28% Gross Profit Margin in Q2 Tops Previous Guidance Range; At Highest Level in Four Years



SEOUL, South Korea and SAN JOSE, Calif., Aug. 3, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX), a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications, today announced financial results for the second quarter ended June 30, 2017.

Total revenue for the second quarter of 2017 was $166.7 million, about flat as compared to $167.1 million for the second quarter of 2016, and an increase of 3.1% as compared to $161.7 million for the first quarter of 2017. Total revenue in the second quarter of 2017 came in at the higher end of the guidance range of $162-168 million provided in May.

Foundry Services Group revenue was $81.5 million in the second quarter of 2017, up 30.8% from revenue of $62.3 million in the second quarter of 2016, and up 5.2% sequentially from $77.5 million in the first quarter of 2017.

Revenue in the Standard Products Group was $85.1 million in the second quarter of 2017, down 18.7% from the second quarter a year ago, and up 1.1% sequentially from $84.2 million in the first quarter of 2017.

Total gross profit in the second quarter of 2017 was $46.7 million or 28% gross profit margin as compared with gross profit of $36.7 million, or 22% gross profit margin for the second quarter of 2016, and $41.6 million, or 25.7% gross profit margin in the first quarter of 2017. Gross profit margin in the second quarter topped the high end of the guidance range of 25-27% provided in May. Gross margin improved due to slightly higher fab utilization, a favorable product mix, and earlier-than-expected cost benefits from departures of manufacturing employees who participated in our 2017 voluntary headcount reduction plan.

Foundry gross profit margin was 28.7% in the second quarter of 2017 as compared with 22.8% in the second quarter of 2016 and 28.5% in the first quarter of 2017. Standard Products Group gross profit margin was 27.2% in the second quarter of 2017 as compared with 21.4% in the second quarter of 2016 and 23.1% in the first quarter of 2017.

Net loss, on a GAAP basis, for the second quarter of 2017 was $8.1 million or $0.24 per basic share as compared with a net loss in the second quarter of 2016 of $17.8 million or $0.51 per basic share and compared with net income of $43.7 million or $1.30 per basic share and $1.05 per diluted share in the first quarter of 2017. The net loss in the second quarter of 2017 was attributable primarily to a non-cash foreign exchange loss on the Company’s intercompany loans. Upon the finalization of a headcount reduction plan, the Company recorded an additional charge of $2.3 million in the second quarter of 2017.

Adjusted Net Income, a non-GAAP financial measure, for the second quarter of 2017, totaled $7.8 million or $0.23 per basic share and $0.21 per diluted share as compared to an Adjusted Net Loss of $1.9 million or $0.05 per basic share in the second quarter of 2016 and Adjusted Net Income of $0.5 million or $0.01 per basic and diluted share in the first quarter of 2017.

Adjusted EBITDA, a non-GAAP financial measure, in the second quarter was $20.3 million as compared with Adjusted EBITDA of $8.6 million in the second quarter of 2016, and up from $13.1 million in the first quarter of 2017. Adjusted EBITDA in the second quarter of 2017 was at the highest level since the first quarter of 2013.

“Our financial results in the second quarter demonstrate the successful execution of our business strategy and our ongoing commitment to improve profitability,” said YJ Kim, Chief Executive Officer of MagnaChip. “With our diversified and balanced portfolio of higher gross margin power and display standard products and analog foundry services, we have created a solid foundation for future profitable growth.”

Chief Financial Officer Jonathan Kim said, “We successfully concluded a headcount reduction plan in the second quarter to further streamline the company, drive significant cost savings and improve key financial metrics.” The headcount reduction is expected to generate cost savings of approximately $24 million with an expected payback period of less than 1.5 years.

Mr. Kim added, “Our gross profit margin as a percentage of revenue in the second quarter was at the highest level in more than four years and our Adjusted EBITDA of $20.3 million increased 55% from the prior quarter and more than doubled as compared to the same quarter a year ago.”

Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting MagnaChip’s business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of GAAP results to non-GAAP results is included in this press release.

Cash and cash equivalents totaled $131.5 million at the end of the second quarter, a decrease of $1.1 million from $132.6 million at the end of the first quarter of 2017.

