity Tower applies ASC 815-40 “Contract in Entity’s Own Equity” in determining whether an instrument that may be settled in Tower’s shares is also considered indexed to a company’s own stock, for the purpose of classification of the instrument as a liability or equity. T. Derivatives and hedging Derivative instruments are recognized as either assets or liabilities and are measured at fair value. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation. For derivative instruments designated as fair value hedges, the gains (losses) are recognized in earnings in the periods of change together with the offsetting losses (gains) on the hedged items attributed to the risk being hedged. For derivative instruments designated as cash flow hedges, the effective portion of the gains (losses) on the derivatives is initially reported as a component of OCI and is subsequently recognized in earnings when the hedged exposure is recognized in earnings. Gains (losses) on derivatives representing either hedge components excluded from the assessment of effectiveness or hedge ineffectiveness are recognized in earnings. For derivative instruments that are not designated as hedges, gains (losses) from changes in fair values are primarily recognized in the same line of the item economiclly hedged. U. Reclassification and Presentation Certain amounts in prior years’ financial statements have been reclassified in order to conform to the 2016 presentation. V. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for revenue recognition in Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” recently ASU 2014-09 is effective January 1, 2018. Early adoption is permitted but not before January 1, 2017. Should be In November 2015, the FASB issued ASU 2015-17 “ Balance Sheet Classification of Deferred Taxes ”. In April 2015, the FASB issued 2015-03 “Interest Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ”. financing As a result of the retrospective adoption of ASU 2015-03 effective January 1, 2016, deferred financing costs of approximately $856, previously classified within long-term assets. were applied to reduce the related debt liabilities as of December 31, 2015. In 2016, issuance expenses relating to Series G Debentures and to the bank loan to TJT were deducted accordingly from the debt liability carrying amounts. In January 2016, the FASB issued ASU 2016-01 it’s In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842 )”, leases In March 2016, the FASB issued ASU 2016-09 ,“ Compensation - Stock Compensation (Topic 718 )”. The update requires that the adoption related to forfeitures be accounted for using the modified retrospective method where the effect of the change relating to previous years was to be recognized as an adjustment to the opening balance of retained earnings. The amount of the adjustment related to previous years is approximately $1,300 . In June 2016, the FASB issued ASU 2016-13 “Financial Instruments Credit Losses”. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. The Company has previously incurred immaterial amount of bad debt and expecting no material impact from adopting this guidance on its consolidated financial statements and disclosures. In November 2016, the FASB issued ASU 2016-18 |
RECENT ACQUISITIONS
RECENT ACQUISITIONS | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
RECENT ACQUISITIONS | NOTE 3 - A. TowerJazz Panasonic Semiconductor Co., Ltd. Establishment During 2014, Tower signed agreements with Panasonic Corporation (“Panasonic”) according to which (a) Panasonic formed a fully-owned subsidiary named TPSCo during 2014; (b) Panasonic transferred license rights to semiconductor wafer manufacturing processes and transferred its capacity tools of three of its fabs (8 inch and 12 inch) located in Hokuriku Japan (Uozu, Tonami and Arai) to TPSCo; and (c) Tower acquired 51% of the shares of TPSCo in consideration for the issuance of ordinary shares of Tower to Panasonic valued at approximately $7,411. TPSCo, Tower and Panasonic also agreed to the following, among others: (i) a five-year manufacturing agreement between Panasonic and TPSCo, under which Panasonic will acquire products from TPSCo; (ii) a five-year production related and complimentary services agreement between Panasonic and TPSCo, under which Panasonic will acquire services from TPSCo; (iii) TPSCo will license certain technologies from Panasonic in order to utilize certain Panasonic process technologies for the manufacturing of products; (iv) Panasonic will provide TPSCo with various transition services and support; (v) TPSCo will lease the manufacturing buildings and related facilities’ infrastructure from Panasonic; and (vi) TPSCo will receive services from Tower including marketing, sales, general and administration services. B. TowerJazz Texas Inc. Establishment In February 2016, Tower acquired a fabrication facility in San Antonio, Texas from Maxim Integrated Products Inc. (“Maxim”). The acquisition was done through an indirectly wholly owned subsidiary of Tower, TJT. The purchase price was $40,000, payable through the issuance of approximately 3.3 million The agreement with Maxim included an earn-out mechanism for a period of up to 10 months. According to that mechanism, if the proceeds from the sale of the shares by Maxim during the 10 month period plus the value of the shares remaining, if any, as of the last day of this 10 month period, are less than the purchase price (i.e., $40,000), the Company would need to compensate Maxim with by In addition, Tower and Maxim entered into a long - The fair values set forth below are based on a valuation of TJT’s assets and liabilities and purchase price allocation performed by the Company in accordance with ASC 805-10 "Business Combinations", The fair value of the assets acquired, net of liabilities, as detailed in the table below, exceeded the $40,000 purchase price by $52,472, thereby creating a gain from the acquisition. The allocation of fair value to the assets acquired and liabilities assumed is as follows: As of February 1, 2016 Current assets $ 14,342 Tangible assets 106,919 Intangible assets 2,799 Total assets as of acquisition date $ 124,060 Customer advance $ 2,310 Other current liabilities 1,257 Deferred tax liability 28,021 Liabilities incurred as of acquisition date $ 31,588 Consideration payable through Tower’s shares issued $ 40,000 Gain from acquisition (*) $ 52,472 (*) Gain from acquisition is presented in the Statement of Operations net of $2,001 acquisition related costs. |
RESTRUCTURING OF JAPAN OPERATIO
RESTRUCTURING OF JAPAN OPERATIONS | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING OF JAPAN OPERATIONS | NOTE 4 - During 2014, the Company restructured The restructuring was implemented contemporaneously with the acquisition of TPSCo in Japan, which enabled the Company to unify its Japanese business activities and manufacturing under one Japanese entity. Since the Company’s Japanese business and other objectives were able to be fulfilled through TPSCo’s establishment, the Company believes this restructuring had immaterial effect on its future busienss or on its business objectives. The Company’s activities were not downsized, but rather the Company increased its presence and scope of business in Japan, including increased revenue, increased manufacturing and headcount. The net restructuring and asset impairment charges (credits) in the consolidated statements of operations totaled to impairment charges of $47,472, $(2,641) and $(986) and restructuring costs of $8,028, $1,650 and $359 in the years ended December 31, 2014, 2015 and 2016, respectively . Amounts Changes in TJP facility closure related accruals for the years ended December 31, 2015 and 2016 were as follows: Asset impairment and related costs (*) Other restructuring Total Accrued balance as of December 31, 2014 $ 1,196 $ 3,407 $ 4,603 Assets impairment related costs and other restructuring charges 3,200 4,116 7,316 Reduction of prior accrual and impairment (5,841 ) (2,466 ) (8,307 ) Charges against accrual 5,841 -- 5,841 Cash payments (1,296 ) (3,113 ) (4,409 ) Accrued balance as of December 31, 2015 $ 3,100 $ 1,944 $ 5,044 Reduction of prior accrual (986 ) -- (986 ) Charges against accrual -- 359 359 Cash payments (321 ) (2,303 ) (2,624 ) Accrued balance as of December 31, 2016 $ 1,793 $ -- $ 1,793 (*) Charges associated with asset impairment represent the write-down of the related assets to their new fair value and are recorded concurrently with the recognition of the accrual. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 5 - INVENTORIES Inventories consist of the following: As of December 31, 2016 2015 Raw materials $ 26,296 $ 27,848 Work in process 105,564 73,437 Finished goods 5,672 4,396 $ 137,532 $ 105,681 Work in process and finished goods are presented net of aggregate write-downs to net realizable value of $1,391 and $621 as of December 31, 2016 and 2015, respectively. |
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2016 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
OTHER CURRENT ASSETS | NOTE 6 - OTHER CURRENT ASSETS Other current assets consist of the following: As of December 31, 2016 2015 Receivables from tax authorities $ 9,620 $ 6,913 Deferred taxes 7,158 7,036 Prepaid expenses 6,610 10,570 TJT acquisition related Receivable, 5,000 -- Others 1,653 887 $ 30,041 $ 25,406 |
LONG-TERM INVESTMENTS
LONG-TERM INVESTMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
LONG-TERM INVESTMENTS | NOTE 7 - LONG-TERM INVESTMENTS Long-term investments consist of the following: As of December 31, 2016 2015 Severance pay funds (see Note 15) $ 9,909 $ 10,015 Long-term interest bearing bank deposit 12,500 -- Others 3,215 1,722 $ 25,624 $ 11,737 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 8 - PROPERTY AND EQUIPMENT, NET A. Composition As of December 31, 2016 2015 Original cost: Buildings (including facility infrastructure) $ 333,696 $ 292,303 Machinery and equipment 2,093,204 1,808,411 $ 2,426,900 $ 2,100,714 Accumulated depreciation: Buildings (including facility infrastructure) (205,604 ) (197,518 ) Machinery and equipment (1,604,610 ) (1,443,663 ) (1,810,214 ) (1,641,181 ) $ 616,686 $ 459,533 As of December 31, 2016 and 2015, the original cost of buildings, machinery and equipment was reflected net of investment grants (see B below) in the aggregate amount of $284,406. During 2015, the estimated useful lives of machinery and equipment were extended to 15 years from 7 years and the useful lives of facility infrastructure were extended to 25 years from 14 years. For more details, see Note 2F. For the year ended December 31, 2015, the impact of these extended estimated useful lives was approximately $42,000 of reduced depreciation expenses which resulted in a net decrease of approximately $27,000 in the Company’s loss for the year and a decrease in basic loss per share by $0.37. The Company believes that the current estimates of useful lives are reasonable, sustainable and better reflect the future anticipated usage of these assets. B. Investment Grants In February 2011, Tower received an approval certificate from the Israeli Investment Center for an expansion program for investments in fixed assets in Israel, according to which Tower received grants in the amount of approximately NIS 135 million (approximately $36,000) for eligible investments made by Tower from 2006 to 2012. Entitlement to the above grants is subject to various conditions stipulated by the criteria set forth in the certificate of approval issued by the Israeli Investment Center, as well as by the Israeli Law for the Encouragement of Capital Investments - 1959 (“Investments Law”) and the regulations promulgated there under. In order to secure fulfillment of the conditions related to the receipt of investment grants, floating liens were registered in favor of the State of Israel on substantially all of Tower’s assets. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 9 - Intangible assets consist of the following as of December 31, 2016: Useful Life (years) Cost Accumulated Amortization Net Technologies 4;5;9 $ 109,543 $ (98,354 ) $ 11,189 Facilities lease 19 33,500 (20,377 ) 13,123 Patents and other core technology rights 9 15,100 (13,903 ) 1,197 Trade name 9 7,520 (6,064 ) 1,456 Customer relationships 15 2,600 (1,436 ) 1,164 Others -- 1,000 (1,000 ) -- Total identifiable intangible assets $ 169,263 $ (141,134 ) $ 28,129 Intangible assets consist of the following as of December 31, 2015: Useful Life (years) Cost Accumulated Amortization Net Technologies 4;5;9 $ 106,363 $ (93,048 ) $ 13,315 Facilities lease 19 33,500 (19,089 ) 14,411 Patents and other core technology rights 9 15,100 (12,225 ) 2,875 Trade name 9 7,455 (5,000 ) 2,455 Customer relationships 15 2,600 (1,263 ) 1,337 Others -- 1,000 (925 ) 75 Total identifiable intangible assets $ 166,018 $ (131,550 ) $ 34,468 |
OTHER ASSETS, NET
OTHER ASSETS, NET | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS, NET | NOTE 10 - OTHER ASSETS, NET Other assets, net consist of the following: As of December 31, 2016 2015 Prepaid long-term land lease, net (see Note 16C) $ 3,537 $ 3,658 Long term prepaid expenses and others 910 2,245 $ 4,447 $ 5,903 |
OTHER CURRENT LIABILITIES
OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities, Current [Abstract] | |
OTHER CURRENT LIABILITIES | NOTE 11 - OTHER CURRENT LIABILITIES Other current liabilities consist of the following: As of December 31, 2016 2015 Interest payable $ 4,683 $ 2,138 Restructuring related payables 1,793 5,044 Tax authorities payables 10,342 7,645 Others 7,265 3,153 $ 24,083 $ 17,980 |
LONG-TERM LOANS FROM BANKS
LONG-TERM LOANS FROM BANKS | 12 Months Ended |
Dec. 31, 2016 | |
Loans Payable [Abstract] | |
LONG-TERM LOANS FROM BANKS | NOTE 12 - LONG-TERM LOANS FROM BANKS A. Composition: As of December 31, 2016 2015 In U.S. Dollars, see also B, Cand E below $ 40,000 $ 101,955 In JPY, see also D below 126,376 143,675 Total long-term loans from banks 166,376 245,630 Fair value adjustments -- (7,900 ) Deferred issuance costs (1,344 ) (511 ) Total long-term loans from banks 165,032 237,219 Current maturities (31,869 ) (26,681 ) $ 133,163 $ 210,538 B. Facility Agreement with Israeli Banks In June 2016, following the issuance of the Series G Debentures, as detailed in Note 13D below, Tower prepaid all of the outstanding loans under the facility agreement (“Facility Agreement”) with the two largest Israeli banks, Bank Leumi and Bank Ha’poalim (“the Israeli Banks”), thereby releasing Tower from the extensive contractual restrictions and covenants under the Facility Agreement with the Israeli Banks, as well as all fixed and floating liens that were charged on Tower’s assets (present and future) in favor of said Israeli Banks. As of June 30, 2016, the liens were fully released. The Facility Agreement was carried at fair value with changes recognized in financing expenses. For the changes in the fair value for the years C. Wells Fargo Credit Line In December 2013, Jazz entered into an agreement with Wells Fargo Capital Finance, part of Wells Fargo & Company (“Wells Fargo”), for a five-year secured asset-based revolving credit line in the total amount of up to $70,000, maturing in December 2018 (the “Jazz Credit Line Agreement”). The applicable interest on the loans under the Jazz Credit Line Agreement for the period following February 2016 is at a rate equal to, at lender’s option, either the lender’s prime rate plus a margin ranging from 0.25% to 0.75% or the LIBOR rate plus a margin ranging from 1.5% to 2.0% per annum. The outstanding borrowing availability varies from time to time based on the levels of Jazz’s eligible accounts receivable, eligible equipment, eligible inventories and other terms and conditions described in the Jazz Credit Line Agreement. The obligations of Jazz under the Jazz Credit Line Agreement are secured by a security interest on all the assets of Jazz. The Jazz Credit Line Agreement contains customary covenants and other terms, including customary events of default. If any event of default will occur, Wells Fargo may declare all borrowings under the facility due immediately and foreclose on the collateral. Furthermore, an event of default under the Credit Line Agreement would result in an increase in the interest rate on any amounts outstanding. Jazz’s obligations pursuant to the Jazz Credit Line Agreement are not guaranteed by Tower or any of its affiliates . As of December 31, 2016, borrowing availability under the Jazz Credit Line Agreement was approximately $62,000, of which approximately $1,000 was utilized through letters of credit. Outstanding principal amount of loans drawn under the Jazz Credit Line Agreement was approximately $19,000 as of December 31, 2015. No such loan amounts were outstanding As of December 31, 2016, Jazz was in compliance with all of the covenants under this agreement. D. Loans to TPSCo from Japanese Institutions In June 2014, TPSCo entered into a long - The loan carries an annual interest of the TIBOR (Tokyo Interbank Offered Rate) six months’ rate plus 1.65% per annum with the principal amount payable between 2016 The Term Loan is secured by an assignment of TPSCo’s right to receive any amounts under its manufacturing and production related services agreements with Panasonic. The Term Loan contains certain covenants, as well as definitions of events of default and acceleration terms of the repayment schedule. In December 2015, TPSCo and JA Mitsui Leasing, Ltd., Sumitomo Mitsui Trust Bank Limited and Showa Leasing Co., Ltd. (“JP Banks”) signed an asset - (the “Asset-Based Loan” or “ABL”), the , amount was approximately $73,000 and $71,000 as of December 31, 2016 and 2015, respectively. The ABL carries an interest equal to the six month TIBOR (Tokyo Interbank Offered Rate) plus 2.0% per annum with the principal amount payable between 2017 and 2020. The ABL is secured by a lien over the machinery and equipment of TPSCo located in Uozu and Tonami manufacturing facilities. The ABL also contains certain financial ratios and covenants, as well as definitions of events of default and acceleration of the repayment schedule. TPSCo’s obligations pursuant to the ABL are not guaranteed by Tower or any of its affiliates . E. Bank In July 2016, TJT entered into an asset based long - This loan agreement contains customary terms, conditions and covenants, as well as customary events of default. TJT’s obligations pursuant to the loan agreement are not guaranteed by Tower or any of its affiliates . |
DEBENTURES
DEBENTURES | 12 Months Ended |
Dec. 31, 2016 | |
Notes Payable [Abstract] | |
