Orbotech Announces Fourth Quarter and Full Year Results for 2012

  Orbotech Announces Fourth Quarter and Full Year Results for 2012

Business Wire

YAVNE, Israel -- February 19, 2013

ORBOTECH LTD. (NASDAQ/GSM SYMBOL: ORBK) today announced its consolidated
financial results for the fourth quarter and year ended December 31, 2012.

Revenues for the fourth quarter of 2012 totaled $100.3 million, compared to
$98.9 million in the third quarter of 2012 and $133.3 million in the fourth
quarter of 2011. GAAP net loss for the fourth quarter of 2012 was $0.7
million, or $0.02 per share, compared to GAAP net loss of $45.7 million, or
$1.05 per share, in the third quarter of 2012 and a GAAP net income of $2.5
million, or $0.06 per share (diluted), in the fourth quarter of 2011. Net loss
for the fourth quarter of 2012 includes a restructuring charge of $3.2 million
relating to certain measures taken to realign the Company’s infrastructure
with current revenue levels and business conditions, including a reduction in
worldwide workforce, consolidation of certain Company facilities and other
cost-cutting measures.

Commenting on the results, Asher Levy, Chief Executive Officer, said: “2012
was an extremely challenging year for the Company, primarily due to lower
capital expenditures by LCD manufacturers and the deferral of capital
expenditures by PCB manufacturers in response to highly uncertain global
economic conditions. During the fourth quarter, we took steps to reduce our
expense structure, which will better position us to benefit from the
improvement we are already beginning to see in the FPD industryand from the
expected growth in the PCB industry. In 2013, these measures should result in
savings of approximately $10 million in operating expenses and will afford us
significant operating leverage. However, they will not impact our service
business nor diminish our ability to continue to develop the best solutions to
meet our customers’ needs.”

Revenues for the year ended December 31, 2012 totaled $400.7 million, compared
to $565.3 million in 2011. GAAP net loss for the year ended December 31, 2012
was $45.6 million, or $1.05 per share, compared to a GAAP net income of $47.3
million, or $1.16 per share (diluted), in 2011.

GAAP net loss for the year reflects: (a) an impairment charge of $30.1
million, or $0.69 per share, relating to intangible assets allocated to the
Company’s flat panel display (“FPD”) business, following the assessment and
testing of the value of those assets in light of the changed FPD industry and
business conditions; (b) a write-down of inventories and a provision for
non-cancelable commitments in the amount of $14.3 million, or $0.33 per share,
relating primarily to components for the Company’s FPD products, which takes
into consideration the Company’s current inventory levels and its assessment
as to anticipated future demand for its FPD products; (c) $4.0 million of net
costs associated with the previously-disclosed charges filed in Korea against
the Korean subsidiary of Orbotech Ltd. and six employees thereof (the “Korean
Matter”); and (d) $5.1 million in restructuring charges related to the
Company’s cost reduction programs.

Non-GAAP net income from continuing operations for the fourth quarter of 2012
was $3.9 million, or $0.09 per share (diluted), compared to non-GAAP net
income from continuing operations of $6.5 million, or $0.15 per share
(diluted), in the fourth quarter of 2011.

Non-GAAP net income from continuing operations for the year ended December 31,
2012 was $2.3 million, or $0.05 per share (diluted), compared to non-GAAP net
income from continuing operations of $62.2 million, or $1.52 per share
(diluted), for the year ended December 31, 2011. A reconciliation of each of
the Company’s non-GAAP measures to the comparable GAAP measure is included at
the end of this press release.

In the Company’s Production Solutions for Electronics Industry segment, sales
of equipment to the printed circuit board (“PCB”) industry were $42.2 million
in the fourth quarter of 2012, compared to $42.0 million in the third quarter
of 2012, and $52.6 million in the fourth quarter of 2011. Sales of equipment
to the FPD industry were $17.6 million in the fourth quarter of 2012, compared
to $15.3 million in the third quarter of 2012, and $42.5 million in the fourth
quarter of last year. In the Company’s Recognition Software segment, sales
were $2.5 million in the fourth quarter of 2012, compared to $2.0 million in
the third quarter of 2012, and $2.1 million in the fourth quarter of 2011. In
addition, service revenue for the fourth quarter of 2012 was $38.0 million,
compared to $39.6 million in the third quarter of 2012, and $36.0 million in
the fourth quarter of 2011.