The following table sets forth information relating to our operating segments:

Second Quarter and Recent Company Highlights

MagnaChip:
• Hosted its Annual Foundry Technology Symposium in Silicon Valley to showcase the Company’s technology offerings and provide an in-depth understanding of MagnaChip’s manufacturing capabilities, its specialty technology processes, target applications and end-markets.
• Announced it now offers 0.13 micron BCD process technology integrated with high-density embedded Flash. This BCD process offers 40V power LDMOS and delivers 64K Bytes flash memory, making it suitable for programmable PMIC, wireless power chargers and USB-C power-delivery IC products.
• Was selected as a foundry partner by ELAN Microelectronics to manufacture the world’s first fingerprint sensor IC-based smartcard. The smartcard uses biometrics technology that provides secure identification to prevent credit card fraud, a severe and growing problem globally. The sensor-IC based smartcard will be manufactured utilizing MagnaChip’s 0.35 micron Mixed Signal Thick IMD manufacturing process technology.

Business Outlook

For the third quarter of 2017, MagnaChip anticipates:
•Revenue to be in the range of $172 million to $178 million, or up sequentially nearly 5% at the mid-point of the projected range as compared with the second quarter of 2017, and compared to $192.3 million in the third quarter of 2016.
•Gross profit margin to be in the range of 27% to 29%, as compared to 28.0% in the second quarter of 2017, and as compared to 20.4% in the third quarter of 2016.

Conference Call
MagnaChip will hold a conference call on August 3 at 5 p.m. EDT to discuss the second quarter 2017 financial results. The conference call will be webcast live and is also available by dialing toll-free at 1-844-536-5472. International call-in participants can dial at 1-614-999-9318. The conference ID number is 53163731. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.m. EDT start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.

A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 53163731.

About MagnaChip Semiconductor Corporation
MagnaChip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with over 30 years of operating history, owns a portfolio of approximately 3,300 registered and pending patents, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

Safe Harbor for Forward-Looking Statements
Information in this release regarding MagnaChip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include statements about our future operating and financial performance, including third quarter 2017 revenue and gross profit expectations. All forward-looking statements included in this release are based upon information available to MagnaChip as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include general economic conditions, the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new products and technologies, ability to ramp new products into volume production, industry wide shifts in supply and demand for semiconductor products, industry and/or company overcapacity, effective and cost efficient utilization of manufacturing capacity, financial stability in foreign markets and the impact of foreign exchange rates, unanticipated costs and expenses or the inability to identify expenses which can be eliminated, compliance with U.S. and international trade and export laws and regulations by us and our distributors, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 21, 2017 and subsequent registration statements, amendments or other reports that we may file from time to time with the SEC and/or make available on our website. MagnaChip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82-2-6903-3195
chankeun.park@magnachip.com

MagnaChip Selected as Foundry Partner by ELAN Microelectronics For World’s First Fingerprint Sensor IC-Based Smartcard

 

SEOUL, South Korea and SAN JOSE, Calif., July 17, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications, announced today it was selected as a foundry partner by ELAN Microelectronics to manufacture the world’s first fingerprint sensor IC-based smartcard. The smartcard uses biometrics technology that provides secure identification to prevent credit card fraud, a severe and growing problem globally. The sensor-IC based smartcard will be manufactured utilizing MagnaChip’s 0.35 micron Mixed Signal Thick IMD manufacturing process technology.

The requirement for more precise, efficient and low-power ICs has increased dramatically, coinciding with the rise in importance of biometrics technology for a range of applications. Industry analyst Frost & Sullivan forecasts that the biometrics industry will grow at a CAGR of 17.4% from 2014 to 2019 and that fingerprint-based sensor ICs will comprise 66% of the market.

MagnaChip was selected as ELAN’s foundry partner primarily because of the company’s recognized specialized foundry capability, proven and reliable manufacturing processes with robust analog performance. MagnaChip’s current technologies for fingerprint sensor ICs include 0.35 micron, 0.18 micron 1.8V/3.3V and single 3.3V Mixed Signal technology processes. MagnaChip plans to expand its portfolio of manufacturing processes to include more advanced technologies such as its highly competitive 0.18 micron Slim Mixed Signal manufacturing process, which requires fewer mask layers than usual. MagnaChip’s manufacturing processes are well-suited for applications in fast-growing markets that require fingerprint identification, such as in the payment, medical, transportation and automobile industries.