DEBENTURES | NOTE 13 - A. Composition by Repayment Schedule As of December 31, 2016 Interest rate 2017 2018 2019 2020 2021 2022 and on Total Debentures Series D 8% $ 5,977 $ -- $ -- $ -- $ -- $ -- $ 5,977 Debentures Series F 7.8% 238 -- -- -- -- -- 238 Debentures Series G 2.79% -- -- -- 34,776 34,776 52,165 121,717 Jazz’s Notes (as defined in E 8% -- 58,307 -- -- -- -- 58,307 Total outstanding principal amounts of debentures $ 6,215 $ 58,307 $ -- $ 34,776 $ 34,776 $ 52,165 $ 186,239 Accretion of carrying amount to principal amount (17,043 ) Carrying amount $ 169,196 As of December 31, 2015 Interest rate 2016 2017 2018 Total Debentures Series D 8% $ 5,906 $ -- $ -- $ 5,906 Debentures Series F 7.8% 851 -- -- 851 Jazz’s Notes (as defined in E below ) 8% -- -- 58,307 58,307 Total outstanding principal amounts of debentures $ 6,757 $ -- $ 58,307 $ 65,064 Accretion of carrying amount to principal amount (13,005 ) Carrying amount $ 52,059 Tower’s debentures Series D, Series F and interest thereon are unsecured and were subordinated to Tower’s indebtedness to the government of Israel, see Note 8B. Said debentures were originally due December 31, 2016, however were redeemed on the following day due to December 31, 2016 being a non-business-day. For details in regards to Jazz Notes, see E below. Debenture Series B. Debentures Series D During 2007, Tower issued long-term non-convertible debentures of approximately $27,000 aggregate principal amount, repayable in six equal annual installments starting Series D non-convertible debentures outstanding principal amounted to approximately $6,000 as of December 31, 2016 and 2015, respectively. The Series D was fully redeemed in January 2017. C. Debentures Series F In 2010 and 2012, Tower issued un-secured and subordinated long-term debentures in the aggregate principal amount of approximately $231,000, linked to the US dollar, which carried an interest rate of 7.8% per annum payable semiannually, repayable in two equal installments in December 2015 and December 2016 (“Series F”). During 2016, 2015 and 2014, total of approximately $1,000, $196,000 and $34,000 of Series F were converted into ordinary shares , $0 at the commitment date Series F outstanding principal amounted to approximately $238 and $851 as of December 31, 2016 and 2015, respectively. The Series F was fully redeemed in January 2017. D. Debentures Series G In June 2016, Tower raised approximately $115,000 through the issuance of long-term unsecured non-convertible debentures (“Series G Debentures”). The Series G Debentures aggregate principal amount is NIS 468 million ( app The Series G Debentures include customary financial and other terms and conditions, including a negative pledge and financial covenants. As of December 31, 2016, the Company was in compliance with the financial covenants thereunder. E. Jazz 2014 Notes Exchange Agreement In March 2014, Jazz, certain of its domestic subsidiaries and Tower entered into an exchange agreement (the “2014 Exchange Agreement”) with certain holders of previously issued Jazz notes from 2010 (the “2014 Participating Holders”) (the “2010 notes”) according to which Jazz issued new unsecured convertible senior notes due December 2018 (the “2014 Notes” or the “Jazz Notes”) in exchange for approximately $45,000 in aggregate principal amount of the 2010 notes that were originally due June 2015. In addition, in March 2014, Jazz, Tower and certain of the 2014 Participating Holders (the “Purchasers”) entered into a purchase agreement (the “Purchase Agreement”) pursuant to which the Purchasers purchased $10,000 in aggregate principal amount of the 2014 Notes for cash consideration. Holders of the 2014 Notes may submit a conversion request with respect to their 2014 Notes, to be settled at Jazz’s discretion through cash or ordinary shares of Tower. The conversion price is set to $10.07 per share. Interest on the 2014 Notes at a rate of 8% per annum is payable semiannually. The 2014 Notes are unsecured senior obligations of Jazz, rank equally with all other existing and future unsecured senior indebtedness of Jazz, and are effectively subordinated to all existing and future secured indebtedness of Jazz, including the Jazz Credit Line Agreement (see Note 12C above), to the extent of the value of the collateral securing such indebtedness. The 2014 Notes rank senior to all existing and future subordinated debt. The 2014 Notes are not guaranteed by Tower. Holders of the 2014 Notes are entitled, subject to certain conditions and restrictions, to require Jazz to repurchase the 2014 Notes at par value The Indenture contains certain customary covenants including covenants restricting the ability of Jazz and its subsidiaries to, among other things, incur additional debt, incur additional liens, make specified payments and make certain asset sales. Jazz’s obligations under the 2014 Notes are guaranteed by Jazz’s wholly owned domestic subsidiaries. As of December 31, 2016 and 2015, approximately $58,000 principal amount of 2014 Notes was outstanding. The Jazz Credit Line Agreement imposes certain limitations on the ability to repay the 2014 Notes and/or to incur additional indebtedness without Wells Fargo’s consent. Any default on payment or refinancing of the 2014 Notes prior to said notes maturity, in a form satisfactory to Wells Fargo, would trigger a cross default under the Jazz Credit Line Agreement, which would permit the lenders to accelerate the obligations thereunder, potentially requiring Jazz to repay or refinance the Jazz Credit Line Agreement. As of December 31, 2016 there are no outstanding loan drawdowns under the Wells Fargo Credit Line (see Note 12C ). |
FINANCIAL INSTRUMENTS AND FAIR
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASURMENTS | 12 Months Ended |
Dec. 31, 2016 | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS [Abstract] | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASURMENTS | NOTE 14 - The Company makes certain disclosures as detailed below with regard to financial instruments, including derivatives. These disclosures include, among other matters, the nature and terms of derivative transactions, information about significant concentrations of credit risk and the fair value of financial assets and liabilities. A. Non-Designated Exchange Rate Transactions As the functional currency of Tower is the USD and part of Tower's expenses are denominated in NIS, Tower enters from time to time into exchange rate agreements to protect against the volatility of future cash flows caused by changes in foreign exchange rates on NIS denominated expenses. As of December 31, 2016 and 2015 the fair value amounts of such exchange rate agreements were approximately $294 in a liability position and $67 in a liability position with face value of $96,000 and $38,000, respectively. As the functional currency of TPSCo is the JPY and part of TPSCo revenues are denominated in USD, TPSCo enters from time to time into exchange rate agreements to protect against the volatility of future cash flows caused by changes in foreign exchange rates on USD denominated amounts. As of December 31, 2016 and 2015, the fair value amounts were B. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, bank deposits, derivative , The Company generally does not require collateral for insurance of receivables; however, in certain circumstances, the Company obtains credit insurance or may require letters of credit. An allowance for doubtful accounts is determined with respect to those amounts which their collection C. Fair Value of Financial Instruments The estimated fair values of the Company’s financial instruments, excluding debentures do not materially differ from their respective carrying amounts as of December 31, 2016 and D. Cash Flow Hedge Gains (Losses) The Company entered into cash flow hedging transactions to mitigate the foreign exchange rate differences on the principle and interest using a cross currency swap to mitigate the risk arising from Series G denomination in NIS. As of December 31, 2016 the fair value of the swap was $67 in a - E. Fair Value Measurements Valuation Techniques: In general, and where applicable, the Company uses quoted prices in active markets for identical assets or liabilities to determine fair value. This pricing methodology applies to the Company’s Level 1 assets and liabilities. If quoted prices in active markets for identical assets and liabilities are not available to determine fair value, the Company uses quoted prices for similar assets and liabilities or inputs other than the quoted prices that are observable, either directly or indirectly. This pricing methodology applies to the Company’s Level 2 and Level 3 assets and liabilities. Level 2 Measurements: Over the counter derivatives - the Company uses the market approach using quotations from banks and other public information. Level 3 Measurements : Tower's Israeli Banks’ Loans (prior to full repayment of the loans in 2016 ): . Liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Tower’s Israeli Banks Loans (including current maturities) Others As of January 1, 2016 - at fair value $ 74,955 $ -- principal repayment (82,855 ) -- Total changes in fair value recognized in earnings 7,900 -- As of December 31, 2016 - at fair value $ -- $ -- Recurring Fair Value Measurements Using the Indicated Inputs: December 31, 2016 Quoted prices in active market for identical liability (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Cross currency swap- liability position $ 67 -- $ 67 -- Foreign Exchange forward and cylinders- liability position 976 976 -- $ 1,043 $ -- $ 1,043 $ -- December 31, 2015 Quoted prices in active market for identical liability (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Tower’s loans (including current maturities) $ 74, 891 $ -- $ -- $ 74, 891 Foreign - liability position 64 64 $ 74, 955 $ -- $ 64 $ 74, 891 Liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Tower’s loans (including current maturities) Others As of January 1, 2015 - at fair value $ 77,029 $ 34 Loan repayment (18,200 ) -- Total changes in fair value recognized in earnings 16,126 (34 ) As of December 31, 2015 - at fair value $ 74,955 $ -- Unrealized losses recognized in earnings related to outstanding loans as of December 31, 2015 $ 13,219 $ -- |
EMPLOYEE RELATED LIABILITIES
EMPLOYEE RELATED LIABILITIES | 12 Months Ended |
Dec. 31, 2016 | |
Postemployment Benefits [Abstract] | |
EMPLOYEE RELATED LIABILITIES | NOTE 15 - EMPLOYEE RELATED LIABILITIES A. Employee Termination Benefits Israeli law, labor agreements and corporate policy determine the obligations of Tower to make severance payments to dismissed Israeli employees and to Israeli employees leaving employment under certain circumstances. Generally, the liability for severance pay benefits, as determined by Israeli law, is based upon length of service and the employee’s monthly salary. This liability is primarily covered by regular deposits made each month by Tower into recognized severance and pension funds and by insurance policies maintained by Tower, based on the employee’s salary for the relevant month. The amounts so funded and the liability are reflected separately on the balance sheets in long-term investments and long-term employee related liabilities in the amounts of $9,909 and $11,988, respectively, as of December 31, 2016. Commencing January 1, 2005, Tower implemented a labor agreement with regard to most of its Israeli employees, according to which monthly deposits into recognized severance and pension funds or insurance policies will release it from any additional severance obligation in excess of the balance in such accounts to such Israeli employees and, therefore, Tower incurs no liability or asset with respect to such severance obligations and deposits, since that date. Any net severance amount as of such date will be released on the employee’s termination date. Payments relating to Israeli employee termination benefits were $4,345, $3,986 and $3,801 for 2016, 2015 and 2014, respectively. TPSCo established a Defined Contribution Retirement Plan (the “DC Plan”) for its employees through which TPSCo contributes approximately 10% with employee average match of 1% from employee base salary to the DC Plan. Such contribution releases the employer from further obligation to any payments upon termination of employment. The contribution is remitted either to third party benefit funds based on employee preference, or directly, to those employees who elected not to enroll in the DC Plan. Total payments under the DC Plan in 2016, 2015 and 2014 amounted to $7,015, $6,823 and $4,011, respectively. B. Jazz Employee Benefit Plans The following information provide the changes in 2016, 2015 and 2014 periodic expenses and benefit obligations due to the bargaining agreement effective December 19, 2009 entered into by Jazz with its collective bargaining unit employees. Post-Retirement Medical Plan The components of the net periodic benefit cost and other amounts recognized in other comprehensive income (loss) for post-retirement medical plan expense are as follows: Year ended December 31, 2016 2015 2014 Net periodic benefit cost: Service cost $ 12 $ 29 $ 24 Interest cost 85 126 118 Amortization of prior service costs (12 ) (973 ) (1,737 ) Amortization of net (gain) or loss (333 ) (115 ) (227 ) Total net periodic benefit cost $ (248 ) $ (933 ) $ (1,822 ) Other changes in plan assets and benefits obligations recognized in other comprehensive income: Prior service cost for the period $ -- $ -- $ -- Net (gain) or loss for the period (316 ) (1,333 ) 558 Amortization of prior service costs 12 973 1,737 Amortization of net gain or (loss) 333 115 227 Total recognized in other comprehensive income (expense) $ 29 $ (245 ) $ 2,522 Total recognized in net periodic benefit cost and other comprehensive income $ (219 ) $ (1,178 ) $ 700 Weighted average assumptions used: Discount rate 4.80 % 4.30 % 5.20 % Expected return on plan assets N/A N/A N/A Rate of compensation increases N/A N/A N/A Assumed health care cost trend rates: Health care cost trend rate assumed for current year (Pre-65/Post-65) 6.75%/10.00 % 7.00%/20.00 % 7.75%/25.00 % Ultimate rate (Pre-65/Post-65) 4.50%/5.00 % 4.50%/5.00 % 5.00%/5.00 % Year the ultimate rate is reached (Pre-65/Post-65) 2025/2022 2025/2022 2022/2022 Measurement date December 31, 2016 December 31, 2015 December 31, 2014 Impact of one - Increase Decrease Effect on service cost and interest cost $ 7 $ (5 ) Effect on post-retirement benefit obligation $ 59 $ (46 ) The components of the change in benefit obligation, change in plan assets and funded status for post-retirement medical plan are as follows: Year ended December 31, 2016 2015 2014 Change in benefit obligation: Benefit obligation at beginning of period $ 1,781 $ 2,977 $ 2,317 Service cost 12 29 24 Interest cost 85 126 118 Benefits paid (12 ) (18 ) (40 ) Change in plan provisions -- -- -- Actuarial loss (gain) (316 ) (1,333 ) 558 Benefit obligation end of period $ 1,550 $ 1,781 $ 2,977 Change in plan assets: Fair value of plan assets at beginning of period $ -- $ -- $ -- Employer contribution 12 18 40 Benefits paid (12 ) (18 ) (40 ) Fair value of plan assets at end of period $ -- $ -- $ -- Funded status $ (1,550 ) $ (1,781 ) $ (2,977 ) As of December 31, 2016 2015 2014 Amounts recognized in statement of financial position: Current liabilities (37 ) (40 ) (83 ) Non-current liabilities (1,513 ) (1,741 ) (2,894 ) Net amount recognized $ (1,550 ) $ (1,781 ) $ (2,977 ) Weighted average assumptions used: Discount rate 4.50 % 4.80 % 4.30 % Rate of compensation increases N/A N/A N/A Assumed health care cost trend rates: Health care cost trend rate assumed for next year (pre 65/ post 65) 7.20%/10.00 % 6.75%/10.00 % 7.00%/20.00 % Ultimate rate (pre 65/ post 65) 4.50%/4.50 % 4.50%/5.00 % 4.50%/5.00 % Year the ultimate rate is reached (pre 65/ post 65) 2025/2025 2025/2022 2025/2022 The following benefit payments are expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter: Fiscal Year Other Benefits 2017 $ 37 2018 48 2019 59 2020 66 2021 67 2022-2026 $ 346 Jazz adopted several changes to the post-retirement medical plan in 2012 that cumulatively reduced it’s Jazz Pension Plan Jazz has a pension plan that provides for monthly pension payments to eligible employees upon retirement. The pension benefits are based on years of service and specified benefit amounts. Jazz uses a December 31 measurement date. Jazz funding policy is to make contributions that satisfy at least the minimum required contribution for IRS qualified plans. The components of the change in benefit obligation, the change in plan assets and funded status for Jazz’s pension plan are as follows: Year ended December 31, 2016 2015 2014 Net periodic benefit cost: Interest cost 841 798 796 Expected return on plan assets (1,154 ) (1,130 ) (1,257 ) Amortization of prior service costs 3 3 3 Amortization of net (gain) or loss 34 31 -- Total net periodic benefit cost $ (276 ) $ (298 ) $ (458 ) Other changes in plan assets and benefits obligations recognized in other comprehensive income: Prior service cost for the period $ -- $ -- $ -- Net (gain) or loss for the period 736 6 3,117 Amortization of prior service costs (3 ) (3 ) (3 ) Amortization of net gain or (loss) (34 ) (31 ) -- Total recognized in other comprehensive income (expense) $ 699 $ (28 ) $ 3,114 Total recognized in net periodic benefit cost and other comprehensive income (expense) $ 423 $ (326 ) $ 2,656 Weighted average assumptions used: Discount rate 4.60 % 4.20 % 5.10 % Expected return on plan assets 6.20 % 6.20 % 7.50 % Rate of compensation increases N/A N/A N/A Year ended December 31, 2016 2015 2014 Estimated amounts that will be amortized from accumulated other comprehensive income in the next fiscal year ending : Prior service cost 3 3 3 Net actuarial (gain) or loss $ 54 $ 33 $ 31 The components of the change in benefit obligation, change in plan assets and funded status for Jazz’s pension plan are as follows: Year ended December 31, 2016 2015 2014 Change in benefit obligation: Benefit obligation at beginning of period $ 18,605 $ 19,304 $ 15,873 Interest cost 841 798 796 Benefits paid (496 ) (451 ) (532 ) Change in plan provisions -- -- -- Actuarial loss (gain) 722 (1,046 ) 3,167 Benefit obligation end of period $ 19,672 $ 18,605 $ 19,304 Change in plan assets: Fair value of plan assets at beginning of period $ 18,526 $ 18,134 $ 16,652 Actual return on plan assets 1,141 78 1,307 Employer contribution 700 765 707 Benefits paid (496 ) (451 ) (532 ) Fair value of plan assets at end of period $ 19,871 $ 18,526 $ 18,134 Funded status $ 199 $ (79 ) $ (1,170 ) Accumulated benefit obligation $ 19,672 $ 18,605 $ 19,304 Amounts recognized in statement of financial position: Non-current assets $ 199 $ -- $ -- Non-current liabilities -- (79 ) (1,170 ) Net amount recognized $ 199 $ (79 ) $ (1,170 ) Weighted average assumptions used: Discount rate 4.30 % 4.60 % 4.20 % Rate of compensation increases N/A N/A N/A The following benefit payments are expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter: Fiscal Year Other Benefits 2017 $ 706 2018 797 2019 866 2020 943 2021 999 2022-2026 $ 5,719 The plan’s assets measured at fair value on a recurring basis consisted of the following as of as of December 31, 2016: Level 1 Level 2 Level 3 Investments in mutual funds $ -- $ 19,871 $ -- Total plan assets at fair value $ -- $ 19,871 $ -- The plan’s assets measured at fair value on a recurring basis consisted of the following as of as of December 31, 2015: Level 1 Level 2 Level 3 Investments in mutual funds $ -- $ 18,526 $ -- Total plan assets at fair value $ -- $ 18,526 $ -- Jazz’s pension plan weighted average asset allocations on December 31, 2016, by asset category are as follows: Asset Category December 31, 2016 Target allocation 2017 Equity securities 62 % 60 % Debt securities 38 % 40 % Real estate 0 % 0 % Other 0 % 0 % Total 100 % 100 % Jazz’s primary policy goals regarding the plan’s assets are cost-effective diversification of plan assets, competitive returns on investment, and preservation of capital. Plan assets are currently invested in mutual funds with various debt and equity investment objectives. The target asset allocation for the plan assets is 40% debt, or fixed income securities, and 60% equity securities. Individual funds are evaluated periodically based on comparisons to benchmark indices and peer group funds and investment decisions are made by Jazz in accordance with the policy goals. Actual allocation to each asset category fluctuates and may not be within the target specified above due to changes in market conditions. The estimated expected return on assets of the plan is based on assumptions derived from, among other things, the historical return on assets of the plan, the current and expected investment allocation of assets held by the plan and the current and expected future rates of return in the debt and equity markets for investments held by the plan. The obligations under the plan could differ from the obligation currently recorded if management's estimates are not consistent with actual investment performance. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 16 - A. Commitments and Contingencies Relating to Fab 2 (1) Facility Agreement Liens For liens on Tower’s assets under the Facility Agreement which were fully released as of June 30, 2016, see Note 12B. For liens relating to Jazz Credit Line Agreement, see Note 12C. For liens under TPSCo 2015 Term Loan agreement see Note 12D. For liens relating to TJT term loan, see Note 12E. (2) Approved Enterprise Status For details regarding Approved Enterprise Status relating to Fab 2, see Note 20A and Note 8B. B. License Agreements The Company enters into intellectual property and licensing agreements with third parties from time to time. The effect of each of them on the Company’s total assets and results of operations is immaterial. Certain of these agreements call for royalties to be paid by the Company to these third parties. C. Leases Tower’s administrative offices and corporate headquarters, Fab 1 and Fab 2 manufacturing operations are located in a building complex situated in an industrial park in Migdal Ha’emek, in the northern part of Israel. The premises where the administrative offices and Fab 1 are located are under a long-term lease from the ILA, which expires in 2032. Tower has no obligation for lease payments related to this lease through the year 2032. Tower entered into a long-term lease agreement with the ILA relating to Fab 2 for a period ending in 2049. The lease payments through 2049 relating to this lease have been paid in advance and are expensed through the operational lease period. Tower occupies certain other premises under various operating leases. The obligations under such leases were not material as of December 31, 2016. Jazz leases its fabrication facilities under lease contracts that may be extended until 2027, through the exercise of an option at Jazz’s sole discretion to extend the lease period through 2027. In 2015, Jazz exercised its first option to extend the lease term from 2017 to 2022, while maintaining the option to extend the lease term at its sole discretion from 2022 to 2027. In the amendments to its leases, (i) Jazz secured various contractual safeguards designed to limit and mitigate any adverse impact of construction activities on its fabrication operations ; and (ii) Aggregate rental expenses were In 2014, TPSCo entered into a five- year three Future minimum payments under TPSCo’s non-cancelable operating building and facilities lease were D. Other Agreements The Company enters , E. Environmental Affairs The Company’s operations are subject to a variety of laws and state and governmental regulations relating to the use, discharge and disposal of toxic or otherwise hazardous materials used in the production processes. Operating permits and licenses are required for the operation of the Company’s facilities and these permits and licenses are subject to revocation, modification and renewal. Government authorities have the power to enforce compliance with these regulations, permits and licenses. As of the approval date of the financial statements, the Company is not aware of any noncompliance with the terms of said permits and licenses. F. Other Commitments Receipt of certain research and development grants from the government of Israel is subject to various conditions. In the event Tower fails to comply with such conditions, Tower may be required to repay all or a portion of the grants received. In Tower’s opinion, Tower has been in full compliance with the conditions through December 31, 2016 and hence repayment of the grant is considered remote. G. Litigation In January 2016, a short-selling focused firm issued a short sell thesis report which the Company believes contains false and misleading information about the Company's strategy, business model and financials. Following this short sell thesis report, shareholder class actions were filed in the US and Israel against the Company, certain officers, its directors and/or its external auditor. This short sell thesis analyst acknowledged at the time of the report that he shall be assumed to be in a short position in Tower’s shares. In July 2016, the US court-appointed lead plaintiff voluntarily withdrew the action and the US court approved the voluntary dismissal of the class action in the US. The Company believes that the outstanding alleged claims in Israel, which are largely akin to the claims made and dismissed in the US, are also without merit and will vigorously defend such actions if the court ultimately accepts such action as a class action. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 17 - A. Description of Ordinary Shares As of December 31, 2016, Tower had 150 million authorized ordinary shares, par value NIS 15.00 each, of which approximately 93 million were issued and outstanding. Holders of ordinary shares are entitled to participate equally in the payment of cash dividends and bonus share (stock dividend) distributions and, in the event of the liquidation of Tower, in the distribution of assets after satisfaction of liabilities to creditors. Each ordinary share is entitled to one vote on all matters to be voted on by shareholders. B. Equity Incentive Plans (1) General The Company has granted to its employees and directors options and Restricted Stock Units (“RSUs”) to purchase ordinary shares under several share incentive plans adopted by the Company. The particular provisions of each plan and grant vary as to vesting period, exercise price, exercise period and other terms. Generally, (i) the exercise price of options will not be lower than the nominal value of the shares and will equal either the closing market price of the ordinary shares immediately prior to the date of grant, or, in relation to grants made from September 2013, an average of the closing price during the thirty Except for those share incentive plans described below, as of December 31, 2016 and December 31, 2015, respectively, there were approximately 0.64 million and 1.64 million options outstanding under the Company’s share incentive plans (the "Old Plans”). No further options may be granted under Old Plans. (2) Tower’s 2013 Share Incentive Plan (the "2013 Plan") In 2013, the Company adopted a new share incentive plan for directors, officers, and employees of the Company. Options granted under the 2013 Plan bear an exercise price which equals an average of the closing price during the thirty trading days immediately prior to the date of grant, vest over up to a three-year period and are not exercisable beyond seven years from the grant date. Under the 2013 Plan, the Company granted in 2016 and 2015 a total of 0.57 million and 0.88 million options and RSUs , described In June 2016, the Company granted the following equity awards to its CEO and directors under the 2013 Share Incentive Plan: (i) 197,890 options, 31,053 time vested RSUs and 15,790 performance - As of December 31, 2016, approximately 1.63 million options and 1.01 million RSUs were outstanding under the 2013 Plan. As of December 31, 2015, approximately 4.24 million options and 0.77 million RSUs were outstanding under the 2013 Plan. Further grants may be approved subject to compensation committee, board of directors and shareholders’ approval as may be required by law. (3) Summary of the Status of all the Company’s Employees’ and Directors’ Share Incentive Plans 2016 2015 2014 Number Weighted average exercise price Number Weighted average exercise price Number Weighted average exercise price Outstanding as of beginning of year 5,878,270 $ 6.84 7,537,219 $ 6.37 8,066,749 $ 6.31 Granted 207,890 12.19 100,000 16.92 746,431 5.81 Exercised (3,649,754 ) 4.82 (1,620,056 ) 4.94 (762,607 ) 4.36 Terminated (97,063 ) 21.34 (26,777 ) 22.28 (30,901 ) 35.40 Forfeited (61,254 ) 7.25 (112,116 ) 8.30 (482,453 ) 5.86 Outstanding as of end of year 2,278,089 9.92 5,878,270 6.84 7,537,219 6.37 Options exercisable as of end of year 1,606,983 $ 10.19 2,606,704 $ 8.93 1,834,281 $ 11.54 2016 2015 Number Weighted Average Fair Value Number Weighted Average Fair Value Outstanding as of beginning of year 773,200 $ 15.11 -- $ -- Granted 359,643 12.83 783,700 15.11 Exercised (86,847 ) 11.45 -- -- Forfeited (36,812 ) 14.73 (10,500 ) 15.15 Outstanding as of end of year 1,009,184 14.62 773,200 15.11 RSU exercisable as of end of year -- $ -- -- $ -- (4) Summary of Information about Employees’ Share Incentive Plans The following table summarizes information about employees’ share options outstanding as of December 31, 2016: Outstanding as of December 31, 2016 Exercisable as of December 31, 2016 Range of exercise Number outstanding Weighted average remaining contractual life Weighted average exercise price Number exercisable Weighted average exercise price $ 4.42-13.20 1,613,375 4.25 $ 6.08 1,032,269 $ 4.95 15.90-19.50 421,878 2.30 17.01 331,878 17.04 $ 21.00-28.20 242,836 0.88 $ 23.10 242,836 $ 23.10 2,278,089 1,606,983 Year ended December 31, 2016 2015 2014 The intrinsic value of options exercised $ 40,314 $ 15,374 $ 3,680 The original fair value of options exercised $ 16,711 $ 3,721 $ 2,661 Year ended December 31, 2016 2015 2014 The intrinsic value of RSU's exercised $ 1,177 $ -- $ -- The original fair value of RSU's exercised $ 994 $ -- $ -- Stock-based compensation expenses were recognized in the Statement of Operations as follows: Year ended December 31, 2016 2015 2014 Cost of goods $ 3,920 $ 2,214 $ 753 Research and development, net 2,119 1,905 1,034 Marketing 3,367 3,421 2,897 Total stock $ 9,406 $ 7,540 $ 4,684 (5) Weighted Average Grant-Date Fair Value of Options Granted to Employees The weighted average grant-date fair value of the options granted during 2016, 2015 and 2014 to employees and directors amounted to $4.20, $7.16 and $3.10 per option, respectively. The Company utilizes the Black-Scholes model. The Company estimated the fair value, utilizing the following assumptions for the years 2016, 2015 and 2014 (all in weighted averages): 2016 2015 2014 Risk-free interest rate 0.9%-1.3 % 1.2%-1.4 % 1.3%-1.8 % Expected life of options 4.60 years 4.75 years 4.75 years Expected annual volatility 47%-48 % 47 % 47%-57 % Expected dividend yield none none none Risk free interest rate is based on yield curve rates published by the U.S. Expected life of options is based upon historical experience and represents the period of time that options granted are expected to be outstanding. Expected annual volatility is based on the volatility of Tower’s ordinary share prior to the options grant for the term identical to expected life. C. Israeli Banks’ Capital Notes and Warrants All issued and outstanding equity equivalent capital notes convertible into approximately 2.1 million ordinary shares as of December 31, 2016, have no voting rights, no maturity date, no dividend rights, are not tradable, are not registered, do not carry interest, are not linked to any index and are not redeemable. The equity equivalent capital notes are classified in shareholders’ equity. As of December 31, 2016, Bank Ha’poalim was the sole holder of such capital notes. As of December 31, 2016 and 2015, the Israeli Banks held a total of approximately 0.7 million warrants received under the Facility Agreement exercisable until December 2018, at various exercise prices ranging between $10.5 and $92.55 per share. D. Treasury Stock During 1999 and 1998, the Company funded the purchase by a trustee of an aggregate of 86,667 of Tower’s ordinary shares. These shares are classified as treasury shares. E. Dividend Restriction According to the Facility Agreement, F. Warrants Series 7 In connection with the issuance of Debentures Series F in 2012, see Note 13C above, the debenture holders received warrants exercisable into approximately 1.9 million ordinary shares of Tower based on an exercise price of approximately $7.2 per one ordinary share (“Warrants 7”). Warrants 7 were expiered on G. Warrants Series 9 In connection with a rights offering executed in 2013, the participants shareholders and certain other security holders received approximately 5.5 million Series 9 Warrants exercisable by June 2017 into ordinary shares with an exercise price of $7.33 per share. As of December 31, 2016 and 2015, the outstanding Series 9 Warrants were exercisable into approximately 2.3 million and 4.5 million ordinary shares, respectively. H. Convertible Debentures With regard to convertible Debentures, see Notes 13C and 13E. |
INFORMATION ON GEOGRAPHIC AREAS
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS | NOTE 18 - INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS A. Revenues by Geographic Area - as Percentage of Total Revenue Year ended December 31, 2016 2015 2014 USA 49 % 44 % 45 % Japan 36 41 40 Asia * 12 11 11 Europe 3 4 4 Total 100 % 100 % 100 % * Represents revenues from individual countries of less than 10% each. The basis of attributing revenues from external customers to geographic area is based on the headquarter location of the customer issuing the purchase order, actual delivery may be shipped to other geographic area per customer request. B. Long-Lived Assets by Geographic Area Substantially all of Tower’s long-lived assets are located in Israel, substantially all of Jazz’s and TJT’s long-lived assets are located in the United States and substantially all of TPSCo’s long-lived assets are located in Japan. As of December 31, 2016 2015 Israel $ 215,511 $ 176,764 United States 203,501 90,748 Japan 197,674 192,021 Total $ 616,686 $ 459,533 C. Major Customers - as Percentage of Net Accounts Receivable Balance Accounts receivable from significant customers representing 10% or more of the net accounts receivable balance as of December 31, 2016 and 2015, consist of the following customers: As of December 31, 2016 2015 Customer 1 23 % 29 % Customer 2 15 % 17 % D. Major Customers - as Percentage of Total Revenue Year ended December 31, 2016 2015 2014 Customer A 35 % 40 % 38 % Customer B 12 13 9 Other customers * 14 6 14 * Represents sales to two different customers accounted for 5% and 9% of sales during 2016, to one customer accounted for 6% of sales during 2015 and to two different customers accounted for 7% each during 2014. |
INTEREST EXPENSES, NET AND OTHE
INTEREST EXPENSES, NET AND OTHER FINANCING EXPENSES, NET | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
INTEREST EXPENSES, NET AND OTHER FINANCING EXPENSES, NET | NOTE 19 - INTEREST EXPENSES, NET AND OTHER FINANCING EXPENSES, NET A. Interest Expense, Net Interest expense net, for the years ended December 31, 2016, 2015 and 2014 were $11,857, $13,179 and $33,409, respectively. B. Other Financing Expense, Net Other financing expense, net consist of the following: Year ended December 31, 2016 2015 2014 Jazz Notes accretion and amortization $ 3,571 $ 3,015 $ 9,307 Jazz 2014 Exchange Agreement related financing costs, see Note 13E -- -- 9,817 Changes in fair value (total level 3 changes in fair value , see 7,900 16,092 (1,669 ) Debentures Series G amortization, rate differences and hedging results 1,901 -- -- Debentures Series F accretion and amortization including accelerated accretion, see Note 13C 150 87,973 39,494 Exchange rate differences (3,768 ) 1,056 (5,352 ) Others 2,738 1,794 3,807 $ 12,492 $ 109,930 $ 55,404 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 20 - INCOME TAXES A. Approved Enterprise Status Substantially all of Tower’s existing facilities and other capital investments have been granted approved enterprise status, as provided by the Investments Law. Pursuant to the Investments Law and the approval certificates, Tower’s income is taxed at a rate of 20% in 2016. The portion of Tower’s taxable income that is not attributable to approved enterprise status is taxed at a rate of 25% in 2016 (“Regular Company Tax”). The tax benefits are also conditioned upon fulfillment of the requirements stipulated by the letter of approval regarding Tower's facilities and other capital investments' approved enterprise status (“ Ktav Ishur B. Income Tax Provision The company’s income tax provision : Year Ended December 31, 2016 2015 2014 Current tax expense (benefit): Foreign (*)(**) $ 5,948 $ (8,473 ) $ 2,814 Deferred tax expense (benefit): Foreign(*) (4,516 ) (3,805 ) (27,556 ) Income tax expense (benefit) $ 1,432 $ (12,278 ) $ (24,742 ) (*) Foreign are considered provisions for Tower’s subsidiaries outside Israel. (**) Includes changes in unrecognized tax benefit, see D below. Year Ended December 31, 2016 2015 2014 Profit (loss) before taxes : Domestic $ 168,668 $ (59,797 ) $ 78,677 Foreign 41,930 18,392 (104,791 ) Total profit (loss) before taxes $ 210,598 $ (41,405 ) $ (26,114 ) C. Components of Deferred Tax Asset/Liability The following is a summary of the components of the deferred tax benefit and liability reflected in the balance sheets as of the respective dates: As of December 31, 2016 2015 Net deferred tax benefit - current: Net operating loss carryforward $ 797 $ 797 Employees benefits and compensation 3,895 3,984 Others 5,480 5,774 10,172 10,555 Valuation allowance , see F below (3,014 ) (3,519 ) Total net current deferred tax benefit $ 7,158 $ 7,036 As of December 31, 2016 2015 Deferred , net Deferred tax assets: Net operating loss carryforward $ 306,496 $ 327,924 Employees benefits and compensation 2,405 2,164 Research and development 1,940 1,940 Others 3,403 1,814 314,244 333,842 Valuation allowance , see F below (279,898 ) (304,195 ) $ 34,346 $ 29,647 Deferred tax liability: Depreciation and amortization (96,242 ) (51,238 ) Deferred tax related to gain on TPSCo acquisition (30,653 ) (44,423 ) Others (2,684 ) (3,730 ) Total long-term deferred tax liability , net $ (95,233 ) $ (69,744 ) D. Unrecognized Tax Benefit A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Unrecognized tax benefits Balance at January 1, 2016 $ 13,538 Additions for tax positions of current year 157 Expiration of prior years provision due to TJP closure (6,472 ) Additions for tax positions of prior years 779 Translation differences 967 Balance at December 31, 2016 $ 8,969 Unrecognized tax benefits Balance at January 1, 2015 $ 24,961 Additions for tax positions of current year (623 ) Expiration of statute of limitation of prior years (10,758 ) Translation differences (42 ) Balance at December 31, 2015 $ 13,538 Unrecognized tax benefits Balance at January 1, 2014 $ 25,676 Additions for tax positions of current year 51 Expiration of statute of limitation of prior years -- Translation differences (766 ) Balance at December 31, 2014 $ 24,961 E. Effective Income Tax Rates The reconciliation of the statutory tax rate to the effective tax rate is as follows: Year ended December 31, 2016 2015 2014 Tax expense (benefit) computed at statutory rates $ 52,650 $ (10,972 ) $ (6,920 ) Effect of different tax rates in different jurisdictions (4,772 ) 6,108 (18,453 ) Gain on acquisition (10,450 ) -- (33,280 ) Tax benefits for which deferred taxes were not recorded (23,489 ) 11,687 27,757 Unrecognized tax expense (benefit) (6,212 ) (11,153 ) 412 Permanent differences and other, net (6,295 ) (7,948 ) 5,742 Income tax expense (benefit) $ 1,432 $ (12,278 ) $ (24,742 ) F. Net Operating Loss Carryforward On December 31, 2016, Tower had net operating loss carryforward evidences The future utilization of Tower US Holdings’ net operating loss carryforward carryforward. carryforward On December 31, 2016, Tower US Holdings had state net operating loss carryforward of $137,900 that are expected to begin expiring in 2017 unless previously utilized. The full utilization of the remaining state net operating loss carryforward may not be available in the foreseeable future and may be significantly decreased based on the state filing method to be elected by Tower US Holdings, as since 2009, it adopted the word-wide method for California state taxes purposes . Moving As of December 31, 2016 and 2015, TPSCo had operating loss carryforward G. Final Tax Assessments Tower possesses final tax assessments through the year 1998. In addition, the tax assessments for the years 1999-2012 are deemed final. Tower US holding is filing the consolidated tax return including Jazz and TJT. Tower US Holdings and its subsidiaries are subject to U.S. federal income tax as well as income tax in multiple state and foreign jurisdictions. With few exceptions, Tower US Holdings is no longer subject to U.S. federal income tax examinations for 2010 and before, state and local income tax examinations for 2011 and before and foreign income tax examinations for 2012 and before. However, to the extent allowed by law, the tax authorities may have the right to examine prior periods where net operating losses were generated and carried forward, and make adjustments up to the amount of the net operating loss carryforward During 2016, the U.S. tax authorities commenced a regulatory audit of the Tower TPSCo was established in March 2014 and is subject to an income tax rate (including corporate tax, local tax, business enterprise tax) of approximately 33.5% and 35% for 2016 and 2015, respectively. |