The Company completed the quarter with cash, cash equivalents, short-term bank
deposits and marketable securities of approximately $278.8 million; and debt
of $64.0 million, compared with cash, cash equivalents and short-term bank
deposits of approximately $276.2 million; and debt of $72.0 million at the end
of the third quarter of 2012. The Company generated cash of $12.7 million from
continuing operations in the fourth quarter of 2012. Additionally, during
February 2013, the Company prepaid $32.0 million of its loan from the Israel
Discount Bank Ltd. and estimates that this will result in a reduction of
approximately $1.8 million in its financial expenses for 2013. The remaining
$32.0 million loan from Israel Discount Bank Ltd. is due by December 21, 2013
and, accordingly has been classified as a current liability.

To date, the Company has repurchased 429,812 of its Ordinary Shares, at a
total cost of approximately $3.74 million, under the share repurchase program
approved and announced in November 2012. Pursuant to approval granted by its
Board of Directors, the Company will continue to repurchase shares, up to the
originally approved total of $30.0 million. Such purchases will be subject,
among other things, to the share price and market conditions and will be made
in accordance with all applicable laws and regulations.

Hearings on the Korean Matter remain ongoing, as does the investigation by the
prosecutor into the actions of employees of the Company outside of Korea, in
connection with which the Company’s Korean subsidiary continues to co-operate
with the Korean authorities. The Company recorded $4.0 million in net costs in
2012 in connection with the Korean Matter, and expects to continue to incur
fees and expenses associated therewith.

Due to the elimination of the proportionate method of consolidation for joint
ventures under applicable Israeli GAAP, which became effective on January 1,
2013, commencing from the first quarter of 2013 the Company will account for
its interest in Frontline P.C.B. Solutions Limited Partnership (“Frontline”)
using the equity method and, as a result, will report its investment as a one
line item within investments and other non-current assets in the consolidated
balance sheets; and its share of earnings on one line in the Company’s
consolidated statement of operations. This presentation will be applied in the
Company’s financial statements for all prior periods for consistency.
Accordingly, the Company’s reported financial statements for prior periods,
including the financial statements in this press release, will change in
future periods. The Company’s share in the earnings of Frontline will be
presented under operating income since Frontline is integrated into the
operations of the Company.

The Company expects that revenues for the first quarter of 2013, which it
anticipates will be the lowest quarter for the year, will be approximately $93
- $94 million, or about $90 million under the new accounting treatment in
connection with Frontline, as discussed above.

An earnings conference call for the Company’s fourth quarter 2012 results is
scheduled for Tuesday, February 19, 2013, at 9:00 a.m. EST. The dial-in number
for the conference call is 517-308-9494, and a replay will be available on
telephone number 402-220-9088 until March 5, 2013. The pass code is Q4. A live
web cast of the conference call and a replay can also be heard by accessing
the investor relations section on the Company’s website at www.orbotech.com.

About Orbotech Ltd.

Orbotech Ltd. (NASDAQ/GSM: ORBK) has been at the cutting edge of the
electronics industry supply chain, as an innovator of enabling technologies
used in the manufacture of the world’s most sophisticated consumer and
industrial products, for over 30 years. The Company is a leading provider of
yield-enhancing and production solutions, primarily for manufacturers of
printed circuit boards, flat panel displays and other electronic components;
and today, virtually every electronic device is produced using Orbotech
technology. The Company also applies its core expertise and resources in other
advanced technology areas, including character recognition for check and forms
processing and solar photovoltaic manufacturing. Headquartered in Israel and
operating from multiple locations internationally, Orbotech’s highly talented
and inter-disciplinary professionals design, manufacture, sell and service the
Company’s end-to-end portfolio of solutions for the benefit of customers the
world over. For more information please see the Company’s filings with the
U.S. Securities and Exchange Commission at www.sec.gov. and visit the
Company’s corporate website at www.orbotech.com. The corporate website is not
incorporated herein by reference and is included as an inactive textual
reference only.