“We hope that the collaboration between MagnaChip and ELAN will continue to produce innovative and high quality products for our customers,” said I. H. Yeh, ELAN’s Chief Executive Officer. “ELAN sees its continued strategic partnership with MagnaChip as a long-term benefit to ELAN and MagnaChip.”

YJ Kim, Chief Executive Officer of MagnaChip, commented, “We are very pleased to announce MagnaChip’s continued partnership with ELAN and the volume ramp of fingerprint sensor IC-based products utilizing our 0.35 micron Mixed Signal Thick IMD based process technology. This process is well-suited for smartcards, which require low power consumption. We will continue to develop high-performance and cost-effective fingerprint sensor IC technology solutions that meet the growing needs of our foundry customers.”

About ELAN Microelectronics
ELAN, a world leading Smart Human Interface Solution provider with a solid patent portfolio, has successfully integrated its capacitive multi-touch solution into Smartphone, Tablet PC, NB/Ultrabook, while Smart-3D Remote has been promoted into Smart TV & AIO PC, amongst other portable electronic devices. With its Smart-Touchscreen IC & Touchpad IC, ELAN is currently in strategic partnership with Intel in touchscreen controller development. ELAN has received many Win 8 & Win 10 Touch Logo Certifications from Microsoft& has been awarded with the “Best Choice of the Year” award twice by COMPUTEX TAIPEI 2009 & 2012. ELAN is also listed as one of the “Best Under a Billion 200 Companies” worldwide by Forbes Global Magazine.

About MagnaChip Semiconductor
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with a 30-year operating history, owns a portfolio of more than 3,400 registered and pending patents, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Entin Consulting
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director of Public Relations
Tel. +82-2-6903-3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., July 13, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX) will hold a conference call Thursday, August 3, 2017 at 5 p.m. EDT to discuss the Company’s second quarter 2017 financial results. Participating in the call will be YJ Kim, MagnaChip’s CEO and Jonathan Kim, Executive Vice President and CFO. The earnings press release will be issued after the market closes that day.

The conference call will be webcast live and also is available by dialing toll-free at 1-844 536 5472. International call-in participants can dial 1-614-999-9318. The conference ID number is 53163731. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.m. EDT start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.

A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 53163731.

About MagnaChip Semiconductor
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Groups provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip owns a portfolio of approximately 3,300 registered and pending patents, and has extensive engineering, design and manufacturing process expertise resulting from its 30-year operating history.

For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1.408.625.1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82.2.6903.3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., June 19, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications, announced today it now offers 0.13 micron BCD process technology integrated with high-density embedded Flash. This BCD process offers 40V power LDMOS and delivers 64K Bytes flash memory, making it suitable for programmable PMIC, wireless power chargers and USB-C power-delivery IC products.

Increasingly, products such as programmable PMICs, wireless power chargers and USB-C power-delivery ICs require embedded non-volatile memory and other functions to be integrated onto a single Power IC. Aside from embedded non-volatile memory, which is used for program code storage, these products require power LDMOS, which is well suited for high-power requirements. The inclusion of embedded FLASH is crucial in order to minimize chip size when high non-volatile memory density is required. For IoT and automotive applications, this BCD process provides 1.5V and 5V CMOS devices with a very low leakage current level that enables low-power consumption. Furthermore, this new BCD process has various option devices for Hall sensors, varactors, inductors, and RF CMOS devices that are useful for highly integrated IC solutions, which yield smaller system size and lower system cost.

MagnaChip’s 30V high voltage with embedded Flash process for touch IC is already in volume production, and the new BCD with embedded Flash 40V process announced today is now being adopted by foundry customers. Embedded Flash IP, designed and verified by MagnaChip, reduces foundry customers’ design time by providing proven intellectual property (IP) with a range of diverse memory densities. MagnaChip also verifies and provides key analog intellectual property, such as ADC (Analog-to-Digital Converter), DAC (Digital-to-Analog Converter), LDO (Low Dropout Regulator), POR (Power On Reset), PLL (Phase Locked Loop), OSC (Oscillator), which reduces design time.