RELATED PARTIES BALANCES AND TR
RELATED PARTIES BALANCES AND TRANSACTIONS | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES BALANCES AND TRANSACTIONS | NOTE 21 - RELATED PARTIES BALANCES AND TRANSACTIONS A. Balances The nature of the relationships involved As of December 31, 2016 2015 Long-term investment Equity investment in a limited partnership $ 37 $ 50 Trade accounts payable Trade accounts payable $ -- $ 52 B. Transactions Description of the transactions Year ended December 31, 2016 2015 2014 Cost of revenues Purchase of services and goods from affiliates of a related party. $ -- $ 13,970 $ 14,883 General and Administrative expenses Directors’ fees and reimbursement to directors $ 639 $ 234 $ 221 Other expense (income), net Equity loss (profit) in a limited partnership $ 13 $ (6 ) $ 16 |
ADDITIONAL INFORMATION - RECONC
ADDITIONAL INFORMATION - RECONCILIATION OF US GAAP TO IFRS | 12 Months Ended |
Dec. 31, 2016 | |
ADDITIONAL INFORMATION - RECONCILIATION OF US GAAP TO IFRS [Abstract] | |
ADDITIONAL INFORMATION - RECONCILIATION OF US GAAP TO IFRS | NOTE 22 - ADDITIONAL INFORMATION Since the initial listing of the Company on NASDAQ in the United States of America in 1993, the Company utilized US GAAP reports (prior to 2007 Israeli GAAP reconciled to US GAAP) in the preparation of its financial statements. As many of the Company’s investors and analysts are located in Israel and in Europe and are familiar with and use the International Financial Reporting Standards rules (“IFRS”), the Company provides on a voluntary basis a reconciliation from US A. Goodwill Adjustment arising from goodwill of a subsidiary acquired in 2008. The purchase consideration was paid in Tower’s ordinary shares. Under US GAAP, the consideration was measured according to Tower's share price at the transaction announcement date. Under IFRS, the consideration was measured according to Tower's share price at closing date. Accordingly, a lower purchase consideration was measured under IFRS than the purchase consideration measured under US GAAP. Consequently, no purchase price was allocated to goodwill under IFRS. B. Financial Instruments Adjustments arising from allocation of proceeds from issuance of convertible debentures and warrants to liabilities and equity and the subsequent measurement of such liabilities. The adjustment stems primarily from a convertible debt security sold by Tower in 2010, with a conversion ratio that was determined in the third quarter of 2012 based on Tower's share price as of such date. Under ASC 815 and ASC 470-20, the related conversion feature was measured in the third quarter of 2012 based on its intrinsic value and recorded to equity, with a corresponding discount on the debt instrument. Under IAS 39, such conversion feature was bifurcated from its host contract at the date of issuance and measured as a liability at fair value at each cut-off date until the date of determination of the related conversion ratio, at which date such conversion feature was classified to equity. C. Pension Plans Adjustments arising from defined benefit pension arrangements. Under ASC 715, prior years’ service cost, as well as actuarial gains and losses, are recorded in accumulated other comprehensive income, and amortized to the profit and loss statement over time. Under IAS 19, prior years’ service cost is recorded to the profit and loss statement in the period in which the underlying change was executed, while actuarial gains and losses, at the Company's election, are recorded directly to retained earnings with no impact on the profit and loss statement. D. Termination Benefits Adjustment arising from benefit to be granted to certain of the Company’s employees upon termination. Under IAS 19, such benefits are not reflected in the Company's financial statements until termination occurs. Under ASC 712, such benefits are recorded in earlier periods based on probability of occurrence. E. Condensed Balance Sheet in Accordance with IFRS: As of December 31, 2016 US GAAP Adjustments IFRS ASSETS: Current assets $ 697,998 $ -- $ 697,998 Property and equipment, net 616,686 -- 616,686 Long -t 65,200 (7,000 ) 58,200 Total assets $ 1,379,884 $ (7,000 ) $ 1,372,884 LIABILITIES AND SHAREHOLDERS' EQUITY: Current liabilities $ 247,115 $ -- $ 247,115 Long-term liabilities 450,155 (1,323 ) 448,832 Total liabilities 697,270 (1,323 ) 695,947 TOTAL SHAREHOLDERS’ EQUITY 682,614 (5,677 ) 676,937 Total liabilities and shareholders' equity $ 1,379,884 $ (7,000 ) $ 1,372,884 F. Condensed Statement of Operations in Accordance with IFRS: Year ended December 31, 2016 US GAAP Adjustments IFRS Profit before income tax and excluding other financing expense, net $ 223,090 $ (193 ) $ 222,897 Other financing expense, net (12,492 ) 143 (12,349 ) Profit before income tax expense 210,598 (50 ) 210,548 Income tax expense (1,432 ) -- (1,432 ) Profit for the period 209,166 (50 ) 209,116 Net income attributable to the non-controlling interest (5,242 ) -- (5,242 ) Net profit attributable to the company $ 203,924 $ (50 ) $ 203,874 G. Reconciliation of Net Profit (Loss) from US GAAP to IFRS: Year ended December 31, 2016 2015 2014 Net profit (loss) in accordance with US GAAP $ 203,924 $ (29,647 ) $ 4,263 Financial instruments 143 73,770 21,556 Pension plans (206 ) (705 ) (1,314 ) Termination benefits 13 (45 ) 409 Net profit in accordance with IFRS $ 203,874 $ 43,373 $ 24,914 H. Reconciliation of Shareholders’ Equity from US GAAP to IFRS: As of December 31, 2016 2015 Shareholders’ equity in accordance with US GAAP $ 682,614 $ 385,586 Financial instruments (237 ) (380 ) Termination benefits 1,560 1,502 Goodwill (7,000 ) (7,000 ) Shareholders’ equity in accordance with IFRS $ 676,937 $ 379,708 I. Reconciliation of Goodwill from US GAAP to IFRS: As of December 31, 2016 2015 Goodwill in accordance with US GAAP $ 7,000 $ 7,000 Goodwill (7,000 ) (7,000 ) Goodwill in accordance with IFRS $ -- $ -- J. Reconciliation of Other Long- Term As of December 31, 2016 2015 Other long-term assets in accordance with US GAAP $ 4,447 $ 5,903 Financial instruments -- (450 ) Other long-term assets in accordance with IFRS $ 4,447 $ 5,453 K. Reconciliation of Short-Term Debt and As of December 31, 2016 2015 Short-term debt and current $ 48,084 $ 33,259 Financial instruments -- (70 ) Short-term debt and current $ 48,084 $ 33,189 L. Reconciliation of Long -Term As of December 31, 2016 2015 Long - $ 162,981 $ 45,481 Financial instruments 237 -- Long - $ 163,218 $ 45,481 M. Reconciliation of Long-Term As of December 31, 2016 2015 Long-term employee $ 14,176 $ 14,189 Termination benefits (1,560 ) (1,502 ) Long-term employee $ 12,616 $ 12,687 |
SUMMARY OF SIGNIFICANT ACCOUN31
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Use of Estimates in Preparation of Financial Statements | A. Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with 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 from those estimates. |
Principles of Consolidation | B. Principles of Consolidation The Company’s consolidated financial statements include the financial statements of Tower and its subsidiaries. The Company’s consolidated financial statements are presented after elimination of inter-company transactions and balances. The Company’s consolidated financial statements include TPSCo’s balance sheet since March 31, 2014 and TPSCo’s results of operations from April 1, 2014 and TJT’s results of operations and balance sheet since February 1, 2016. |
Cash and Cash Equivalents, Short-Term Deposits | C. Cash and Cash Equivalents, Short-Term Deposits Cash and cash equivalents consist of cash, bank deposits and short - -term |
Allowance for Doubtful Accounts | D. Allowance for Doubtful Accounts The allowance for doubtful accounts is computed on the specific identification basis for accounts whose collectability, in the Company’s estimation, is uncertain. As of December 31, 2016 and 2015, the amounts in the allowance for doubtfull accounts are immaterial. |
Inventories | E. Inventories Inventories are stated at the lower of cost or market. Cost for raw materials and supplies is determined is determined |
Property and Equipment | F. Property and Equipment The Company accounts for property and equipment in accordance with Accounting Standards Codification (“ASC”) 360 “ ” Property and equipment are presented net of investment grants received, and less accumulated depreciation . Depreciation is calculated based on the straight-line method over the Company’s estimated useful lives of the assets or terms of the related leases, as follows: Buildings and building improvements, including facility infrastructure 10-25 years Machinery and equipment, software and hardware 3-15 years In connection with the periodic review of the estimated useful lives of property and equipment at the Company’s foundry manufacturing facilities, the Company determined during 2015, that the estimated useful lives of machinery and equipment should be extended to 15 years from 7 years and the estimated useful lives of facility infrastructure should be extended to 25 years from 14 years. The Company extended the estimated useful lives of these assets as a result of the extended use of mature technologies, longer processes and product life cycles, the versatility of manufacturing equipment, facility systems and infrastructure to provide better flexibility to meet changes in customer demand and the ability to re-use equipment over several technology cycles significantly extending the estimated usage period of such assets. For further details, see Note 8A. Impairment charges, if needed, are determined based on the policy outlined in R below. |
Intangible Assets | G. Intangible Assets The Company accounts for intangible assets in accordance with ASC 350 “ ” The amounts attributed to intangible assets as part of the purchase price allocations for the acquisitions are amortized over the expected estimated economic life of the intangible assets commonly used in the industry. Impairment charges, if needed, are determined based on the policy outlined in R below. |
Other Assets | H. Other Assets Other Assets include mainly prepaid long-term lease payments to the Israel Land Administration (“ILA”) for the land on which the company’s Israeli fabs are established, net of accumulated amortization over the lease period, see also Note 16C . |
Convertible Debentures | I. Convertible Debentures Under ASC 470-20 “Debt with Conversion and Other Options”, the proceeds from the sale of debt securities with detachable conversion feature and other options, are allocated to each of the securities issued based on their relative fair value. For more information about Convertible debentures see Note 13 |
Stock-Based Instruments in Financing Transactions | J. Stock-Based Instruments in Financing Transactions The Company calculates the fair value of stock-based instruments included in the units issued in its financing transactions. That fair value is recognized in equity, if determined to be eligible for equity classification. The fair value of such stock-based instruments, when included in issuance of debt that is not itself accounted at fair value , |
Revenue Recognition | K. Revenue Recognition The Company’s revenues are generated principally from sales of semiconductor wafers. The Company also derives revenues from design support and other technical and support services incidental to the sale of semiconductor wafers. The vast majority of the Company’s sales are achieved through the effort of its direct sales force. In accordance with ASC Topic 605 “Revenue Recognition”, the Company recognizes revenues from sale of products when the following fundamental criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred or services have been rendered; (iii) the price to the customer is fixed or determinable; and (iv) collection of the resulting receivable is reasonably assured. Generally, delivery occurs after products meet all of the customer’s acceptance criteria based on pre-shipment electronic, functional and quality tests. The Company provides for sales returns allowance relating to specified yield or quality commitments as a reduction of revenues based on past experience and specific identification of events necessitating an allowance. |
Research and Development | L. Research and Development Research and development costs are charged to operations as incurred. Amounts received or receivable from the government of Israel and others, as participation in research and development programs, are offset against research and development costs. The accrual for grants receivable is determined based on the terms of the programs, provided that the criteria for entitlement have been met. |
Income Taxes | M. Income Taxes The Company accounts for income taxes using an asset and liability approach as prescribed in ASC 7 40-10 “ Income Taxes ” (“ASC 740-10” The Company evaluates realizability of its deferred tax assets for each jurisdiction in which the Company operates at each reporting date, and establishes valuation allowances when it is more likely than not that all or a part of its deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the same character and in the same jurisdiction. The Company considers all available positive and negative evidence in making this assessment, including, but not limited to, the scheduled reversal of deferred tax liabilities and projected future taxable income. In circumstances where there is sufficient negative evidence indicating that the Company's deferred tax assets are not more-likely-than-not realizable, the Company establishes a valuation allowance. ASC 740-10 prescribes a two-step approach for recognizing and measuring uncertain tax positions. The first step is to evaluate tax positions taken or expected to be taken in a tax return by assessing whether they are more-likely-than-not sustainable, based solely on their technical merits, upon examination and including resolution of any related appeals or litigation process. The second step is to measure the associated tax benefit of each position as the largest amount that the Company believes is more-likely-than-not realizable. Differences between the amount of tax benefits taken or expected to be taken in its income tax returns and the amount of tax benefits recognized in its financial statements, represent the Company's unrecognized income tax benefits. The Company's policy is to include interest and penalties related to unrecognized income tax benefits as a component of income tax expense. |
Earnings (Loss) Per Ordinary Share | N. Earnings (Loss) Per Ordinary Share Basic earnings (loss) per share are calculated in accordance with ASC 260, “Earnings Per Share” ("ASC 260") by dividing profit or loss attributable to ordinary equity holders of Tower (the numerator) by the weighted average number of ordinary shares outstanding during the reported period (the denominator). Diluted earnings per share are |
Comprehensive Income (Loss) | O. Comprehensive Income (Loss) In accordance with ASC 220 “Comprehensive Income” ("ASC 220"), comprehensive income (loss) represents the change in shareholders’ equity during a reporting period from transactions and other events and circumstances from non-owner sources. It includes all changes in equity during a reporting period except those resulting from investments by owners and distributions to owners. Other comprehensive income (loss) (“OCI”) represents gains and losses that are included in comprehensive income but excluded from net income. |
Functional Currency and Exchange Rate Losses | P. Functional Currency and Exchange Rate Losses The currency of the primary economic environment in which Tower, TJT and Jazz conduct their operations is the U.S. Dollar rate |
Stock-Based Compensation | Q. Stock-Based Compensation The Company applies the provisions of ASC Topic 718 “Compensation - Stock Compensation”, under which employees’ share-based equity awards are accounted for under the fair value method. Accordingly, stock-based compensation granted to employees and directors is measured at the grant date, based on the fair value of the grant. The Company uses the straight-line attribution method to recognize stock-based compensation costs over the vesting period of the grant, except for grants that involve performance criteria , |
Impairment of Assets | R. Impairment of Assets Impairment of Property, Equipment and Intangible Assets The Company reviews long-lived assets and intangible assets on a periodic basis, as well as when such a review is required based upon relevant circumstances, to determine whether events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable, considering the undiscounted cash flows expected from it. If applicable, the Company recognizes an impairment loss based upon the difference between the carrying amount and the fair value of such assets, in accordance with ASC 360-10 “Property, Plant and Equipment”. Impairment of Goodwill Goodwill is subject to an impairment test performed at least on an annual basis or upon the occurrence of certain events or circumstances. The goodwill impairment test is performed based on the result of an initial qualitative assessment for the likelihood of impairment. If this assessment does not result in a more-likely-than-not indication of impairment, no further impairment testing is required. If it does result in a more-likely-than-not indication of impairment, the impairment test is performed. Goodwill impairment is assessed based on a comparison of the fair value of the unit to which the goodwill is ascribed, and the underlying carrying value of its net assets, including goodwill. If the carrying amount of the unit exceeds its fair value, the implied fair value of the goodwill is compared with its carrying amount to measure the amount of impairment loss, if any. The Company uses the income approach methodology of valuation that includes discounted cash flows to determine the fair value of the unit. Significant management judgment is required in the forecasts of future operating results used for this methodology. |
Classification of Liabilities and Equity | S. Classification of Liabilities and Equity Tower applies ASC 815-40 “Contract in Entity’s Own Equity” in determining whether an instrument that may be settled in Tower’s shares is also considered indexed to a company’s own stock, for the purpose of classification of the instrument as a liability or equity. |
Derivatives and hedging | T. Derivatives and hedging Derivative instruments are recognized as either assets or liabilities and are measured at fair value. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation. For derivative instruments designated as fair value hedges, the gains (losses) are recognized in earnings in the periods of change together with the offsetting losses (gains) on the hedged items attributed to the risk being hedged. For derivative instruments designated as cash flow hedges, the effective portion of the gains (losses) on the derivatives is initially reported as a component of OCI and is subsequently recognized in earnings when the hedged exposure is recognized in earnings. Gains (losses) on derivatives representing either hedge components excluded from the assessment of effectiveness or hedge ineffectiveness are recognized in earnings. For derivative instruments that are not designated as hedges, gains (losses) from changes in fair values are primarily recognized in the same line of the item economiclly hedged. |
Reclassification and Presentation | U. Reclassification and Presentation Certain amounts in prior years’ financial statements have been reclassified in order to conform to the 2016 presentation. |