Cautionary Statement Regarding Forward-Looking Statements

Except for historical information, the matters discussed in this press release
are forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. These statements relate to, among
other things, future prospects, developments and business strategies and
involve certain risks and uncertainties. The words “anticipate,” “believe,”
“could,” “will,” “plan,” “expect” and “would” and similar terms and phrases,
including references to assumptions, have been used in this press release to
identify forward-looking statements. These forward-looking statements are made
based on management’s expectations and beliefs concerning future events
affecting Orbotech and are subject to uncertainties and factors relating to
its operations and business environment, all of which are difficult to predict
and many of which are beyond the Company’s control. Many factors could cause
the actual results to differ materially from those projected including,
without limitation, the timing, terms and success of any strategic
transaction, the outcome and impact of the pending criminal matter and ongoing
investigation in Korea, including any impact on existing or future business
opportunities in Korea and elsewhere, any civil actions related to the Korean
Matter brought by third parties, including the Company’s customers, which may
result in monetary judgments or settlements, expenses associated with the
Korean Matter, cyclicality in the industries in which the Company operates,
the Company’s production capacity, timing and occurrence of product
acceptance, fluctuations in product mix, worldwide economic conditions
generally, especially in the industries in which the Company operates, the
timing and strength of product and service offerings by the Company and its
competitors, changes in business or pricing strategies, changes in the
prevailing political and regulatory framework in which the relevant parties
operate or in economic or technological trends or conditions, including
currency fluctuations, inflation and consumer confidence, on a global,
regional or national basis, the level of consumer demand for sophisticated
devices such as smartphones, tablets and other electronic devices and other
risks detailed in the Company’s SEC reports, including the Company’s Annual
Report on Form 20-F for the year ended December 31, 2011; and its reports on
Form 6-K filed with the SEC on May 16, June 11, June 28, August 6, August 7
and November 6, 2012. The Company assumes no obligation to update the
information in this press release to reflect new information, future events or
otherwise, except as required by law.

Non-GAAP Financial Measures

Non-GAAP net income, non-GAAP net income from continuing operations and
non-GAAP net income from continuing operations per share detailed in the
Reconciliation exclude charges, income or losses, as applicable, related to
one or more of the following: (i) equity-based compensation expenses; (ii)
certain items associated with acquisitions, including amortization and
impairment of intangibles; (iii) discontinued operations; (iv) restructuring
charges; and/or (v) share in losses of associated company. Management uses
these non-GAAP measures to evaluate the Company’s operating and financial
performance in light of business objectives and for planning purposes. These
measures are not in accordance with GAAP and may differ from non-GAAP methods
of accounting and reporting used by other companies. Orbotech believes that
these measures enhance investors’ ability to review the Company’s business
from the same perspective as the Company’s management and facilitate
comparisons with results for prior periods. The presentation of this
additional non-GAAP information should not be considered in isolation or as a
substitute for net income; net income attributable to Orbotech Ltd. or
earnings per share prepared in accordance with GAAP, and should be read only
in conjunction with the Company’s consolidated financial statements prepared
in accordance with GAAP. The reasons why management uses these measures, the
usefulness of these measures and the material limitations on the usefulness of
these measures are set forth below. For a detailed explanation of the
adjustments made to comparable GAAP measures, please see the Reconciliation.

To supplement the Company’s financial results presented on a GAAP basis, the
Company uses the non-GAAP measures indicated in the Reconciliation, which
exclude equity based compensation expenses, amortization of intangible assets,
in-process research and development charges, share in losses/profits of
associated companies and impairment and restructuring charges, as well as
certain financial expenses and non-recurring income items that are believed to
be helpful in understanding and comparing past operating and financial
performance with current results. However, the non-GAAP measures presented are
subject to limitations as an analytical tool because they exclude recurring
items (such as equity compensation and amortization of intangible assets) as
described below and because they do not reflect certain cash expenditures that
are required to operate the Company’s business, such as interest expense and
taxes. Accordingly, these non-GAAP financial measures are not meant to be
considered in isolation or as a substitute for comparable GAAP measures and
should be read only in conjunction with the Company’s consolidated financial
statements prepared in accordance with GAAP. Management regularly utilizes
supplemental non-GAAP financial measures internally to understand, manage and
evaluate the Company’s business and make operating decisions. These non-GAAP
measures are among the primary factors management uses in planning for and
forecasting future periods. Non-GAAP financial measures reflect adjustments
based on the following items, as well as the related income tax effects.

The effect of equity-based compensation expenses has been excluded from the
non-GAAP measures. Although equity-based compensation is a key incentive
offered to employees, and the Company believes such compensation contributed
to the revenues earned during the periods presented and also believes it will
contribute to the generation of future period revenues, the Company continues
to evaluate its business performance excluding equity based compensation
expenses. Equity-based compensation expenses will recur in future periods.