YJ Kim, Chief Executive Officer of MagnaChip, commented, “The combination of analog-based BCD and non-volatile memory is ideal for producing power management solutions and power ICs used in smartphones, IoT devices and for USB-C applications.” Mr. Kim added, “Our goal is to continue to develop specialized process technologies that meet the increasing needs for the application-specific solutions of our foundry customers.”

About MagnaChip Semiconductor
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with a 30-year operating history, owns a portfolio of more than 3,400 registered and pending patents, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Entin Consulting
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director of Public Relations
Tel. +82-2-6903-3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., May 3, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications, today announced financial results for the first quarter ended March 31, 2017.

Total revenue for the first quarter of 2017 was $161.7 million, up 9.2% as compared to $148.1 million for the first quarter of 2016 and a decline of 10.4% compared to $180.5 million for the fourth quarter of 2016. Total revenue in the first quarter came in at the higher end of the guidance range of $157-163 million provided in February.

Foundry Services Group revenue in the first quarter of 2017 was $77.5 million, up 29.3% from revenue of $60 million in the first quarter of 2016, and about flat with $77.8 million in the fourth quarter of 2016.

Revenue in the Standard Products Group was $84.2 million in the first quarter, down 4.3% from the first quarter a year ago, and a sequential decline of 17.9% from $102.5 million in the fourth quarter of 2016.

Total gross profit in the fourth quarter was $41.6 million or 25.7% as compared with gross profit of $34.2 million, or 23.1%, for the first quarter of 2016, and $46.1 million, or 25.5% in the fourth quarter of 2016. Gross profit margin in the first quarter came in near the top of the guidance range of 24-26% provided in February.

Foundry gross profit margin was 28.5% in the first quarter as compared with 23.8% in the first quarter of 2016 and 30.3% in the fourth quarter of 2016. Standard Products Group
gross profit margin was 23.1% in the first quarter as compared with 23.6% in the first quarter of 2016 and 21.8% in the fourth quarter of 2016.

Net income, on a GAAP basis, for the first quarter of 2017 was $43.7 million or $1.30 per basic share and $1.05 per diluted share as compared with a net income in the first quarter of 2016 of $8.1 million or $0.23 per basic and diluted share and compared with net loss of $49.8 million or $1.42 per basic share in the fourth quarter of 2016. The net income in the first quarter of 2017 was attributable primarily to a non-cash foreign exchange gain on the Company’s intercompany loans.

Adjusted Net Income, a non-GAAP financial measure, for the first quarter of 2017, totaled $0.5 million or $0.01 per basic share and per basic and diluted share as compared to an Adjusted Net Loss of $2.8 million or $0.08 per basic share in the first quarter of 2016 and an Adjusted Net Income of $1.6 million or $0.05 per basic share and $0.04 per diluted share in the fourth quarter of 2016.

Adjusted EBITDA in the first quarter was $13.1 million as compared with Adjusted EBITDA of $8.0 million in the first quarter of 2016, and $14.1 million in the fourth quarter of 2016, despite a 10.4% decline in total revenue.

“We continued to make significant operational progress in the first quarter, and clearly demonstrated our ongoing commitment to achieve higher gross margin and overall profitability,” said YJ Kim, Chief Executive Officer of MagnaChip. “With a balanced portfolio of standard products and analog foundry services, we are well positioned to increase revenue and capitalize on the analog technology trends driving growth in our target markets.”

During the first quarter, the Company reduced the workforce by approximately 140 positions as part of a previously announced headcount reduction plan. This plan is expected to cut the workforce by over two times a similar headcount reduction plan in 2016 that affected 169 employees. Once completed, the workforce reduction will have an expected payback period of less than 1.5 years with an estimated annual cost savings between $23-$27 million.

The Company believes it remains on track to complete the planned workforce reduction within its cash cost range of $29-33 million. During the first quarter, the Company recorded early termination charges of $11.1 million and made cash payments totaling approximately $10 million in connection with the headcount reduction. The cash payments were comprised of approximately $4 million related to the early termination charge and the remaining relates to statutory severance. The Company expects to complete or substantially complete the planned workforce reduction by the end of the second quarter and expects to record an additional early termination charge of approximately $1-2 million in the second quarter related to the workforce reduction.