Recently Issued Accounting Pronouncements | V. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for revenue recognition in Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” recently ASU 2014-09 is effective January 1, 2018. Early adoption is permitted but not before January 1, 2017. Should be In November 2015, the FASB issued ASU 2015-17 “ Balance Sheet Classification of Deferred Taxes ”. In April 2015, the FASB issued 2015-03 “Interest Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ”. financing As a result of the retrospective adoption of ASU 2015-03 effective January 1, 2016, deferred financing costs of approximately $856, previously classified within long-term assets. were applied to reduce the related debt liabilities as of December 31, 2015. In 2016, issuance expenses relating to Series G Debentures and to the bank loan to TJT were deducted accordingly from the debt liability carrying amounts. In January 2016, the FASB issued ASU 2016-01 it’s In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842 )”, leases In March 2016, the FASB issued ASU 2016-09 ,“ Compensation - Stock Compensation (Topic 718 )”. The update requires that the adoption related to forfeitures be accounted for using the modified retrospective method where the effect of the change relating to previous years was to be recognized as an adjustment to the opening balance of retained earnings. The amount of the adjustment related to previous years is approximately $1,300 . In June 2016, the FASB issued ASU 2016-13 “Financial Instruments Credit Losses”. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. The Company has previously incurred immaterial amount of bad debt and expecting no material impact from adopting this guidance on its consolidated financial statements and disclosures. In November 2016, the FASB issued ASU 2016-18 |
SUMMARY OF SIGNIFICANT ACCOUN32
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Economic Lives | Depreciation is calculated based on the straight-line method over the Company’s estimated useful lives of the assets or terms of the related leases, as follows: Buildings and building improvements, including facility infrastructure 10-25 years Machinery and equipment, software and hardware 3-15 years |
RECENT ACQUISITIONS (Tables)
RECENT ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | The allocation of fair value to the assets acquired and liabilities assumed is as follows: As of February 1, 2016 Current assets $ 14,342 Tangible assets 106,919 Intangible assets 2,799 Total assets as of acquisition date $ 124,060 Customer advance $ 2,310 Other current liabilities 1,257 Deferred tax liability 28,021 Liabilities incurred as of acquisition date $ 31,588 Consideration payable through Tower’s shares issued $ 40,000 Gain from acquisition (*) $ 52,472 (*) Gain from acquisition is presented in the Statement of Operations net of $2,001 acquisition related costs. |
RESTRUCTURING OF JAPAN OPERAT34
RESTRUCTURING OF JAPAN OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of restructuring and asset impairment activity | Changes in TJP facility closure related accruals for the years ended December 31, 2015 and 2016 were as follows: Asset impairment and related costs (*) Other restructuring Total Accrued balance as of December 31, 2014 $ 1,196 $ 3,407 $ 4,603 Assets impairment related costs and other restructuring charges 3,200 4,116 7,316 Reduction of prior accrual and impairment (5,841 ) (2,466 ) (8,307 ) Charges against accrual 5,841 -- 5,841 Cash payments (1,296 ) (3,113 ) (4,409 ) Accrued balance as of December 31, 2015 $ 3,100 $ 1,944 $ 5,044 Reduction of prior accrual (986 ) -- (986 ) Charges against accrual -- 359 359 Cash payments (321 ) (2,303 ) (2,624 ) Accrued balance as of December 31, 2016 $ 1,793 $ -- $ 1,793 (*) Charges associated with asset impairment represent the write-down of the related assets to their new fair value and are recorded concurrently with the recognition of the accrual. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consist of the following: As of December 31, 2016 2015 Raw materials $ 26,296 $ 27,848 Work in process 105,564 73,437 Finished goods 5,672 4,396 $ 137,532 $ 105,681 |
OTHER CURRENT ASSETS (Tables)
OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Summary of Other Current Assets | Other current assets consist of the following: As of December 31, 2016 2015 Receivables from tax authorities $ 9,620 $ 6,913 Deferred taxes 7,158 7,036 Prepaid expenses 6,610 10,570 TJT acquisition related Receivable, 5,000 -- Others 1,653 887 $ 30,041 $ 25,406 |
LONG-TERM INVESTMENTS (Tables)
LONG-TERM INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Long-Term Investments | Long-term investments consist of the following: As of December 31, 2016 2015 Severance pay funds (see Note 15) $ 9,909 $ 10,015 Long-term interest bearing bank deposit 12,500 -- Others 3,215 1,722 $ 25,624 $ 11,737 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | As of December 31, 2016 2015 Original cost: Buildings (including facility infrastructure) $ 333,696 $ 292,303 Machinery and equipment 2,093,204 1,808,411 $ 2,426,900 $ 2,100,714 Accumulated depreciation: Buildings (including facility infrastructure) (205,604 ) (197,518 ) Machinery and equipment (1,604,610 ) (1,443,663 ) (1,810,214 ) (1,641,181 ) $ 616,686 $ 459,533 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Intangible Assets, Net | Intangible assets consist of the following as of December 31, 2016: Useful Life (years) Cost Accumulated Amortization Net Technologies 4;5;9 $ 109,543 $ (98,354 ) $ 11,189 Facilities lease 19 33,500 (20,377 ) 13,123 Patents and other core technology rights 9 15,100 (13,903 ) 1,197 Trade name 9 7,520 (6,064 ) 1,456 Customer relationships 15 2,600 (1,436 ) 1,164 Others -- 1,000 (1,000 ) -- Total identifiable intangible assets $ 169,263 $ (141,134 ) $ 28,129 Intangible assets consist of the following as of December 31, 2015: Useful Life (years) Cost Accumulated Amortization Net Technologies 4;5;9 $ 106,363 $ (93,048 ) $ 13,315 Facilities lease 19 33,500 (19,089 ) 14,411 Patents and other core technology rights 9 15,100 (12,225 ) 2,875 Trade name 9 7,455 (5,000 ) 2,455 Customer relationships 15 2,600 (1,263 ) 1,337 Others -- 1,000 (925 ) 75 Total identifiable intangible assets $ 166,018 $ (131,550 ) $ 34,468 |
OTHER ASSETS, NET (Tables)
OTHER ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Assets, Net | Other assets, net consist of the following: As of December 31, 2016 2015 Prepaid long-term land lease, net (see Note 16C) $ 3,537 $ 3,658 Long term prepaid expenses and others 910 2,245 $ 4,447 $ 5,903 |
OTHER CURRENT LIABILITIES (Tabl
OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities, Current [Abstract] | |
Schedule of Other Current Liabilities | Other current liabilities consist of the following: As of December 31, 2016 2015 Interest payable $ 4,683 $ 2,138 Restructuring related payables 1,793 5,044 Tax authorities payables 10,342 7,645 Others 7,265 3,153 $ 24,083 $ 17,980 |
LONG-TERM LOANS FROM BANKS (Tab
LONG-TERM LOANS FROM BANKS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Loans Payable [Abstract] | |
Schedule of Long-Term Debt From Banks | As of December 31, 2016 2015 In U.S. Dollars, see also B, Cand E below $ 40,000 $ 101,955 In JPY, see also D below 126,376 143,675 Total long-term loans from banks 166,376 245,630 Fair value adjustments -- (7,900 ) Deferred issuance costs (1,344 ) (511 ) Total long-term loans from banks 165,032 237,219 Current maturities (31,869 ) (26,681 ) $ 133,163 $ 210,538 |
DEBENTURES (Tables)
DEBENTURES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Notes Payable [Abstract] | |
Schedule of Maturities of Debentures | As of December 31, 2016 Interest rate 2017 2018 2019 2020 2021 2022 and on Total Debentures Series D 8% $ 5,977 $ -- $ -- $ -- $ -- $ -- $ 5,977 Debentures Series F 7.8% 238 -- -- -- -- -- 238 Debentures Series G 2.79% -- -- -- 34,776 34,776 52,165 121,717 Jazz’s Notes (as defined in E 8% -- 58,307 -- -- -- -- 58,307 Total outstanding principal amounts of debentures $ 6,215 $ 58,307 $ -- $ 34,776 $ 34,776 $ 52,165 $ 186,239 Accretion of carrying amount to principal amount (17,043 ) Carrying amount $ 169,196 As of December 31, 2015 Interest rate 2016 2017 2018 Total Debentures Series D 8% $ 5,906 $ -- $ -- $ 5,906 Debentures Series F 7.8% 851 -- -- 851 Jazz’s Notes (as defined in E below ) 8% -- -- 58,307 58,307 Total outstanding principal amounts of debentures $ 6,757 $ -- $ 58,307 $ 65,064 Accretion of carrying amount to principal amount (13,005 ) Carrying amount $ 52,059 |
FINANCIAL INSTRUMENTS AND FAI44
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASURMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS [Abstract] | |
Schedule of Recurring Fair Value Measurements | Recurring Fair Value Measurements Using the Indicated Inputs: December 31, 2016 Quoted prices in active market for identical liability (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Cross currency swap- liability position $ 67 -- $ 67 -- Foreign Exchange forward and cylinders- liability position 976 976 -- $ 1,043 $ -- $ 1,043 $ -- December 31, 2015 Quoted prices in active market for identical liability (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Tower’s loans (including current maturities) $ 74, 891 $ -- $ -- $ 74, 891 Foreign - liability position 64 64 $ 74, 955 $ -- $ 64 $ 74, 891 |
Schedule of Liabilities Measured on a Recurring Basis Using Significant Unobservable Inputs | Liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Tower’s Israeli Banks Loans (including current maturities) Others As of January 1, 2016 - at fair value $ 74,955 $ -- principal repayment (82,855 ) -- Total changes in fair value recognized in earnings 7,900 -- As of December 31, 2016 - at fair value $ -- $ -- Tower’s loans (including current maturities) Others As of January 1, 2015 - at fair value $ 77,029 $ 34 Loan repayment (18,200 ) -- Total changes in fair value recognized in earnings 16,126 (34 ) As of December 31, 2015 - at fair value $ 74,955 $ -- Unrealized losses recognized in earnings related to outstanding loans as of December 31, 2015 $ 13,219 $ -- |
EMPLOYEE RELATED LIABILITIES (T
EMPLOYEE RELATED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Postretirement Medical Plan [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Schedule of Net Periodic Benefit Cost | The components of the net periodic benefit cost and other amounts recognized in other comprehensive income (loss) for post-retirement medical plan expense are as follows: Year ended December 31, 2016 2015 2014 Net periodic benefit cost: Service cost $ 12 $ 29 $ 24 Interest cost 85 126 118 Amortization of prior service costs (12 ) (973 ) (1,737 ) Amortization of net (gain) or loss (333 ) (115 ) (227 ) Total net periodic benefit cost $ (248 ) $ (933 ) $ (1,822 ) |
Schedule of Amounts Recognized in Other Comprehensive Income | Other changes in plan assets and benefits obligations recognized in other comprehensive income: Prior service cost for the period $ -- $ -- $ -- Net (gain) or loss for the period (316 ) (1,333 ) 558 Amortization of prior service costs 12 973 1,737 Amortization of net gain or (loss) 333 115 227 Total recognized in other comprehensive income (expense) $ 29 $ (245 ) $ 2,522 Total recognized in net periodic benefit cost and other comprehensive income $ (219 ) $ (1,178 ) $ 700 |
Schedule of Impact of One-Percentage-Point Change in Assumed Health Care Cost | Impact of one-percentage point change in assumed health care cost trend rates as of December 31, 2016: Increase Decrease Effect on service cost and interest cost $ 7 $ (5 ) Effect on post-retirement benefit obligation $ 59 $ (46 ) |
Schedule of changes in Projected Benefit Obligations, Fair Value of Plan Assets, and Funded Status | The components of the change in benefit obligation, change in plan assets and funded status for post-retirement medical plan are as follows: Year ended December 31, 2016 2015 2014 Change in benefit obligation: Benefit obligation at beginning of period $ 1,781 $ 2,977 $ 2,317 Service cost 12 29 24 Interest cost 85 126 118 Benefits paid (12 ) (18 ) (40 ) Change in plan provisions -- -- -- Actuarial loss (gain) (316 ) (1,333 ) 558 Benefit obligation end of period $ 1,550 $ 1,781 $ 2,977 Change in plan assets: Fair value of plan assets at beginning of period $ -- $ -- $ -- Employer contribution 12 18 40 Benefits paid (12 ) (18 ) (40 ) Fair value of plan assets at end of period $ -- $ -- $ -- Funded status $ (1,550 ) $ (1,781 ) $ (2,977 ) |
Schedule of Amounts Recognized in Statement of Financial Position | As of December 31, 2016 2015 2014 Amounts recognized in statement of financial position: Current liabilities (37 ) (40 ) (83 ) Non-current liabilities (1,513 ) (1,741 ) (2,894 ) Net amount recognized $ (1,550 ) $ (1,781 ) $ (2,977 ) Weighted average assumptions used: Discount rate 4.50 % 4.80 % 4.30 % Rate of compensation increases N/A N/A N/A Assumed health care cost trend rates: Health care cost trend rate assumed for next year (pre 65/ post 65) 7.20%/10.00 % 6.75%/10.00 % 7.00%/20.00 % Ultimate rate (pre 65/ post 65) 4.50%/4.50 % 4.50%/5.00 % 4.50%/5.00 % Year the ultimate rate is reached (pre 65/ post 65) 2025/2025 2025/2022 2025/2022 |
Schedule of Future Benefit Payments | The following benefit payments are expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter: Fiscal Year Other Benefits 2017 $ 37 2018 48 2019 59 2020 66 2021 67 2022-2026 $ 346 |
Schedule of Weighted Average Assumptions Used | Weighted average assumptions used: Discount rate 4.80 % 4.30 % 5.20 % Expected return on plan assets N/A N/A N/A Rate of compensation increases N/A N/A N/A Assumed hea |
Schedule of Health Care Cost Trend Rates | Assumed health care cost trend rates: Health care cost trend rate assumed for current year (Pre-65/Post-65) 6.75%/10.00 % 7.00%/20.00 % 7.75%/25.00 % Ultimate rate (Pre-65/Post-65) 4.50%/5.00 % 4.50%/5.00 % 5.00%/5.00 % Year the ultimate rate is reached (Pre-65/Post-65) 2025/2022 2025/2022 2022/2022 Measurement date December 31, 2016 December 31, 2015 December 31, 2014 |
Pension Plan [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Schedule of Net Periodic Benefit Cost | The components of the change in benefit obligation, the change in plan assets and funded status for Jazz’s pension plan are as follows: Year ended December 31, 2016 2015 2014 Net periodic benefit cost: Interest cost 841 798 796 Expected return on plan assets (1,154 ) (1,130 ) (1,257 ) Amortization of prior service costs 3 3 3 Amortization of net (gain) or loss 34 31 -- Total net periodic benefit cost $ (276 ) $ (298 ) $ (458 ) |
Schedule of Amounts Recognized in Other Comprehensive Income | Other changes in plan assets and benefits obligations recognized in other comprehensive income: Prior service cost for the period $ -- $ -- $ -- Net (gain) or loss for the period 736 6 3,117 Amortization of prior service costs (3 ) (3 ) (3 ) Amortization of net gain or (loss) (34 ) (31 ) -- Total recognized in other comprehensive income (expense) $ 699 $ (28 ) $ 3,114 Total recognized in net periodic benefit cost and other comprehensive income (expense) $ 423 $ (326 ) $ 2,656 |
Schedule of Estimated Amounts in Accumulated Other Comprehensive Income to be Recognized over the Next Fiscal Year | Year ended December 31, 2016 2015 2014 Estimated amounts that will be amortized from accumulated other comprehensive income in the next fiscal year ending : Prior service cost 3 3 3 Net actuarial (gain) or loss $ 54 $ 33 $ 31 |
Schedule of changes in Projected Benefit Obligations, Fair Value of Plan Assets, and Funded Status | The components of the change in benefit obligation, change in plan assets and funded status for Jazz’s pension plan are as follows: Year ended December 31, 2016 2015 2014 Change in benefit obligation: Benefit obligation at beginning of period $ 18,605 $ 19,304 $ 15,873 Interest cost 841 798 796 Benefits paid (496 ) (451 ) (532 ) Change in plan provisions -- -- -- Actuarial loss (gain) 722 (1,046 ) 3,167 Benefit obligation end of period $ 19,672 $ 18,605 $ 19,304 Change in plan assets: Fair value of plan assets at beginning of period $ 18,526 $ 18,134 $ 16,652 Actual return on plan assets 1,141 78 1,307 Employer contribution 700 765 707 Benefits paid (496 ) (451 ) (532 ) Fair value of plan assets at end of period $ 19,871 $ 18,526 $ 18,134 Funded status $ 199 $ (79 ) $ (1,170 ) Accumulated benefit obligation $ 19,672 $ 18,605 $ 19,304 |
Schedule of Amounts Recognized in Statement of Financial Position | Amounts recognized in statement of financial position: Non-current assets $ 199 $ -- $ -- Non-current liabilities -- (79 ) (1,170 ) Net amount recognized $ 199 $ (79 ) $ (1,170 ) Weighted average assumptions used: Discount rate 4.30 % 4.60 % 4.20 % Rate of compensation increases N/A N/A N/A |
Schedule of Future Benefit Payments | The following benefit payments are expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter: Fiscal Year Other Benefits 2017 $ 706 2018 797 2019 866 2020 943 2021 999 2022-2026 $ 5,719 |
Schedule of Weighted Average Assumptions Used | Weighted average assumptions used: Discount rate 4.60 % 4.20 % 5.10 % Expected return on plan assets 6.20 % 6.20 % 7.50 % Rate of compensation increases N/A N/A N/A |
Schedule of Weighted Average Asset Allocations | Jazz’s pension plan weighted average asset allocations on December 31, 2016, by asset category are as follows: Asset Category: December 31, 2016 Target allocation 2017 Equity securities 62 % 60 % Debt securities 38 % 40 % Real estate 0 % 0 % Other 0 % 0 % Total 100 % 100 % |
Schedule of Assets Measured at Fair Value on a Recurring Basis | The plan’s assets measured at fair value on a recurring basis consisted of the following as of as of December 31, 2016: Level 1 Level 2 Level 3 Investments in mutual funds $ -- $ 19,871 $ -- Total plan assets at fair value $ -- $ 19,871 $ -- The plan’s assets measured at fair value on a recurring basis consisted of the following as of as of December 31, 2015: Level 1 Level 2 Level 3 Investments in mutual funds $ -- $ 18,526 $ -- Total plan assets at fair value $ -- $ 18,526 $ -- |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Share Option Activity | 2016 2015 2014 Number Weighted average exercise price Number Weighted average exercise price Number Weighted average exercise price Outstanding as of beginning of year 5,878,270 $ 6.84 7,537,219 $ 6.37 8,066,749 $ 6.31 Granted 207,890 12.19 100,000 16.92 746,431 5.81 Exercised (3,649,754 ) 4.82 (1,620,056 ) 4.94 (762,607 ) 4.36 Terminated (97,063 ) 21.34 (26,777 ) 22.28 (30,901 ) 35.40 Forfeited (61,254 ) 7.25 (112,116 ) 8.30 (482,453 ) 5.86 Outstanding as of end of year 2,278,089 9.92 5,878,270 6.84 7,537,219 6.37 Options exercisable as of end of year 1,606,983 $ 10.19 2,606,704 $ 8.93 1,834,281 $ 11.54 |
Schedule of Restricted Shares Units Activity | 2016 2015 Number Weighted Average Fair Value Number Weighted Average Fair Value Outstanding as of beginning of year 773,200 $ 15.11 -- $ -- Granted 359,643 12.83 783,700 15.11 Exercised (86,847 ) 11.45 -- -- Forfeited (36,812 ) 14.73 (10,500 ) 15.15 Outstanding as of end of year 1,009,184 14.62 773,200 15.11 RSU exercisable as of end of year -- $ -- -- $ -- |
Schedule of Information about Share Options Outstanding | The following table summarizes information about employees’ share options outstanding as of December 31, 2016: Outstanding as of December 31, 2016 Exercisable as of December 31, 2016 Range of exercise Number outstanding Weighted average remaining contractual life Weighted average exercise price Number exercisable Weighted average exercise price $ 4.42-13.20 1,613,375 4.25 $ 6.08 1,032,269 $ 4.95 15.90-19.50 421,878 2.30 17.01 331,878 17.04 $ 21.00-28.20 242,836 0.88 $ 23.10 242,836 $ 23.10 2,278,089 1,606,983 |
Schedule of Intrinsic and Fair Values for Options Exercised | Year ended December 31, 2016 2015 2014 The intrinsic value of options exercised $ 40,314 $ 15,374 $ 3,680 The original fair value of options exercised $ 16,711 $ 3,721 $ 2,661 |
Schedule of Intrinsic and Fair Values for RSU's Exercised | Year ended December 31, 2016 2015 2014 The intrinsic value of RSU's exercised $ 1,177 $ -- $ -- The original fair value of RSU's exercised $ 994 $ -- $ -- |
Schedule of Stock-Based Compensation Expense in Statement of Operations | Stock-based compensation expenses were recognized in the Statement of Operations as follows: Year ended December 31, 2016 2015 2014 Cost of goods $ 3,920 $ 2,214 $ 753 Research and development, net 2,119 1,905 1,034 Marketing 3,367 3,421 2,897 Total stock $ 9,406 $ 7,540 $ 4,684 |
