ORBOTECH LTD.

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA

U.S. dollars in thousands   (except per share data)

 (Unaudited)

3   m o n t h s   e n d e d 

12 months ended

  March 3 1

  December 31

2015

2014

2014

Net income attributable to Orbotech Ltd. on GAAP basis

$11,802

$6,287

$35,380

Minority interest and equity losses 

253

134

301

Tax expenses

1,752

1,350

3,419

Financial expenses

6,471

327

9,046

Depreciation and amortization 

12,660

3,471

30,333

Equity- based compensation expenses

889

816

3,192

SPTS acquisition costs

6,761

ADJUSTED EBITDA

$12,385

$88,432

ORBOTECH LTD.

RECONCILIATION OF GAAP NET INCOME TO CREDIT FACILITY EBITDA

U.S. dollars in thousands   (except per share data)

 (Unaudited)

12 months ended

  March 31

2015

Net income attributable to Orbotech Ltd. on GAAP basis

$40,895

Minority interest and equity losses 

420

Tax expenses

3,821

Financial expenses

15,191

Depreciation and amortization 

39,521

Equity- based compensation expenses

3,265

SPTS acquisition costs

6,761

SPTS full 12 months contribution ⁽¹⁾

5,028

Litigation expenses

1,261

Other ⁽²⁾

CREDIT FACILITY EBITDA ⁽³⁾

$116,163

(1) The SPTS Acquisition was completed on August 7, 2014.  This adjustment gives full year effect to the SPTS Acquisition by reflecting SPTS's contribution to Credit Facility EBITDA for the period from April 1, 2014 to August 7, 2014, determined in accordance with the Credit Agreement.  This adjustment has been derived from SPTS's books and records, is unaudited and does not correspond to SPTS's historical accounting periods. This presentation does not reflect our pro forma results and should not used as indicative of our future results.

(2) Reflects adjustments permitted by the Credit Agreement, including with respect to employee and other matters.

(3) Credit Facility EBITDA does not reflect any annualized expense reductions anticipated as a result of operational changes made as part of the SPTS Acquisition estimated by us in good faith as permitted by the Credit Agreement.  Because we are in the preliminary stages of assessing our operations after the SPTS Acquisition, this adjustment does not include the approximately $10 million of annual cost savings that we believe may be available from our supply chain optimization project.  Although we are carefully assessing the efficiency of our business, we may not identify additional cost savings or achieve the estimated cost savings in the timeframe or amount we anticipate, if at all.  Accordingly, you should not place undue reliance on our ability to achieve cost savings or synergies.