In commenting on the first quarter financial results, Chief Financial Officer Jonathan Kim said, “Gross profit margin as a percentage of revenue was at its highest level in four years, and Adjusted EBITDA increased over 60% from the first quarter a year ago.” Mr. Kim added, “Based on our current view of the business and the projected savings from ongoing cost-cutting actions, we continue to anticipate that our gross profit margin and Adjusted EBITDA will show improvement in 2017.”

Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting MagnaChip’s business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of GAAP results to non-GAAP results is included in this press release.

Cash and cash equivalents totaled $132.6 million at the end of the first quarter, an increase of $49.3 million from $83.4 million at the end of the fourth quarter of 2016. The cash figure in the first quarter reflects the successful outcome of a Senior Exchangeable Notes Offering in January, and also includes approximately $17 million in connection with the sale of a building that housed a 6″ wafer fab that was closed in February 2016. The proceeds of the sale of the building were released from restricted cash in the first quarter of 2017 after the Company completed certain construction work obligations. Cash outlays during the quarter included, issuance fees and a stock buyback in connection with the Exchangeable Notes Offering, payment of deferred salaries, unusual charges and statutory severance payments related to the on-going workforce reduction, debt interest payments and capital expenditures among others.

First Quarter and Recent Company Highlights

MagnaChip:

Priced the upsized offering of 5.00% Exchangeable Senior Notes after the initial purchasers exercised an over-allotment option. The offering totaled $86.25 million aggregate principal amount of notes, taking into account the over-allotment option exercised by the initial purchasers
Announced it now offers a 0.35 micron 700V Ultra High Voltage process technology with process simplification that reduces manufacturing time and cost. This Ultra High Voltage (UHV) process is ideal for manufacturing AC-DC converter ICs and LED driver ICs.
Unveiled a new 0.18 micron RFSOI process with enhanced switching performance to reduce manufacturing cost and time-to-market, while also providing competitive and superior performance for antenna switches used in mobile and Internet of Things (IoT) devices for wireless connectivity
Announced it will host its annual Foundry Technology Symposium in Santa Clara, California, on June 7 to showcase its analog and mixed signal technology offerings and services

Business Outlook

For the second quarter of 2017, MagnaChip anticipates:
Revenue to be in the range of $162 million to $168 million, or up sequentially nearly 4% at the high end of the projected range as compared with Q1, and compared to $167.1 million in the second quarter of 2016.
Gross profit is anticipated to be in the range of 25% to 27%, as compared to 25.7% in the first quarter of 2017, and as compared to 22% in the second quarter of 2016.

Conference Call
MagnaChip will hold a conference call on May 3 at 5 p.m. ET to discuss the first quarter 2017 financial results. The conference call will be webcast live and is also available by dialing toll-free at 1-844-536-5472. International call-in participants can dial at 1-614-999-9318. The conference ID number is 8267197. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 8 a.m. ET start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.
A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 8267197.

About MagnaChip Semiconductor Corporation
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with a 30-year operating history, owns a portfolio of approximately 3,400 registered and pending patents, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

Safe Harbor for Forward-Looking Statements
Information in this release regarding MagnaChip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include statements about our future operating and financial performance, including second quarter 2017 revenue and gross profit expectations. All forward-looking statements included in this release are based upon information available to MagnaChip as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include general economic conditions, the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new products and technologies, ability to ramp new products into volume production, industry wide shifts in supply and demand for semiconductor products, industry and/or company overcapacity, effective and cost efficient utilization of manufacturing capacity, financial stability in foreign markets and the impact of foreign exchange rates, unanticipated costs and expenses or the inability to identify expenses which can be eliminated, compliance with U.S. and international trade and export laws and regulations by us and our distributors, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 21, 2017 and subsequent registration statements, amendments or other reports that we may file from time to time with the SEC and/or make available on our website. MagnaChip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82-2-6903-3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., April 17, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX) will hold a conference call Wednesday, May 3, 2017 at 5 p.m. EDT to discuss the Company’s first quarter 2017 financial results. Participating in the call will be YJ Kim, MagnaChip’s CEO and Jonathan Kim, Executive Vice President and CFO. The earnings press release will be issued after the market closes that day.