Schedule of Fair Value of Options Granted | The Company estimated the fair value, utilizing the following assumptions for the years 2016, 2015 and 2014 (all in weighted averages): 2016 2015 2014 Risk-free interest rate 0.9%-1.3 % 1.2%-1.4 % 1.3%-1.8 % Expected life of options 4.60 years 4.75 years 4.75 years Expected annual volatility 47%-48 % 47 % 47%-57 % Expected dividend yield none none none |
INFORMATION ON GEOGRAPHIC ARE47
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenues by Geographic Area | Year ended December 31, 2016 2015 2014 USA 49 % 44 % 45 % Japan 36 41 40 Asia * 12 11 11 Europe 3 4 4 Total 100 % 100 % 100 % * Represents revenues from individual countries of less than 10% each. |
Schedule of Long-Lived Assets by Geographic Area | As of December 31, 2016 2015 Israel $ 215,511 $ 176,764 United States 203,501 90,748 Japan 197,674 192,021 Total $ 616,686 $ 459,533 |
Schedule of Accounts Receivable of Major Customers | Accounts receivable from significant customers representing 10% or more of the net accounts receivable balance as of December 31, 2016 and 2015, consist of the following customers: As of December 31, 2016 2015 Customer 1 23 % 29 % Customer 2 15 % 17 % |
Schedule of Revenues of Major Customers | Year ended December 31, 2016 2015 2014 Customer A 35 % 40 % 38 % Customer B 12 13 9 Other customers * 14 6 14 * Represents sales to two different customers accounted for 5% and 9% of sales during 2016, to one customer accounted for 6% of sales during 2015 and to two different customers accounted for 7% each during 2014. |
INTEREST EXPENSES, NET AND OT48
INTEREST EXPENSES, NET AND OTHER FINANCING EXPENSES, NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
Schedule of Financing Expense | Year ended December 31, 2016 2015 2014 Jazz Notes accretion and amortization $ 3,571 $ 3,015 $ 9,307 Jazz 2014 Exchange Agreement related financing costs, see Note 13E -- -- 9,817 Changes in fair value (total level 3 changes in fair value , see 7,900 16,092 (1,669 ) Debentures Series G amortization, rate differences and hedging results 1,901 -- -- Debentures Series F accretion and amortization including accelerated accretion, see Note 13C 150 87,973 39,494 Exchange rate differences (3,768 ) 1,056 (5,352 ) Others 2,738 1,794 3,807 $ 12,492 $ 109,930 $ 55,404 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Provision | The company’s income tax provision : Year Ended December 31, 2016 2015 2014 Current tax expense (benefit): Foreign (*)(**) $ 5,948 $ (8,473 ) $ 2,814 Deferred tax expense (benefit): Foreign(*) (4,516 ) (3,805 ) (27,556 ) Income tax expense (benefit) $ 1,432 $ (12,278 ) $ (24,742 ) (*) Foreign are considered provisions for Tower’s subsidiaries outside Israel. (**) Includes changes in unrecognized tax benefit, see D below. |
Schedule of Profit (Loss) Before Taxes | Year Ended December 31, 2016 2015 2014 Profit (loss) before taxes : Domestic $ 168,668 $ (59,797 ) $ 78,677 Foreign 41,930 18,392 (104,791 ) Total profit (loss) before taxes $ 210,598 $ (41,405 ) $ (26,114 ) |
Schedule of Deferred Tax Asset/Liability | The following is a summary of the components of the deferred tax benefit and liability reflected in the balance sheets as of the respective dates: As of December 31, 2016 2015 Net deferred tax benefit - current: Net operating loss carryforward $ 797 $ 797 Employees benefits and compensation 3,895 3,984 Others 5,480 5,774 10,172 10,555 Valuation allowance , see F below (3,014 ) (3,519 ) Total net current deferred tax benefit $ 7,158 $ 7,036 As of December 31, 2016 2015 Deferred , net Deferred tax assets: Net operating loss carryforward $ 306,496 $ 327,924 Employees benefits and compensation 2,405 2,164 Research and development 1,940 1,940 Others 3,403 1,814 314,244 333,842 Valuation allowance , see F below (279,898 ) (304,195 ) $ 34,346 $ 29,647 Deferred tax liability: Depreciation and amortization (96,242 ) (51,238 ) Deferred tax related to gain on TPSCo acquisition (30,653 ) (44,423 ) Others (2,684 ) (3,730 ) Total long-term deferred tax liability , net $ (95,233 ) $ (69,744 ) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Unrecognized tax benefits Balance at January 1, 2016 $ 13,538 Additions for tax positions of current year 157 Expiration of prior years provision due to TJP closure (6,472 ) Additions for tax positions of prior years 779 Translation differences 967 Balance at December 31, 2016 $ 8,969 Unrecognized tax benefits Balance at January 1, 2015 $ 24,961 Additions for tax positions of current year (623 ) Expiration of statute of limitation of prior years (10,758 ) Translation differences (42 ) Balance at December 31, 2015 $ 13,538 Unrecognized tax benefits Balance at January 1, 2014 $ 25,676 Additions for tax positions of current year 51 Expiration of statute of limitation of prior years -- Translation differences (766 ) Balance at December 31, 2014 $ 24,961 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the statutory tax rate to the effective tax rate is as follows: Year ended December 31, 2016 2015 2014 Tax expense (benefit) computed at statutory rates $ 52,650 $ (10,972 ) $ (6,920 ) Effect of different tax rates in different jurisdictions (4,772 ) 6,108 (18,453 ) Gain on acquisition (10,450 ) -- (33,280 ) Tax benefits for which deferred taxes were not recorded (23,489 ) 11,687 27,757 Unrecognized tax expense (benefit) (6,212 ) (11,153 ) 412 Permanent differences and other, net (6,295 ) (7,948 ) 5,742 Income tax expense (benefit) $ 1,432 $ (12,278 ) $ (24,742 ) |
RELATED PARTIES BALANCES AND 50
RELATED PARTIES BALANCES AND TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Balances and Transactions | A. Balances The nature of the relationships involved As of December 31, 2016 2015 Long-term investment Equity investment in a limited partnership $ 37 $ 50 Trade accounts payable Trade accounts payable $ -- $ 52 B. Transactions Description of the transactions Year ended December 31, 2016 2015 2014 Cost of revenues Purchase of services and goods from affiliates of a related party. $ -- $ 13,970 $ 14,883 General and Administrative expenses Directors’ fees and reimbursement to directors $ 639 $ 234 $ 221 Other expense (income), net Equity loss (profit) in a limited partnership $ 13 $ (6 ) $ 16 |
ADDITIONAL INFORMATION - RECO51
ADDITIONAL INFORMATION - RECONCILIATION OF US GAAP TO IFRS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
ADDITIONAL INFORMATION - RECONCILIATION OF US GAAP TO IFRS [Abstract] | |
Schedule of Condensed Balance Sheet in Accordance with IFRS | As of December 31, 2016 US GAAP Adjustments IFRS ASSETS Current assets $ 697,998 $ -- $ 697,998 Property and equipment, net 616,686 -- 616,686 Long term assets 65,200 (7,000 ) 58,200 Total assets $ 1,379,884 $ (7,000 ) $ 1,372,884 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities $ 247,115 $ -- $ 247,115 Long-term liabilities 450,155 (1,323 ) 448,832 Total liabilities 697,270 (1,323 ) 695,947 TOTAL SHAREHOLDERS’ EQUITY 682,614 (5,677 ) 676,937 Total liabilities and shareholders' equity $ 1,379,884 $ (7,000 ) $ 1,372,884 |
Schedule of Condensed Statement of Operations in Accordance with IFRS | Year ended December 31, 2016 US GAAP Adjustments IFRS Profit before income tax and excluding other financing expense, net $ 223,090 $ (193 ) $ 222,897 Other financing expense, net (12,492 ) 143 (12,349 ) Profit before income tax expense 210,598 (50 ) 210,548 Income tax expense (1,432 ) -- (1,432 ) Profit for the period 209,166 (50 ) 209,116 Net income attributable to the non-controlling interest (5,242 ) -- (5,242 ) Net profit attributable to the company $ 203,924 $ (50 ) $ 203,874 |
Schedule of reconciliation of net loss from US GAAP to IFRS | Year ended December 31, 2016 2015 2014 Net profit (loss) in accordance with US GAAP $ 203,924 $ (29,647 ) $ 4,263 Financial instruments 143 73,770 21,556 Pension plans (206 ) (705 ) (1,314 ) Termination benefits 13 (45 ) 409 Net profit in accordance with IFRS $ 203,874 $ 43,373 $ 24,914 |
Schedule of reconciliation of Shareholders' Equity from US GAAP to IFRS | As of December 31, 2016 2015 Shareholders’ equity in accordance with US GAAP $ 682,614 $ 385,586 Financial instruments (237 ) (380 ) Termination benefits 1,560 1,502 Goodwill (7,000 ) (7,000 ) Shareholders’ equity in accordance with IFRS $ 676,937 $ 379,708 |
Schedule of reconciliation of Goodwill from US GAAP to IFRS | As of December 31, 2016 2015 Goodwill in accordance with US GAAP $ 7,000 $ 7,000 Goodwill (7,000 ) (7,000 ) Goodwill in accordance with IFRS $ -- $ -- |
Schedule of reconciliation of Other Assets from US GAAP to IFRS | As of December 31, 2016 2015 Other long term assets in accordance with US GAAP $ 4,447 $ 5,903 Financial instruments -- (450 ) Other long term assets in accordance with IFRS $ 4,447 $ 5,453 |
Schedule of reconciliation of Short Term Bank Debt and Current Maturities of Loans and Debentures from US GAAP to IFRS | As of December 31, 2016 2015 Short-term debt and current $ 48,084 $ 33,259 Financial instruments -- (70 ) Short-term debt and current $ 48,084 $ 33,189 |
Schedule of reconciliation of Long-Term Debentures from US GAAP to IFRS | As of December 31, 2016 2015 Long term debentures in accordance with US GAAP $ 162,981 $ 45,481 Financial instruments 237 -- Long term debentures in accordance with IFRS $ 163,218 $ 45,481 |
Schedule of reconciliation of Other Long Term Liabilities from US GAAP to IFRS | As of December 31, 2016 2015 Long-term employee $ 14,176 $ 14,189 Termination benefits (1,560 ) (1,502 ) Long-term employee $ 12,616 $ 12,687 |
SUMMARY OF SIGNIFICANT ACCOUN52
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | ||
Deferred financing costs | $ 856 | |
Adjustment to retained earnings as result of adoption of FASB issued ASU 2016-09 | $ 1,300 | |
Recognition of excess tax benefit from adoption of FASB issued ASU 2016-09 | $ 1,500 | |
Buildings and building improvements, including facility infrastructure [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated economic life | 10 years | |
Buildings and building improvements, including facility infrastructure [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated economic life | 25 years | |
Machinery and equipment, software and hardware [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated economic life | 15 years | 15 years |
Machinery and equipment, software and hardware [Member] | Previously reported [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated economic life | 7 years | 7 years |
Machinery and equipment, software and hardware [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated economic life | 3 years | |
Machinery and equipment, software and hardware [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated economic life | 15 years |
RECENT ACQUISITIONS (Details)
RECENT ACQUISITIONS (Details) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 12 Months Ended | ||||
Mar. 31, 2014 | Feb. 29, 2016 | Dec. 31, 2016 | Dec. 31, 2014 | Feb. 01, 2016 | Dec. 31, 2015 | ||
Business Acquisition [Line Items] | |||||||
Gain on acquisition | $ 50,471 | $ 166,404 | |||||
TJT acquisition related Receivable, see Note 3B | 5,000 | ||||||
Maxim Fabrication Facility [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Current assets | $ 14,342 | ||||||
Tangible assets | 106,919 | ||||||
Intangible assets | 2,799 | ||||||
Total assets as of acquisition date | 124,060 | ||||||
Customer advance | 2,310 | ||||||
Other current liabilities | 1,257 | ||||||
Deferred tax liability | 28,021 | ||||||
Total liabilities incurred as of acquisition date | 31,588 | ||||||
Consideration payable through Tower's shares issued | 40,000 | ||||||
Gain from acquisition | [1] | $ 52,472 | |||||
Gain on acquisition | $ 2,001 | ||||||
Issuance of ordinary shares | 3,300,000 | ||||||
Gain on business acquisition resulting from earn-out mechanism | $ 6,000 | ||||||
Payment of earn-out mechanism | $ 1,000 | ||||||
TPSCo [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Tower's consideration | $ 7,411 | ||||||
Percentage of interests acquired | 51.00% | ||||||
[1] | Gain from acquisition is presented in the Statement of Operations net of $2,001 acquisition related costs. |
RESTRUCTURING OF JAPAN OPERAT54
RESTRUCTURING OF JAPAN OPERATIONS (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restructuring and Related Activities [Abstract] | |||
Impairment Charges (Credits) | $ (986) | $ (2,641) | $ 47,472 |
Restructuring costs | $ 359 | $ 1,650 | $ 8,028 |
RESTRUCTURING OF JAPAN OPERAT55
RESTRUCTURING OF JAPAN OPERATIONS (Schedule of Restructuring and Asset Impairment Activity) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Restructuring Cost and Reserve [Line Items] | |||
Accrued balance as of beginning of period | $ 5,044 | $ 4,603 | |
Assets impairment related costs and other restructuring charges | 7,316 | ||
Reduction of prior accrual and impairment | (986) | (8,307) | |
Charges against accrual | 359 | 5,841 | |
Cash payments | (2,624) | (4,409) | |
Accrued balance as of end of period | 1,793 | 5,044 | |
Assets impairment and related cost [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Accrued balance as of beginning of period | [1] | 3,100 | 1,196 |
Assets impairment related costs and other restructuring charges | [1] | 3,200 | |
Reduction of prior accrual and impairment | [1] | (986) | (5,841) |
Charges against accrual | [1] | 5,841 | |
Cash payments | [1] | (321) | (1,296) |
Accrued balance as of end of period | [1] | 1,793 | 3,100 |
Other restructuring [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Accrued balance as of beginning of period | 1,944 | 3,407 | |
Assets impairment related costs and other restructuring charges | 4,116 | ||
Reduction of prior accrual and impairment | (2,466) | ||
Charges against accrual | 359 | ||
Cash payments | (2,303) | (3,113) | |
Accrued balance as of end of period | $ 1,944 | ||
[1] | Charges associated with asset impairment represent the write-down of the related assets to their new fair value and are recorded concurrently with the recognition of the accrual. |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 26,296 | $ 27,848 |
Work in process | 105,564 | 73,437 |
Finished goods | 5,672 | 4,396 |
Inventory, net, total | 137,532 | 105,681 |
Aggregate inventory write-downs | $ 1,391 | $ 621 |
OTHER CURRENT ASSETS (Details)
OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Receivables from tax authorities | $ 9,620 | $ 6,913 |
Deferred taxes | 7,158 | 7,036 |
Prepaid expenses | 6,610 | 10,570 |
TJT acquisition related Receivable, see Note 3B | 5,000 | |
Others | 1,653 | 887 |
Other current assets | $ 30,041 | $ 25,406 |
LONG-TERM INVESTMENTS (Details)
LONG-TERM INVESTMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Investments, Debt and Equity Securities [Abstract] | ||
Severance pay funds (see Note 15) | $ 9,909 | $ 10,015 |
Long-term interest bearing bank deposit | 12,500 | |
Others | 3,215 | 1,722 |
Long-term investments, total | $ 25,624 | $ 11,737 |
PROPERTY AND EQUIPMENT, NET (Na
PROPERTY AND EQUIPMENT, NET (Narrative) (Details) $ / shares in Units, ₪ in Thousands, $ in Thousands | 12 Months Ended | 84 Months Ended | ||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)$ / shares | Dec. 31, 2012USD ($) | Dec. 31, 2012ILS (₪) | |
Property, Plant and Equipment [Line Items] | ||||
Reduction in depreciation expenses | $ 42,000 | |||
Increase in profit | 27,000 | |||
Investment grants | $ 36,000 | |||
Aggregate investment grants received | $ 284,406 | $ 284,406 | ||
Decrease in basic loss per share due to extension of estimated useful lives | $ / shares | $ 0.37 | |||
Israel, New Shekels INS [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Investment grants | ₪ | ₪ 135,000 | |||
Machinery and equipment, software and hardware [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives | 15 years | 15 years | ||
Machinery and equipment, software and hardware [Member] | Previously reported [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives | 7 years | 7 years | ||
Facility Infrastructure [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives | 25 years | |||
Facility Infrastructure [Member] | Previously reported [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives | 14 years |
PROPERTY AND EQUIPMENT, NET (Sc
PROPERTY AND EQUIPMENT, NET (Schedule of Property and Equipment) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Original cost: | $ 2,426,900 | $ 2,100,714 |
Accumulated depreciation | (1,810,214) | (1,641,181) |
Property and equipment, net | 616,686 | 459,533 |
Buildings and building improvements, including facility infrastructure [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Original cost: | 333,696 | 292,303 |
Accumulated depreciation | (205,604) | (197,518) |
Machinery and equipment, software and hardware [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Original cost: | 2,093,204 | 1,808,411 |
Accumulated depreciation | $ (1,604,610) | $ (1,443,663) |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 169,263 | $ 166,018 |
Accumulated Amortization | (141,134) | (131,550) |
Net | $ 28,129 | $ 34,468 |
Technologies [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 4 years | 4 years |
Cost | $ 109,543 | $ 106,363 |
Accumulated Amortization | (98,354) | (93,048) |
Net | $ 11,189 | $ 13,315 |
Technologies One [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 5 years | 5 years |
Technologies Two [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 9 years | 9 years |
Facilities lease [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 19 years | 19 years |
Cost | $ 33,500 | $ 33,500 |
Accumulated Amortization | (20,377) | (19,089) |
Net | $ 13,123 | $ 14,411 |
Patents and other core technology right [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 9 years | 9 years |
Cost | $ 15,100 | $ 15,100 |
Accumulated Amortization | (13,903) | (12,225) |
Net | $ 1,197 | $ 2,875 |
Trade name [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 9 years | 9 years |
Cost | $ 7,520 | $ 7,455 |
Accumulated Amortization | (6,064) | (5,000) |
Net | $ 1,456 | $ 2,455 |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life | 15 years | 15 years |
Cost | $ 2,600 | $ 2,600 |
Accumulated Amortization | (1,436) | (1,263) |
Net | 1,164 | 1,337 |
Others [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 1,000 | 1,000 |
Accumulated Amortization | (1,000) | (925) |
Net | $ 75 |
OTHER ASSETS, NET (Details)
OTHER ASSETS, NET (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid long-term land lease, net (see Note 16C) | $ 3,537 | $ 3,658 |
Long term prepaid expenses and others | 910 | 2,245 |
Other assets, net | $ 4,447 | $ 5,903 |
OTHER CURRENT LIABILITIES (Deta
OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Other Liabilities, Current [Abstract] | ||
Interest payable | $ 4,683 | $ 2,138 |
Restructuring related payables | 1,793 | 5,044 |
Tax authorities payables | 10,342 | 7,645 |
Others | 7,265 | 3,153 |
Total other current liabilities | $ 24,083 | $ 17,980 |
LONG-TERM LOANS FROM BANKS (Sch
LONG-TERM LOANS FROM BANKS (Schedule of Long-Term Debt form Banks) (Details) - Tower's loans (including current maturities) [Member] - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Total long-term loans from banks - principal amount | $ 166,376 | $ 245,630 |
Fair value adjustments | (7,900) | |
Deferred issuance costs | (1,344) | (511) |
Total long-term loans from banks | 165,032 | 237,219 |
Current maturities | (31,869) | (26,681) |
Fair value | 133,163 | 210,538 |
U.S. Dollars [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term loans from banks - principal amount | 40,000 | 101,955 |
JPY [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term loans from banks - principal amount | $ 126,376 | $ 143,675 |
LONG-TERM LOANS FROM BANKS (Cre
LONG-TERM LOANS FROM BANKS (Credit Line) (Narrative) (Details) - Jazz [Member] - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Feb. 29, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Line of Credit Facility [Line Items] | |||
Term | 5 years | ||
Maximum borrowing amount | $ 70,000 | ||
Borrowing capacity | 62,000 | ||
Letters of credit outstanding amount | $ 1,000 | ||
Outstanding principal | $ 19,000 | ||
