Richard Shannon: Well thanks for that clarification. Russell, my last question, I’ll jump in the line here. Obviously have a very strong balance sheet here and I think you’re probably going to be free cash flow positive to some degree this year. How do we think about your plan for the cash here as it continues to grow?
Russell Ellwanger : First, I don’t forecast we will be positive for cash flow because, and we did not, and we were not also in Q4, in Q3 because of the big CapEx that we have for grata and also for Intel. Uh, they are exceeding our cash flow operation — not for Intel, for the Albuquerque capacity for the Intel Fab — our capacity, our cap tools, our equipment that will be in the Intel Fab in Albuquerque. So, this $300 million and the remaining of $200 million plus the other CapEx that we have run rate of every year of $200 million this exceeds the cash flow operation. So, it’ll not be positive, but still it’s good that we have the cash on the balance sheet so we can fund it all that. And like I mentioned in my prepared remarks is we still have to pay, we didn’t pay it anything towards the $300 million for Fab 11, for Intel Fab 11 for our tools there.
And we still have $200 million for gut and we have $200 million for maintenance. And in addition to that, like I mentioned, we are planning to invest to increase the capacity of — in our various sites. So, we have flexibility.
Operator: The next question is from Lisa Thompson of ZACKS Investment Research. Please go ahead.
Lisa Thompson : I just have a quick question a little bit about the finances, Oren. So, given your plans for this year, what would be the CapEx expenditure by quarter, and then given that and your nice $1.2 billion in cash, what should we expect for interest income?
Oren Shirazi: Okay. Interest income, you can see in the balance sheet the cash amounts we have. You can assume that we on and on the other hand, we have $200 million loans. The loans are carrying 2%, our investments are currently, I mean, we enjoyed this year also from rates of between 6% to 7% interest on deposits and yields on multiple securities. So, we did really good. For, currently the interest rates are a little bit lower in the world, so instead of getting excellent 6.5% to 7% that we got last year maybe you should assume 5% or 5.5%. And of course, not on the entire cash amounts because some of that is for working capital required all the time. But for majority of our cash, we invested in deposits and up to and about $150 million in multiple security.
So, I would assume 5.5% of that for CapEx. So, I actually said in the beginning we have a $200 million maintenance CapEx, the sustainable level. So, it’s $50 million a quarter, right. On top of that, you should assume, I mean, I said $200 million remaining for Agrate that’s in the coming one and a half yield. So, if you want, you can divide it by six to reach the quarterly CapEx for a Agrate fab. And for the fab 11x, the tools for that fab, I assume, the $300 million will be paid, in the coming two, two and a half years. So, everybody can make his assumptions overall for sure the CapEx should be more than $100 million per quarter, between 100 to 150.
Lisa Thompson: Okay. Great. Thanks. And so just take that off the cash balance. No, because you’re going to generate a little bit in operating income, right?
Oren Shirazi: Yes, but like I answered before too, I believe Richa the cash flow operations is typically lower than $100 million to $150 million a quarter. Right?
Lisa Thompson: Right, right. So definitely negative cash flow, obviously. All right, great. Thank you. That helps a lot. That’s all my, that’s my only question.
Operator: This concludes the question and answer session. Mr. Ellwanger, would you like to make your concluding statement?
Russell Ellwanger: Thank you. Thank you for joining the call. Really is a very exciting time for the company. As stated in the press release itself, it is probably the best position Tower has ever been in, in its history, in all aspects, in our financial strength, in our technology offering, and in our operational capability. And that then all underpinned by the customer partnerships it’s an amazing place to be. Look forward to tracking our progress over the year and reporting on it. In the upcoming short period on February 29th, Dr. Racanelli, our President will host one-on-one meetings at the Susquehanna Technology Conference in New York. On March 19th we’ll be hosting an investor conference in Tel Aviv Stock Exchange at the Tasa building itself.
Overall, appreciate your continued support and confidence. Our team is eagar and ready to seize opportunities ahead, and to drive value for our customers and stakeholders. Thank you and look forward to follow up conversation.
Operator: Thank you. This concludes Tower Semiconductors conference call. Thank you for your participation. You may go ahead and disconnect.