The conference call will be webcast live and also is available by dialing toll-free at 1-844-536-5472. International call-in participants can dial toll-free at 1-614-999-9318. The conference ID number is 8267197. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.m. EDT start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.

A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 8267197.

About MagnaChip Semiconductor
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for high-volume consumer, communication, industrial and computing applications. The Company’s Display Solutions, Power Solutions, and Foundry Services Groups provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip owns a portfolio of more than 3,500 registered and pending patents, and has extensive engineering, design and manufacturing process expertise resulting from its 30-year operating history.

For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1.408.625.1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82.2.6903.3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., April 10, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products, announced today that it will host its Annual U.S. Foundry Technology Symposium at Hilton Santa Clara, California, on June 7th, 2017.

The primary purpose of the Foundry Technology Symposium is to showcase MagnaChip’s most up-to-date technology offerings and to provide an in-depth understanding of MagnaChip’s manufacturing capabilities, its specialty technology processes, target applications and end-markets. Furthermore, during the symposium, MagnaChip plans to discuss current and future semiconductor foundry business trends, and also cover presentations in key markets through guest speeches.

While providing an in-depth overview of its specialty processes, MagnaChip will also highlight its technology portfolio and its future roadmap, including technologies such as mixed-signal, which supports applications in the Internet of Things (IoT) and RF switch sector and Bipolar-CMOS-DMOS (BCD) for high-performance analog and power management applications. In addition, MagnaChip will also feature applications regarding Ultra-High Voltage (UHV), such as LED lighting and AC-DC chargers, and cover Non-Volatile Memory (NVM)-related technologies, such as Touch IC, Automotive MCUs and other customer specific applications. Furthermore, MagnaChip will present its technologies used in applications including smartphones, tablet PCs, automotive, industrial, LED lighting and the wearables segments. MagnaChip will also review its customer-friendly design environment and an on-line customer service tool known as “iFoundry.”

“We are very pleased to host MagnaChip’s Annual Foundry Technology Symposium in the US again this year,” said YJ Kim, Chief Executive Officer of MagnaChip. “We plan to offer participants an opportunity to better understand the foundry and the application market dynamics, and to provide insights into MagnaChip’s specialty process technologies.” MagnaChip has approximately 466 proprietary process flows it can utilize and offer to its foundry customers.

More than 100 fabless companies, IDMs (Integrated Device Manufacturers) and other semiconductor companies are expected to attend the event. To sign up for MagnaChip’s Annual Foundry Technology Symposium in Santa Clara and for more details regarding the symposium, please visit www.magnachip.com or ifoundry.magnachip.com.

About MagnaChip Semiconductor
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for high-volume consumer, communication, industrial and computing applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with a 30-year operating history, owns a portfolio of more than 3,400 registered and pending patents, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Entin Consulting
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director of Public Relations
Tel. +82-2-6903-3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., March 13, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products, announced today that it now offers a new 0.18 micron RFSOI process with enhanced switching performance. Compared to the previous 1.5/2.5V process, this new switch-centric process created specifically for 2.5V reduces manufacturing cost and time-to-market while providing competitive and superior performance for antenna switches used in mobile and Internet-of-Things devices for wireless connectivity.

There are several benefits to using the new 0.18 micron 2.5V RFSOI process. The primary benefit is that it is a cost effective process. It offers a 150fs of Ron*Coff using aluminum for metal1 and reduces the number of photo steps by approximately 15% as compared to the industry standard by one poly silicon layer and four metal layers (1P4M). By reducing the number of mask layers, customers will reduce costs and improve their time-to-market with a shorter turnaround time in the fab. Ron*Coff is a figure of merit used to rate the performance of an RF switch.

Another important benefit is that it has robust breakdown at above 4V while also maintaining Ron*Coff at 150fs. Through high BV (Breakdown Voltage), the stack number of switch is reduced, resulting in chip size reduction.