Maturity date | Dec. 31, 2018 | ||
Minimum [Member] | Prime Rate [Member] | |||
Line of Credit Facility [Line Items] | |||
Basis spread over variable interest rate | 0.25% | ||
Minimum [Member] | LIBOR [Member] | |||
Line of Credit Facility [Line Items] | |||
Basis spread over variable interest rate | 1.50% | ||
Maximum [Member] | Prime Rate [Member] | |||
Line of Credit Facility [Line Items] | |||
Basis spread over variable interest rate | 0.75% | ||
Maximum [Member] | LIBOR [Member] | |||
Line of Credit Facility [Line Items] | |||
Basis spread over variable interest rate | 2.00% |
LONG-TERM LOANS FROM BANKS (Loa
LONG-TERM LOANS FROM BANKS (Loans to TPSCo from Japanese Institutions) (Narrative) (Details) ¥ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Jun. 30, 2014 | Dec. 31, 2016USD ($) | Dec. 31, 2015JPY (¥) | |
TPSCo [Member] | Term Loan 2014[Member] | ||||
Debt Instrument [Line Items] | ||||
Amount borrowed | $ 73,000 | $ 53,000 | ||
TPSCo [Member] | Term Loan 2014[Member] | TIBOR [Member] | ||||
Debt Instrument [Line Items] | ||||
Basis spread over variable interest rate | 1.65% | |||
TPSCo [Member] | Term Loan 2014[Member] | Japanese Yen [Member] | ||||
Debt Instrument [Line Items] | ||||
Amount borrowed | ¥ | ¥ 8,800,000 | |||
TPSCo [Member] | Term Loan 2015 [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity term | 5 years | |||
Amount borrowed | $ 71,000 | $ 73,000 | ||
TPSCo [Member] | Term Loan 2015 [Member] | TIBOR [Member] | ||||
Debt Instrument [Line Items] | ||||
Basis spread over variable interest rate | 2.00% | |||
TPSCo [Member] | Term Loan 2015 [Member] | Japanese Yen [Member] | ||||
Debt Instrument [Line Items] | ||||
Amount borrowed | ¥ | ¥ 8,500,000 | |||
JA Mitsui Leasing Capital Corporation [Member] | Loan to TJT [Member] | ||||
Debt Instrument [Line Items] | ||||
Amount borrowed | $ 40,000 | |||
Basis spread over variable interest rate | 2.00% | |||
Number of installment payments | 7 |
DEBENTURES (Schedule of Maturit
DEBENTURES (Schedule of Maturities of Debentures) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Repayment schedule (carrying amount): | ||
Accretion of carrying amount to principal amount | $ (17,043) | $ (13,005) |
Carrying amount | $ 169,196 | $ 52,059 |
Debentures Series D [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 8.00% | 8.00% |
Repayment schedule (carrying amount): | ||
2,016 | $ 5,906 | |
2,017 | $ 5,977 | |
2,018 | ||
2,019 | ||
2,020 | ||
2,021 | ||
2022 and on | ||
Total | $ 5,977 | $ 5,906 |
Debentures Series F [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 7.80% | 7.80% |
Repayment schedule (carrying amount): | ||
2,016 | $ 851 | |
2,017 | $ 238 | |
2,018 | ||
2,019 | ||
2,020 | ||
2,021 | ||
2022 and on | ||
Total | $ 238 | $ 851 |
Debentures Series G [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.79% | |
Repayment schedule (carrying amount): | ||
2,017 | ||
2,018 | ||
2,019 | ||
2,020 | 34,776 | |
2,021 | 34,776 | |
2022 and on | 52,165 | |
Total | $ 121,717 | |
Jazz's Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 8.00% | 8.00% |
Repayment schedule (carrying amount): | ||
2,016 | ||
2,017 | ||
2,018 | 58,307 | 58,307 |
2,019 | ||
2,020 | ||
2,021 | ||
2022 and on | ||
Total | 58,307 | 58,307 |
Total outstanding principal amounts of debentures [Member] | ||
Repayment schedule (carrying amount): | ||
2,016 | 6,757 | |
2,017 | 6,215 | |
2,018 | 58,307 | 58,307 |
2,019 | ||
2,020 | 34,776 | |
2,021 | 34,776 | |
2022 and on | 52,165 | |
Total | $ 186,239 | $ 65,064 |
DEBENTURES (Narrative) (Details
DEBENTURES (Narrative) (Details) $ / shares in Units, ₪ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jun. 30, 2016USD ($) | Dec. 31, 2016USD ($)item | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2016ILS (₪) | Mar. 31, 2014USD ($)$ / shares | Dec. 31, 2012USD ($) | |
Debt Instrument [Line Items] | |||||||
Proceeds from non-convertible debentures | $ 55,960 | $ 70,592 | $ 85,884 | ||||
Debentures Series D [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Outstanding principal | 6,000 | 6,000 | |||||
Repayment by December 2018 | |||||||
Principal amount | $ 27,000 | ||||||
Interest rate | 8.00% | 8.00% | 8.00% | ||||
Debentures Series F [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Outstanding principal | $ 238 | $ 851 | |||||
Repayment by December 2018 | |||||||
Principal amount | $ 231,000 | ||||||
Interest rate | 7.80% | 7.80% | 7.80% | ||||
Number of installment payments | item | 2 | ||||||
Amount of debentures converted into shares | $ 1,000 | $ 196,000 | 34,000 | ||||
Accretion and amortization | 0 | 88,000 | $ 39,000 | ||||
Debentures Series G [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Repayment by December 2018 | |||||||
Proceeds from non-convertible debentures | $ 115,000 | ||||||
Principal amount | $ 122,000 | ||||||
Interest rate | 2.79% | 2.79% | |||||
Number of installment payments | item | 7 | ||||||
Debentures Series G [Member] | Israel, New Shekels INS [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | ₪ | ₪ 468,000 | ||||||
Jazz's Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Outstanding principal | $ 58,000 | 58,000 | |||||
Repayment by December 2018 | $ 58,307 | $ 58,307 | |||||
Principal amount | $ 45,000 | ||||||
Interest rate | 8.00% | 8.00% | 8.00% | ||||
Conversion ratio per share | $ / shares | $ 10.07 | ||||||
Repurchase amount | $ 10,000 | ||||||
Redemption premium (as a percent) | 1.00% |
FINANCIAL INSTRUMENTS AND FAI69
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASURMENTS (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of swap | $ 67 | |
Unrealized gains (losses) | 200 | |
TPSCo [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liability face amount | 36,000 | $ 0 |
Fair value of derivative liabilities | 682 | 0 |
Tower and Jazz Debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of debentures | 245,000 | 97,000 |
Carrying amount | 169,000 | 52,000 |
Fair value liability face amount | 96,000 | 38,000 |
Fair value of derivative liabilities | $ 294 | $ 67 |
FINANCIAL INSTRUMENTS AND FAI70
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASURMENTS (Schedule of Recurring Fair Value Measurements) (Details) - Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Tower's loans (including current maturities) | $ 74,891 | |
Cross currency swap liability position | $ 67 | |
Foreign Exchange forward and cylinders- liability position | 976 | 64 |
Total liabilities | 1,043 | 74,955 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Tower's loans (including current maturities) | ||
Cross currency swap liability position | ||
Foreign Exchange forward and cylinders- liability position | ||
Total liabilities | ||
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Tower's loans (including current maturities) | ||
Cross currency swap liability position | 67 | |
Foreign Exchange forward and cylinders- liability position | 976 | 64 |
Total liabilities | 1,043 | 64 |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Tower's loans (including current maturities) | 74,891 | |
Cross currency swap liability position | ||
Foreign Exchange forward and cylinders- liability position | ||
Total liabilities | $ 74,891 |
FINANCIAL INSTRUMENTS AND FAI71
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Schedule of Liabilities Measured on a Recurring Basis Using Significant Unobservable Inputs) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Unrealized losses recognized in earnings related to outstanding loans held at period end | $ 7,900 | $ 16,092 | $ (1,669) | |
Tower's loans (including current maturities) [Member] | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Beginning balance - at fair value | 74,955 | 77,029 | ||
Loan repayment | (82,855) | (18,200) | ||
Total changes in fair value recognized in earnings | 7,900 | 16,126 | ||
Ending balance - at fair value | 74,955 | 77,029 | ||
Unrealized losses recognized in earnings related to outstanding loans held at period end | [1] | 13,219 | ||
Others [Member] | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Beginning balance - at fair value | 34 | |||
Loan repayment | ||||
Total changes in fair value recognized in earnings | (34) | |||
Ending balance - at fair value | $ 34 | |||
Unrealized losses recognized in earnings related to outstanding loans held at period end | ||||
[1] | Includes only loans under Tower's Facility Agreement with the Israeli Banks. |
EMPLOYEE RELATED LIABILITIES (N
EMPLOYEE RELATED LIABILITIES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Severance pay fund, Israeli employees | $ 9,909 | ||
Long-term employee liabilties, Israeli employees | 11,988 | ||
Israeli employee termination benefits | 4,345 | $ 3,986 | $ 3,801 |
Reduction to plan obiligation, USA employees | $ 3,900 | ||
TPSCo [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Matching contribution (as a percent) | 10.00% | ||
Employee contribution (as a percent) | 1.00% | ||
Cost recognized | $ 7,015 | $ 6,823 | $ 4,011 |
EMPLOYEE RELATED LIABILITIES (S
EMPLOYEE RELATED LIABILITIES (Schedule of Components of Net Periodic Benefit Cost Recognized in Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Postretirement Medical Plan [Member] | |||
Net periodic benefit cost | |||
Service cost | $ 12 | $ 29 | $ 24 |
Interest cost | 85 | 126 | 118 |
Amortization of prior service costs | (12) | (973) | (1,737) |
Amortization of net (gain) or loss | (333) | (115) | (227) |
Total net periodic benefit cost | (248) | (933) | (1,822) |
Other changes in plan assets and benefits obligations recognized in other comprehensive income | |||
Prior service cost for the period | |||
Net (gain) or loss for the period | (316) | (1,333) | 558 |
Amortization of prior service costs | 12 | 973 | 1,737 |
Amortization of net gain or (loss) | 333 | 115 | 227 |
Total recognized in other comprehensive income (expense) | 29 | (245) | 2,522 |
Total recognized in net periodic benefit cost and other comprehensive income (expense) | $ (219) | $ (1,178) | $ 700 |
Weighted average assumptions used: | |||
Discount rate | 4.80% | 4.30% | 5.20% |
Expected return on plan assets, USA employees | |||
Rate of compensation increases | |||
Assumed health care cost trend rates: | |||
Measurement date | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Postretirement Medical Plan [Member] | Pre 65 [Member] | |||
Assumed health care cost trend rates: | |||
Health care cost trend rate assumed for current year | 6.75% | 7.00% | 7.75% |
Ultimate rate | 4.50% | 4.50% | 5.00% |
Year the ultimate rate is reached | 2,025 | 2,025 | 2,022 |
Postretirement Medical Plan [Member] | Post 65 [Member] | |||
Assumed health care cost trend rates: | |||
Health care cost trend rate assumed for current year | 10.00% | 20.00% | 25.00% |
Ultimate rate | 5.00% | 5.00% | 5.00% |
Year the ultimate rate is reached | 2,022 | 2,022 | 2,022 |
Pension Plan [Member] | |||
Net periodic benefit cost | |||
Interest cost | $ 841 | $ 798 | $ 796 |
Expected return on the plan's assets | (1,154) | (1,130) | (1,257) |
Amortization of prior service costs | 3 | 3 | 3 |
Amortization of net (gain) or loss | 34 | 31 | |
Total net periodic benefit cost | (276) | (298) | (458) |
Other changes in plan assets and benefits obligations recognized in other comprehensive income | |||
Prior service cost for the period | |||
Net (gain) or loss for the period | 736 | 6 | 3,117 |
Amortization of prior service costs | (3) | (3) | (3) |
Amortization of net gain or (loss) | (34) | (31) | |
Total recognized in other comprehensive income (expense) | 699 | (28) | 3,114 |
Total recognized in net periodic benefit cost and other comprehensive income (expense) | $ 423 | $ (326) | $ 2,656 |
Weighted average assumptions used: | |||
Discount rate | 4.60% | 4.20% | 5.10% |
Expected return on plan assets, USA employees | 6.20% | 6.20% | 7.50% |
Rate of compensation increases |
EMPLOYEE RELATED LIABILITIES 74
EMPLOYEE RELATED LIABILITIES (Schedule of Impact of One-Percentage Point Change in Assumed Health Care Cost) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Postemployment Benefits [Abstract] | |
Effect on service cost and interest cost, Increase | $ 7 |
Effect on postretirement obligation, Increase | 59 |
Effect on service cost and interest cost, Decrease | (5) |
Effect on postretirement obligation, Decrease | $ (46) |
EMPLOYEE RELATED LIABILITIES 75
EMPLOYEE RELATED LIABILITIES (Schedule of Components of Change in Benefit Obligation, Change in Plan Assets and Funded Status) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Change in benefit obligation: | |||
Change in plan provisions | $ (3,900) | ||
Postretirement Medical Plan [Member] | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of period | 1,781 | $ 2,977 | $ 2,317 |
Service cost | 12 | 29 | 24 |
Interest cost | 85 | 126 | 118 |
Benefits paid | (12) | (18) | (40) |
Change in plan provisions | |||
Actuarial (gain) loss | (316) | (1,333) | 558 |
Benefit obligation end of period | 1,550 | 1,781 | 2,977 |
Change in plan assets | |||
Fair value of plan assets at beginning of period | |||
Employer contributions | 12 | 18 | 40 |
Benefits paid | (12) | (18) | (40) |
Fair value of plan assets at end of period | |||
Funded status | (1,550) | (1,781) | (2,977) |
Pension Plan [Member] | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of period | 18,605 | 19,304 | 15,873 |
Interest cost | 841 | 798 | 796 |
Benefits paid | (496) | (451) | (532) |
Change in plan provisions | |||
Actuarial (gain) loss | 722 | (1,046) | 3,167 |
Benefit obligation end of period | 19,672 | 18,605 | 19,304 |
Change in plan assets | |||
Fair value of plan assets at beginning of period | 18,526 | 18,134 | 16,652 |
Actual return on plan assets | 1,141 | 78 | 1,307 |
Employer contributions | 700 | 765 | 707 |
Benefits paid | (496) | (451) | (532) |
Fair value of plan assets at end of period | 19,871 | 18,526 | 18,134 |
Funded status | 199 | (79) | (1,170) |
Accumulated benefit obligation | $ 19,672 | $ 18,605 | $ 19,304 |
EMPLOYEE RELATED LIABILITIES 76
EMPLOYEE RELATED LIABILITIES (Schedule of Amounts Recognized in Statement of Financial Position) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Postretirement Medical Plan [Member] | |||
Amounts recognized in statement of financial position: | |||
Current liabilities | $ (37) | $ (40) | $ (83) |
Non-current liabilities | (1,513) | (1,741) | (2,894) |
Net amount recognized | $ (1,550) | $ (1,781) | $ (2,977) |
Weighted average assumptions used: | |||
Discount rate | 4.50% | 4.80% | 4.30% |
Rate of compensation increases | |||
Postretirement Medical Plan [Member] | Pre 65 [Member] | |||
Assumed health care cost trend rates: | |||
Health care cost trend rate assumed for next year | 7.20% | 6.75% | 7.00% |
Ultimate rate | 4.50% | 4.50% | 4.50% |
Year the ultimate rate is reached | 2,025 | 2,025 | 2,025 |
Postretirement Medical Plan [Member] | Post 65 [Member] | |||
Assumed health care cost trend rates: | |||
Health care cost trend rate assumed for next year | 10.00% | 10.00% | 20.00% |
Ultimate rate | 4.50% | 5.00% | 5.00% |
Year the ultimate rate is reached | 2,025 | 2,022 | 2,022 |
Pension Plan [Member] | |||
Amounts recognized in statement of financial position: | |||
Non-current assets | $ 199 | ||
Non-current liabilities | (79) | (1,170) | |
Net amount recognized | $ 199 | $ (79) | $ (1,170) |
Weighted average assumptions used: | |||
Discount rate | 4.30% | 4.60% | 4.20% |
Rate of compensation increases |
EMPLOYEE RELATED LIABILITIES 77
EMPLOYEE RELATED LIABILITIES (Schedule of Future Benefit Payments) (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Postretirement Medical Plan [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
2,017 | $ 37 |
2,018 | 48 |
2,019 | 59 |
2,020 | 66 |
2,021 | 67 |
2022 - 2026 | 346 |
Pension Plan [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
2,017 | 706 |
2,018 | 797 |
2,019 | 866 |
2,020 | 943 |
2,021 | 999 |
2022 - 2026 | $ 5,719 |
EMPLOYEE RELATED LIABILITIES 78
EMPLOYEE RELATED LIABILITIES (Schedule of Estimated Amounts in Accumulated Other Comprehensive Income to be Recognized over the Next Fiscal Year) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Postemployment Benefits [Abstract] | |||
Prior service cost | $ 3 | $ 3 | $ 3 |
Net actuarial (gain) or loss | $ 54 | $ 33 | $ 31 |
EMPLOYEE RELATED LIABILITIES 79
EMPLOYEE RELATED LIABILITIES (Schedule of Weighted Average Asset Allocations) (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |
Funded percentage | 100.00% |
Target allocation 2017 | 100.00% |
Equity Securities [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Funded percentage | 62.00% |
Target allocation 2017 | 60.00% |
Debt Securities [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Funded percentage | 38.00% |
Target allocation 2017 | 40.00% |
Real Estate [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Funded percentage | 0.00% |
Target allocation 2017 | 0.00% |
Other [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Funded percentage | 0.00% |
Target allocation 2017 | 0.00% |
EMPLOYEE RELATED LIABILITIES 80
EMPLOYEE RELATED LIABILITIES (Schedule of Assets Measured at Fair Value) (Details) - Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in mutual funds | ||
Total assets measured at fair value | ||
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in mutual funds | 19,871 | 18,526 |
Total assets measured at fair value | 19,871 | 18,526 |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in mutual funds | ||
Total assets measured at fair value |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Jazz [Member] | |||
Operating Leased Assets [Line Items] | |||
Rent expenses | $ 2,800 | $ 3,000 | $ 2,600 |
Future minimum payments of non-cancelable operating building leases | |||
2,017 | 2,800 | ||
2,018 | 2,800 | ||
2,019 | 2,800 | ||
2,020 | 2,400 | ||
2,021 | 2,400 | ||
Thereafter | $ 500 | ||
TPSCo [Member] | |||
Operating Leased Assets [Line Items] | |||
Lease term | 5 years | ||
Future minimum payments of non-cancelable operating building leases | |||
2,017 | $ 13,393 | ||
2,018 | 13,393 | ||
2,019 | $ 3,113 |
SHAREHOLDERS' EQUITY (Ordinary
SHAREHOLDERS' EQUITY (Ordinary Shares) (Narrative) (Details) - ₪ / shares shares in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Stockholders' Equity Note [Abstract] | ||
Ordinary shares, authorized | 150,000 | 150,000 |
Ordinary shares, par value | ₪ 15 | ₪ 15 |
Ordinary shares, issued | 93,071 | 82,144 |
Ordinary shares, outstanding | 92,985 | 82,058 |
Treasury stock, shares | 86 | 86 |
SHAREHOLDERS' EQUITY (Share Opt
SHAREHOLDERS' EQUITY (Share Option Plans) (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options granted | 207,890 | 100,000 | 746,431 | ||
Options granted, exercise price | $ 12.19 | $ 16.92 | $ 5.81 | ||
Options outstanding | 2,278,089 | 5,878,270 | 7,537,219 | 8,066,749 | |
Options outstanding, exercise price | $ 9.92 | $ 6.84 | $ 6.37 | $ 6.31 | |
Shares exercised | 3,649,754 | 1,620,056 | 762,607 | ||
Capital notes | 2,100,000 | ||||
RSU's [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Awards granted | 359,643 | 783,700 | |||
Awards outstanding | 1,009,184 | 773,200 | |||
Old Plans [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options outstanding | 640,000 | 1,640,000 | |||
2013 Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Exercisable period | 7 years | ||||
Options outstanding | 1,630,000 | 4,240,000 | |||
2013 Plan [Member] | RSU's [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Awards outstanding | 1,010,000 | 770,000 | |||
2013 Plan [Member] | CEO, Chairman and directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Awards granted | 570,000 | 570,000 | |||
2013 Plan [Member] | Employees and directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Awards granted | 880,000 | 880,000 | |||
2013 Plan [Member] | Chief Executive Officer [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options granted | 197,890 | ||||
Compensation cost | $ 1,360 | ||||
2013 Plan [Member] | Chief Executive Officer [Member] | RSU's [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Non-option equity awards granted | 15,790 | ||||
2013 Plan [Member] | Chief Executive Officer [Member] | Time Vested Restricted Shares Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Non-option equity awards granted | 31,053 | ||||