The effects of amortization of intangible assets have also been excluded from
the measures. This item is inconsistent in amount and frequency and is
significantly affected by the timing and size of acquisitions. Investors
should note that the use of intangible assets contributed to revenues earned
during the periods presented and will contribute to future period revenues as
well. Amortization of intangible assets will recur in future periods and the
Company may be required to record additional impairment charges in the future.
The Company believes that it is useful for investors to understand the effects
of these items on total operating expenses. For more information about these
items, see the Reconciliation and the Company’s Annual Report on Form 20-F
filed with the SEC for the year ended December 31, 2011.

ORBOTECH LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
AT DECEMBER 31, 2012
                                                             
                                                   December 31     December 31
                                                   2012            2011
                                                   U.S. dollars in thousands
Assets
                                                                   
CURRENT ASSETS:
Cash and cash equivalents                          260,761         151,237
Short-term bank deposits                           3,014           145,292
Marketable securities                              2,238
Accounts receivable:
Trade                                              164,498         196,232
Other                                              29,908          26,163
Deferred income taxes                              7,862           6,580
Inventories                                        93,854          105,109
                                                                  
Total current assets                               562,135        630,613  
                                                                   
INVESTMENTS AND NON-CURRENT ASSETS:
Marketable securities                              12,788
Funds in respect of employee rights upon           11,280          11,846
retirement
Deferred income taxes                              13,634          8,999
Other long-term investments                        1,880          2,426    
                                                   39,582         23,271   
                                                                   
PROPERTY, PLANT AND EQUIPMENT, net                 24,715         26,664   
                                                                   
GOODWILL                                           12,444         12,444   
                                                                   
OTHER INTANGIBLE ASSETS, net                       14,442         54,491   
                                                                  
                                                   653,318        747,483  
                                                                   
                                                                   
Liabilities and equity
                                                                   
CURRENT LIABILITIES:
Current maturities of long-term bank loan          64,000          32,000
Accounts payable and accruals:
Trade                                              27,587          32,357
Other                                              51,895          57,590
Deferred income                                    17,388          25,910
                                                                  
Total current liabilities                          160,870         147,857
                                                                   
LONG-TERM LIABILITIES:
Long-term bank loan                                                64,000
Liability for employee rights upon                 26,221          26,797
retirement
Deferred income taxes                              2,236           1,759
Other tax liabilities                              16,478         16,938   
Total long-term liabilities                        44,935          109,494
                                                                  
Total liabilities                                  205,805        257,351  
                                                                   
EQUITY:
Share capital                                      2,102           2,092
Additional paid-in capital                         274,856         270,966
Retained earnings                                  228,569         274,148
Accumulated other comprehensive income             628            (1,460   )
(loss)
                                                   506,155         545,746
Less treasury shares, at cost                      (59,151  )      (57,192  )
Total Orbotech Ltd. shareholders' equity           447,004         488,554
Non-controlling interest                           509            1,578    
Total equity                                       447,513        490,132  
                                                                  
                                                   653,318        747,483  
                                                                            

ORBOTECH LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEAR AND THREE MONTHS ENDED DECEMBER 31, 2012
                                                          
                                                                    
                        12 months ended               3 months ended
                        December 3 1                  December 3 1
                        2 0 1 2     2 0 1 1         2 0 1 2     2 0 1 1
                                   U.S. dollars in thousands (except per
                                      share data)
                                                                    
REVENUES                400,731         565,313       100,301         133,333
                                                                    
COST OF REVENUES        235,223         329,442       60,977          78,037
                                                                    
WRITE- DOWN OF          14,255          6,743                        6,743
INVENTORIES
                                                                 
GROSS PROFIT            151,253         229,128       39,324          48,553
                                                                    
RESEARCH AND
DEVELOPMENT COSTS       71,815          84,180        17,752          21,598
- net
                                                                    
SELLING, GENERAL
AND                     75,142          72,583        17,982          18,894
ADMINISTRATIVE
EXPENSES
                                                                    
AMORTIZATION OF         9,907           12,304        991             3,091
INTANGIBLE ASSETS
                                                                    
RESTRUCTURING           5,063                         3,145
CHARGES
                                                                    
IMPAIRMENT OF           30,142                        162
INTANGIBLE ASSETS
                                                                 
OPERATING INCOME        (40,816 )       60,061        (708    )       4,970
(LOSS)
                                                                    
FINANCIAL
EXPENSES                5,100           6,551         (146    )       845
(INCOME)- net
                                                                 
INCOME (LOSS)
FROM CONTINUING         (45,916 )       53,510        (562    )       4,125
OPERATIONS BEFORE
TAXES ON INCOME
                                                                    
TAXES ON INCOME         456             7,677         234             1,855
                                                                 
                        (46,372 )       45,833        (796    )       2,270
                                                                    
SHARE IN LOSSES
OF ASSOCIATED           165             179           50              70
COMPANY
                                                                 
NET INCOME (LOSS)
FROM CONTINUING         (46,537 )       45,654        (846    )       2,200
OPERATIONS
                                                                    
INCOME FROM
DISCONTINUED                           1,363
OPERATIONS, NET
OF TAX
                                                                 
NET INCOME (LOSS)       (46,537 )       47,017        (846    )       2,200
                                                                    
NET LOSS
ATTRIBUTABLE TO         (958    )       (322    )     (112    )       (347    )
NON-CONTROLLING
INTERESTS
                                                                 
NET INCOME (LOSS)
ATTRIBUTABLE TO         (45,579 )      47,339       (734    )      2,547   
ORBOTECH LTD.
                                                                    
AMOUNTS
ATTRIBUTABLE TO
ORBOTECH LTD.:
INCOME (LOSS)
FROM CONTINUING         (45,579 )       45,976        (734    )       2,547
OPERATIONS
                                                                    
INCOME FROM
DISCONTINUED                           1,363
OPERATIONS, NET
OF TAX
                                                                 
NET INCOME (LOSS)
ATTRIBUTABLE TO         (45,579 )      47,339       (734    )      2,547   
ORBOTECH LTD.
                                                                    
                                                                    
EARNINGS PER
SHARE:
INCOME (LOSS)
FROM CONTINUING
OPERATIONS:
BASIC                   ($1.05  )     $ 1.15         ($0.02  )     $ 0.06    
                                                                    
DILUTED                 ($1.05  )     $ 1.13         ($0.02  )     $ 0.06    
                                                                    
NET INCOME (LOSS)
ATTRIBUTABLE TO
ORBOTECH LTD.:
BASIC                   ($1.05  )     $ 1.19         ($0.02  )     $ 0.06    
                                                                    
DILUTED                 ($1.05  )     $ 1.16         ($0.02  )     $ 0.06    
                                                                    
                                                                    
WEIGHTED AVERAGE
NUMBER OF SHARES
USED IN
COMPUTATION
OF EARNINGS PER
SHARE - IN
THOUSANDS:
BASIC                   43,501        39,909       43,537        43,261  
                                                                    
DILUTED                 43,501        40,816       43,537        43,966  
                                                                              

ORBOTECH LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR AND THREE MONTHS ENDED DECEMBER 31, 2012
                                                          
                                                                     
                                                                     
                      12 months ended                3 months ended
                      December 31                    December 31
                      2 0 1 2       2 0 1 1          2 0 1 2         2 0 1 1
                                           U.S. dollars in       
                                               thousands
CASH FLOWS FROM
OPERATING
ACTIVITIES:
                                                                     
Net income            (46,537 )     47,017           (846     )      2,200
(loss)
Adjustment to
reconcile net
income to net
cash
provided by
operating
activities:
Income from
discontinued                        (1,363   )
operations
Depreciation
and                   17,964        19,958           3,240           4,885
amortization
Impairment of
Intangible            30,142                        162             
assets
Compensation
relating to
equity awards         3,070         3,728            784             813
granted to
employees
and others
Decrease in
liability for         (576    )     (704     )       (1,296   )      (650    )
employee rights
upon retirement
Deferred income       (5,440  )     2,584            (1,770   )      249
taxes
Non-cash
expenses in           601                            
respect of
restructuring
Loss from sales
and write down                      395
of marketable
securities
Amortization of
premium and
accretion of
discount on           588                            151
marketable
Securities,
net
Other,
including             1,455         1,224            315             155
capital loss
(gain)
Decrease
(increase) in
accounts
receivable:
Trade                 31,734        (42,714  )       14,936          771
Other                 (2,743  )     2,698            (883     )      1,577
Increase
(decrease) in
accounts
payable and
accruals:
Trade                 (4,770  )     5,822            (7,147   )      (7,449  )
Deferred income       (14,484 )     6,105            676             352
and other
Decrease in           11,925       6,870           4,351          14,986  
inventories
Net cash
provided by
operating             22,929        51,620           12,673          17,889
activities -
continuing
operations
Net cash used
in operating
activities -                       (787     )                      (47     )
discontinued
operations
Net cash
provided by           22,929       50,833          12,673         17,842  
operating
activities
                                                                     