2013 Plan [Member] | Chairman of the board of directors [Member] | Time Vested Restricted Shares Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Non-option equity awards granted | 25,168 | ||||
Compensation cost | $ 300 | ||||
2013 Plan [Member] | New external director [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options granted | 10,000 | ||||
2013 Plan [Member] | New other directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost | $ 127 | ||||
2013 Plan [Member] | New other directors [Member] | Time Vested Restricted Shares Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Non-option equity awards granted | 3,334 | ||||
Israeli Banks, Warrants [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares exercised | 700,000 | 700,000 | |||
Israeli Banks, Warrants [Member] | Minimum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options outstanding, exercise price | $ 10.5 | ||||
Israeli Banks, Warrants [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options outstanding, exercise price | $ 92.55 |
SHAREHOLDERS' EQUITY (Other) (N
SHAREHOLDERS' EQUITY (Other) (Narrative) (Details) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2013 | Dec. 31, 2012 |
Warrants 7 [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Shares issuable for warrants | 1,900,000 | |||
Exercise price | $ 7.2 | |||
Series 9 [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Shares issuable for warrants | 5,500,000 | |||
Exercise price | $ 7.33 | |||
Warrants outstanding | 2,300,000 | 4,500,000 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Share Option Activity) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Number of share options | |||
Outstanding as of beginning of year | 5,878,270 | 7,537,219 | 8,066,749 |
Granted | 207,890 | 100,000 | 746,431 |
Exercised | (3,649,754) | (1,620,056) | (762,607) |
Terminated | (97,063) | (26,777) | (30,901) |
Forfeited | (61,254) | (112,116) | (482,453) |
Outstanding as of end of year | 2,278,089 | 5,878,270 | 7,537,219 |
Options exercisable as of end of year | 1,606,983 | 2,606,704 | 1,834,281 |
Weighted average exercise price | |||
Outstanding as of beginning of year | $ 6.84 | $ 6.37 | $ 6.31 |
Granted | 12.19 | 16.92 | 5.81 |
Exercised | 4.82 | 4.94 | 4.36 |
Terminated | 21.34 | 22.28 | 35.40 |
Forfeited | 7.25 | 8.30 | 5.86 |
Outstanding as of end of year | 9.92 | 6.84 | 6.37 |
Options exercisable as of end of year | $ 10.19 | $ 8.93 | $ 11.54 |
SHAREHOLDERS' EQUITY (Schedul86
SHAREHOLDERS' EQUITY (Schedule of Restricted Shares Units Activity) (Details) - RSU's [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Number of RSU's | ||
Outstanding as of beginning of year | 773,200 | |
Granted | 359,643 | 783,700 |
Exercised | (86,847) | |
Forfeited | (36,812) | (10,500) |
Outstanding as of end of year | 1,009,184 | 773,200 |
RSU exercisable as of end of year | ||
Weighted Average Fair Value | ||
Outstanding as of beginning of year | $ 15.11 | |
Granted | 12.83 | 15.11 |
Exercised | 11.45 | |
Forfeited | 14.73 | 15.15 |
Outstanding as of end of year | 14.62 | 15.11 |
RSU's exercisable as of end of year |
SHAREHOLDERS' EQUITY (Schedul87
SHAREHOLDERS' EQUITY (Schedule of Information about Share Options Outstanding) (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | shares | 2,278,089 |
Number exercisable | shares | 1,606,983 |
$4.42- $13.20 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | shares | 1,613,375 |
Outstanding, Weighted-average remaining contractual life | 4 years 3 months |
Outstanding, Weighted average exercise price | $ 6.08 |
Number exercisable | shares | 1,032,269 |
Exercisable, Weighted average exercise price | $ 4.95 |
Exercise price, minimum | 4.42 |
Exercise price, maximum | $ 13.20 |
$15.90 - $19.50 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | shares | 421,878 |
Outstanding, Weighted-average remaining contractual life | 2 years 3 months 18 days |
Outstanding, Weighted average exercise price | $ 17.01 |
Number exercisable | shares | 331,878 |
Exercisable, Weighted average exercise price | $ 17.04 |
Exercise price, minimum | 15.90 |
Exercise price, maximum | $ 19.50 |
$21.00 - $28.20 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | shares | 242,836 |
Outstanding, Weighted-average remaining contractual life | 10 months 17 days |
Outstanding, Weighted average exercise price | $ 23.10 |
Number exercisable | shares | 242,836 |
Exercisable, Weighted average exercise price | $ 23.10 |
Exercise price, minimum | 21 |
Exercise price, maximum | $ 28.20 |
SHAREHOLDERS' EQUITY (Schedul88
SHAREHOLDERS' EQUITY (Schedule of Intrinsic and Fair Values of Options Exercised) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stockholders' Equity Note [Abstract] | |||
The intrinsic value of options exercised | $ 40,314 | $ 15,374 | $ 3,680 |
The original fair value of options exercised | $ 16,711 | $ 3,721 | $ 2,661 |
SHAREHOLDERS' EQUITY (Schedul89
SHAREHOLDERS' EQUITY (Schedule of Intrinsic and Fair Values of RSU's) (Details) (USD $) - RSU's [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
The intrinsic value of RSU's exercised | $ 1,177 | ||
The original fair value of RSU's exercised | $ 994 |
SHAREHOLDERS' EQUITY (Schedul90
SHAREHOLDERS' EQUITY (Schedule of Stock-Based Compensation Expense in Statement of Operations) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
The effect of stock- based compensation on the Statement of Operations is as follow: | |||
Total stock-based compensation expense | $ 9,406 | $ 7,540 | $ 4,684 |
Cost of goods [Member] | |||
The effect of stock- based compensation on the Statement of Operations is as follow: | |||
Total stock-based compensation expense | 3,920 | 2,214 | 753 |
Research and development, net [Member] | |||
The effect of stock- based compensation on the Statement of Operations is as follow: | |||
Total stock-based compensation expense | 2,119 | 1,905 | 1,034 |
Marketing, general and administrative [Member] | |||
The effect of stock- based compensation on the Statement of Operations is as follow: | |||
Total stock-based compensation expense | $ 3,367 | $ 3,421 | $ 2,897 |
SHAREHOLDERS' EQUITY (Schedul91
SHAREHOLDERS' EQUITY (Schedule of Fair Value of Options Granted) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stockholders' Equity Note [Abstract] | |||
Risk-free interest rate, minimum | 0.90% | 1.20% | 1.30% |
Risk-free interest rate, maximum | 1.30% | 1.40% | 1.80% |
Expected life of options | 4 years 7 months 6 days | 4 years 9 months | 4 years 9 months |
Expected annual volatility | 47.00% | ||
Expected annual volatility, minimum | 47.00% | 47.00% | |
Expected annual volatility, maximum | 48.00% | 57.00% | |
Expected dividend yield | |||
Weighted average grant-date fair value | $ 4.20 | $ 7.16 | $ 3.10 |
INFORMATION ON GEOGRAPHIC ARE92
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS (Schedule of Revenues by Geographic Area) (Details) - Geographic Concentration [Member] - Revenue [Member] | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Segment Reporting Information [Line Items] | ||||
Percentage | 100.00% | 100.00% | 100.00% | |
USA [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Percentage | 49.00% | 44.00% | 45.00% | |
Japan [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Percentage | 36.00% | 41.00% | 40.00% | |
Asia [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Percentage | [1] | 12.00% | 11.00% | 11.00% |
Europe [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Percentage | [1] | 3.00% | 4.00% | 4.00% |
[1] | Represents revenues from individual countries of less than 10% each. |
INFORMATION ON GEOGRAPHIC ARE93
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS (Schedule of Long-Lived Assets by Geographic Area) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 616,686 | $ 459,533 |
Israel [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 215,511 | 176,764 |
USA [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 203,501 | 90,748 |
Japan [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 197,674 | $ 192,021 |
INFORMATION ON GEOGRAPHIC ARE94
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS (Schedule of Accounts Receivable of Major Customers) (Details) - Accounts Receivable [Member] | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Customer A [Member] | ||
Concentration Risk [Line Items] | ||
Percentage | 23.00% | 29.00% |
Customer B [Member] | ||
Concentration Risk [Line Items] | ||
Percentage | 15.00% | 17.00% |
INFORMATION ON GEOGRAPHIC ARE95
INFORMATION ON GEOGRAPHIC AREAS AND MAJOR CUSTOMERS (Schedule of Revenues of Major Customers) (Details) - Revenue [Member] | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Customer A [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage | 35.00% | 40.00% | 38.00% | |
Customer B [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage | 12.00% | 13.00% | 9.00% | |
Customer C [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage | [1] | 14.00% | 6.00% | 14.00% |
Customer One [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage | 5.00% | 6.00% | 7.00% | |
Customer Two [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage | 9.00% | 7.00% | ||
[1] | Represents sales to two different customers accounted for 5% and 9% of sales during 2016, to one customer accounted for 6% of sales during 2015 and to two different customers accounted for 7% each during 2014. |
INTEREST EXPENSES, NET AND OT96
INTEREST EXPENSES, NET AND OTHER FINANCING EXPENSES, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Other Income and Expenses [Abstract] | |||
Jazz Notes accretion and amortization | $ 3,571 | $ 3,015 | $ 9,307 |
Jazz 2014 Exchange Agreement related financing costs, see Note 13E | 9,817 | ||
Changes in fair value (total level 3 changes in fair value, see Note 14E) | 7,900 | 16,092 | (1,669) |
Debentures Series G amortization, rate differences and hedging results | 1,901 | ||
Debentures Series F accretion and amortization including accelerated accretion (see Note 13C above) | 150 | 87,973 | 39,494 |
Exchange rate differences | (3,768) | 1,056 | (5,352) |
Others | 2,738 | 1,794 | 3,807 |
Other financing expense, net | 12,492 | 109,930 | 55,404 |
Interest expense, net | $ 11,857 | $ 13,179 | $ 33,409 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Tax Credit Carryforward [Line Items] | |||
Enterprise tax rate | 20.00% | ||
Deferred tax asset | $ 7,158 | $ 7,036 | |
Deferred tax liability | 95,233 | 69,744 | |
Unrecognized tax benefits related to tax return which its statute of limitation may expire in March 2015 | (10,758) | ||
Net operating loss carryforwards | $ 137,900 | ||
Federal statutory rate | 25.00% | ||
Tower [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | $ 1,500,000 | ||
Tower [Member] | State and Local Jurisdiction [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 0 | ||
Jazz [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards, annual utilization amount | $ 0 | ||
Federal statutory rate | 35.00% | ||
Jazz [Member] | Domestic Tax Authority [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 0 | ||
Jazz [Member] | State and Local Jurisdiction [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | $ 0 | ||
TPSCo [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | $ 0 | $ 5,000 | |
TPSCo [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Federal statutory rate | 33.50% | 35.00% | |
TJT [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Federal statutory rate | 35.00% |
INCOME TAXES (Schedule of Incom
INCOME TAXES (Schedule of Income Tax Provision) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Current tax expense (benefit): | ||||
Foreign | [1],[2] | $ 5,948 | $ (8,473) | $ 2,814 |
Total current | 5,948 | (8,473) | 2,814 | |
Deferred tax expense (benefit): | ||||
Foreign | [1] | (4,516) | (3,805) | (27,556) |
Total deferred | (4,516) | (3,805) | (27,556) | |
Income tax expense (benefit) | $ 1,432 | $ (12,278) | $ (24,742) | |
[1] | Foreign are considered provisions for Tower's subsidiaries outside Israel. | |||
[2] | Includes changes in unrecognized tax benefit, see D below. |
INCOME TAXES (Schedule of Profi
INCOME TAXES (Schedule of Profit (Loss) Before Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Profit (loss) before taxes | |||
Domestic | $ 168,668 | $ (59,797) | $ 78,677 |
Foreign | 41,930 | 18,392 | (104,791) |
PROFIT (LOSS) BEFORE INCOME TAX | $ 210,598 | $ (41,405) | $ (26,114) |
INCOME TAXES (Schedule of Defer
INCOME TAXES (Schedule of Deferred Tax Asset/Liability) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Net deferred tax benefit - current: | ||
Net operating loss carryforward | $ 797 | $ 797 |
Employees benefits and compensation | 3,895 | 3,984 |
Others | 5,480 | 5,774 |
Gross deferred tax benefit - current | 10,172 | 10,555 |
Valuation allowance | (3,014) | (3,519) |
Total net current deferred tax benefit | 7,158 | 7,036 |
Deferred tax liability, net - long-term : | ||
Net operating loss carryforward | 306,496 | 327,924 |
Employees benefits and compensation | 2,405 | 2,164 |
Research and development | 1,940 | 1,940 |
Others | 3,403 | 1,814 |
Gross deferred tax assets - long-term | 314,244 | 333,842 |
Valuation allowance, see F below | (279,898) | (304,195) |
Total net long-term deferred tax assets | 34,346 | 29,647 |
Deferred tax liability: | ||
Depreciation and amortization | (96,242) | (51,238) |
Deferred tax related to gain on TPSCo acquisition | (30,653) | (44,423) |
Others | (2,684) | (3,730) |
Total long-term deferred tax liability, net | $ (95,233) | $ (69,744) |
INCOME TAXES (Schedule of Recon
INCOME TAXES (Schedule of Reconciliation of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Beginning balance | $ 13,538 | $ 24,961 | $ 25,676 |
Additions for tax positions of current year | 157 | (623) | 51 |
Expiration of prior years provision due to TJP closure | (6,472) | ||
Additions for tax positions of prior years | 779 | ||
Expiration of statute of limitation of prior years | (10,758) | ||
Decrease from translation differences | (42) | (766) | |
Increase from translation differences | 967 | ||
Ending balance | $ 8,969 | $ 13,538 | $ 24,961 |
INCOME TAXES (Schedule of Effec
INCOME TAXES (Schedule of Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Tax expense (benefit) computed at statutory rates | $ 52,650 | $ (10,972) | $ (6,920) |
Effect of different tax rates in different jurisdictions | (4,772) | 6,108 | (18,453) |
Gain on acquisition | (10,450) | (33,280) | |
Tax benefits for which deferred taxes were not recorded | (23,489) | 11,687 | 27,757 |
Unrecognized tax expense (benefit) | (6,212) | (11,153) | 412 |
Permanent differences and other, net | (6,295) | (7,948) | 5,742 |
Income tax expense (benefit) | $ 1,432 | $ (12,278) | $ (24,742) |
RELATED PARTIES BALANCES AND103
RELATED PARTIES BALANCES AND TRANSACTIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |||
Long-term investment | $ 37 | $ 50 | |
Trade accounts payable | 52 | ||
Cost of revenues | 13,970 | $ 14,883 | |
General and Administrative expenses | 639 | 234 | 221 |
Other expense (income), net | $ 13 | $ (6) | $ 16 |
ADDITIONAL INFORMATION - REC104
ADDITIONAL INFORMATION - RECONCILIATION OF US GAAP TO IFRS (Schedule of Reconciliation of US GAAP TO IFRS) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
ASSETS | ||||
Current assets, US GAAP | $ 697,998 | $ 446,727 | ||
Current assets, Adjustments | ||||
Current assets, IFRS | 697,998 | |||
Property and equipment, net, US GAAP | 616,686 | 459,533 | ||
Property and equipment, net, Adjustments | ||||
Property and equipment, net, IFRS | 616,686 | |||
Long term assets, US GAAP | 65,200 | |||
Long term assets, Adjustments | (7,000) | |||
Long term assets, IFRS | 58,200 | |||
TOTAL ASSETS | 1,379,884 | 965,368 | ||
Total assets, Adjustments | (7,000) | |||
Total assets, IFRS | 1,372,884 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Current liabilities, US GAAP | 247,115 | 211,119 | ||
Current liabilities, Adjustments | ||||
Current liabilities, IFRS | 247,115 | |||
Long-term liabilities, US GAAP | 450,155 | |||
Long-term liabilities, Adjustments | (1,323) | |||
Long-term liabilities, IFRS | 448,832 | |||
TOTAL LIABILITIES | 697,270 | 579,782 | ||
Total liabilities, Adjustments | (1,323) | |||
Total liabilities, IFRS | 695,947 | |||
TOTAL EQUITY | 682,614 | 385,586 | $ 195,561 | $ 141,248 |
TOTAL SHAREHOLDERS' EQUITY, Adjustments | (5,677) | |||
TOTAL SHAREHOLDERS' EQUITY, IFRS | 676,937 | 379,708 | ||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 1,379,884 | 965,368 | ||
Total liabilities and shareholders' equity, Adjustments | (7,000) | |||
Total liabilities and shareholders' equity, IFRS | 1,372,884 | |||
Reconciliation of Condensed Statement of Operations from US GAAP to IFRS | ||||
Profit before income tax and excluding other financing expense, net, US GAAP | 223,090 | |||
Profit before income tax and excluding other financing expense, net, Adjustments | (193) | |||
Profit before income tax and excluding other financing expense, net, IFRS | 222,897 | |||
Other financing expense, net, US GAAP | (12,492) | (109,930) | (55,404) | |
Other financing expense, net, Adjustments | 143 | |||
Other financing expense, net, IFRS | (12,349) | |||
Profit before income tax expense, US GAAP | 210,598 | (41,405) | (26,114) | |
Profit before income tax expense, Adjustments | (50) | |||
Profit before income tax expense, IFRS | 210,548 | |||
Income tax expense, US GAAP | (1,432) | 12,278 | 24,742 | |
Income tax expense, Adjustments | ||||
Income tax expense, IFRS | (1,432) | |||
NET PROFIT (LOSS) | 209,166 | (29,127) | (1,372) | |
Profit for the period, Adjustments | (50) | |||
Profit for the period, IFRS | 209,116 | |||
Net income attributable to the non-controlling interest, US GAAP | (5,242) | (520) | 5,635 | |
Net income attributable to the non-controlling interest, Adjustments | ||||
Net income attributable to the non-controlling interest, IFRS | (5,242) | |||
Net profit attributable to the company | 203,924 | (29,647) | 4,263 | |
Net profit attributable to the company, Adjustments | (50) | |||
Net profit in accordance with IFRS | 203,874 | 43,373 | 24,914 | |
Reconciliation of Net Profit (Loss) from US GAAP to IFRS | ||||
Net profit (loss) in accordance with US GAAP | 203,924 | (29,647) | 4,263 | |
Financial instruments | 143 | 73,770 | 21,556 | |
Pension plans | (206) | (705) | (1,314) | |
Termination benefits | 13 | (45) | 409 | |
Net profit in accordance with IFRS | 203,874 | 43,373 | 24,914 | |
Reconciliation of Shareholders' Equity from US GAAP to IFRS | ||||
Shareholders' equity in accordance with US GAAP | 682,614 | 385,586 | $ 195,561 | $ 141,248 |
Financial instruments | (237) | (380) | ||
Termination benefits | 1,560 | 1,502 | ||
Goodwill | (7,000) | (7,000) | ||
Shareholders' equity in accordance with IFRS | 676,937 | 379,708 | ||
Reconciliation of Goodwill from US GAAP to IFRS | ||||
Goodwill in accordance with US GAAP | 7,000 | 7,000 | ||
Goodwill | (7,000) | (7,000) | ||
Goodwill in accordance with IFRS | ||||
Reconciliation of Other Long-Term Assets from US GAAP to IFRS | ||||
Other long term assets in accordance with US GAAP | 4,447 | 5,903 | ||
Financial instruments | (450) | |||
Other long term assets in accordance with IFRS | 4,447 | 5,453 | ||
Reconciliation of Short-Term Debt and Current Maturities of Loans and Debentures from US GAAP to IFRS | ||||
Short-term debt and current maturities of loans and debentures in accordance with US GAAP | 48,084 | 33,259 | ||
Financial instruments | (70) | |||
Short-term debt and current maturities of loans and debentures in accordance with IFRS | 48,084 | 33,189 | ||
Reconciliation of Long-Term Debentures from US GAAP to IFRS | ||||
Long term debentures in accordance with US GAAP | 162,981 | 45,481 | ||
Financial instruments | 237 | |||
Long term debentures in accordance with IFRS | 163,218 | 45,481 | ||
Reconciliation of Long-Term Employee Related Liabilities from US GAAP to IFRS | ||||
Long-term employee related liabilities in accordance with US GAAP | 14,176 | 14,189 | ||
Termination benefits | (1,560) | (1,502) | ||
Long-term employee related liabilities in accordance with IFRS | $ 12,616 | $ 12,687 |