CASH FLOWS FROM
INVESTING
ACTIVITIES:
                                                                     
Purchase of
property, plant       (9,611  )     (7,554   )       (3,053   )      (2,366  )
and equipment
Withdraw
(placement) of        142,278       (142,325 )       26,694          (15,025 )
bank deposits
Redemption
(purchase) of         (15,614 )     1,967            (242     )
marketable
securities
Other                               (2,810   )                       (500    )
investment
Proceeds from
disposal of           3,036         35               3,038
property, plant
and equipment
Decrease
(increase) in
funds in
respect of            (254    )     331             (64      )      344     
employee
rights upon
retirement
Net cash
provided by
(used in)
investing             119,835       (150,356 )       26,373          (17,547 )
activities -
continuing
operations
Net cash
provided by
investing                          9,155                          
activities -
discontinued
operations
Net cash
provided by
(used in)             119,835      (141,201 )       26,373         (17,547 )
investing
activities
                                                                     
CASH FLOWS FROM
FINANCING
ACTIVITIES:
                                                                     
Repayment of
long-term bank        (32,000 )     (32,000  )       (8,000   )      (8,000  )
loan
Employee stock
options               719           2,063            57              414
exercised
Issuance of                         90,683
shares, net
Acquisition of        (1,959  )                     (1,959   )      
treasury shares
Net cash
provided by
(used in)             (33,240 )     60,746          (9,902   )      (7,586  )
financing
activities
                                                                     
NET INCREASE
(DECREASE) IN         109,524       (29,622  )       29,144          (7,291  )
CASH AND CASH
EQUIVALENTS
                                                                     
CASH AND CASH
EQUIVALENTS AT        151,237       180,859          231,617         158,528
BEGINNING OF
PERIOD
                                                                  
CASH AND CASH
EQUIVALENTS AT        260,761      151,237         260,761        151,237 
END OF PERIOD
                                                                             

ORBOTECH LTD.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS FROM CONTINUING OPERATIONS
FOR THE YEAR AND THREE MONTHS ENDED DECEMBER 31, 2012
                                                            
                                                                      
                                                                      
                      12 months ended                  3 months ended
                      December 3 1                     December 3 1
                      2 0 1 2         2 0 1 1          2 0 1 2        2 0 1 1
                                   U.S. dollars in thousands (except per
                                      share data)
                                                                      
                                                                      
Reported
operating              (40,816 )       60,061        (708   )      4,970
income (loss)
on GAAP basis
                                                                      
Equity based
compensation            3,070            3,728           784            813
expenses
Restructuring
charges, net of         4,593                            2,675
tax credit
Impairment of
Intangible              30,142                           162
assets
Amortization of
intangible             9,907          12,304        991          3,091
assets
Non-GAAP
operating              6,896          76,093        3,904        8,874
income
                                                                      
Reported net
income (loss)
attributable to        (45,579 )       47,339        (734   )      2,547
Orbotech Ltd.
on GAAP basis
                                                                      
Equity based
compensation            3,070            3,728           784            813
expenses
Amortization of
intangible              9,907            12,304          991            3,091
assets
Income from
discontinued                             (1,363  )
operations
Restructuring
charges, net of         4,593                            2,675
tax credit
Impairment of
Intangible              30,142                           162
assets
Share in losses
of associated           165              179             50             70
company
                                                                   
Non-GAAP net
income from            2,298          62,187        3,928        6,521
continuing
operations
                                                                      
Non-GAAP
earnings per          $ 0.05         $  1.52         $ 0.09        $ 0.15
diluted share
                                                                      
Shares used in
earnings per
diluted share          44,071         40,816        44,107       43,966
calculation-in
thousands

Contact:

Orbotech Ltd.
Adrian Auman, +972-8-942-3560
Corporate Vice President Investor Relations
and Special Projects
or
Orbotech, Inc.
Michelle Harnish, +1-603-289-7937
Marketing Communications Manager