Furthermore, the new 0.18 micron RFSOI process reduces insertion loss by 20% at 2GHz and low harmonics of better than -60dBm at 35dBm power level. This process, which has successfully been demonstrated with an SP8T (Single Pole Eight Throw) switch, builds on a trap-rich, high-resistivity substrate to suppress harmonic distortion. It also provides additional transistors with useful options such as floating body, low leakage, and enables a reduction in area of approximately 18%, from our previous process, for the integration of multiple RF and analog functions onto a smaller die. Available process options also include a 27-volt metal-inductor-metal capacitor, geometry scalable inductor, high resistivity poly resistor, MOS varactor, and up to 4 layers of metal with 4-micron thick top metal for rich power handling.

“The addition of the switch-centric 2.5V process to our RFSOI technology portfolio is another example of MagnaChip’s strong commitment to our foundry customers, who continually desire cost-competitive and high-performing RFSOI processes,” said YJ Kim, Chief Executive Officer of MagnaChip. Mr. Kim also added that “We will continue to offer differentiated processes and expand our RFSOI process offerings to meet the growing and highly specific technology requirements of our global customer-base.”

 

 

About Maganachip Semiconductor

Maganachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. With more than 40 years of operating history, Maganachip owns a portfolio of approximately 1,200 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. Please visit www.Maganachip.com for more information. Information on or accessible from Maganachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

United States (Investor Relations):

So-Yeon Jeong

Head of Investor Relations

Tel. +1-408-712-6151

Investor.relations@maganachip.com

Korea / Asia media:

Chankeun Park

Director of Public Relations

Tel. +82-2-6903-5223

chankeun.park@maganachip.com

SEOUL, South Korea and SAN JOSE, Calif., Feb. 9, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products, today announced financial results for the fourth quarter ended December 31, 2016.

Revenue for the fourth quarter of 2016 was $180.5 million, a decline of 6.2% compared to $192.3 million for the third quarter of 2016, and up 18.4% as compared to $152.4 million for the fourth quarter of 2015. Revenue in the fourth quarter was at the high end of the previous guidance range provided in October 2016, and was consistent with the Company’s pre-announcement of fourth quarter financial results on January 10, 2017.

Revenue for the 2016 full year was $688.0 million, an increase of 8.6% from $633.7 million in 2015. The 2016 figure included $10 million of revenue from a 6″ fab closed in February 2016, whereas 2015 included $74 million in revenue from that same 6″ fab.

Foundry Services Group revenue in the fourth quarter of 2016 was $77.8 million, a sequential increase of 5.3% from $73.9 million, marking the third consecutive quarter of growth. Foundry Services revenue in the fourth quarter increased 18.2% from revenue of $65.8 million in the fourth quarter of 2015.

Revenue in the Standard Products Group was $102.5 million in the fourth quarter, a sequential decline of 13.4% from $118.3 million in the prior quarter, due primarily to seasonal factors in display products. Standard Products Group revenue in the fourth quarter increased 18.6% from $86.5 million in the fourth quarter of 2015.

Total gross profit in the fourth quarter was $46.1 million, or 25.5%, as compared with gross profit of $39.1 million, or 20.4%, for the third quarter of 2016 and $29.9 million or 19.6%, for the fourth quarter of 2015. Gross profit and gross profit margin figures in the fourth quarter were at the highest levels in more than three years. The gross profit margin in the fourth quarter of 2016 exceeded the high-end of the guidance range provided in October 2016 by 150 basis points.

Foundry gross profit margin was 30.3% in the fourth quarter of 2016, as compared with 23.5% in the third quarter of 2016, and 22.7% in the fourth quarter of 2015. Standard Products Group gross profit margin was 21.8% in the fourth quarter of 2016, as compared with 18.3% in the third quarter of 2016 and 17.2% in the fourth quarter of 2015.

Net loss, on a GAAP basis, for the fourth quarter of 2016 was $49.8 million or $1.42 per basic share as compared with net income in the third quarter of 2016 of $29.9 million or $0.86 per basic share and $0.85 per diluted share, and as compared to net income of $22.9 million or $0.66 per basic and diluted share for the fourth quarter of 2015. The net loss in the fourth quarter of 2016 was attributable primarily to a non-cash foreign exchange loss on the Company’s intercompany loans.

Adjusted Net Income, a non-GAAP financial measure, for the fourth quarter of 2016 totaled $1.6 million or $0.05 per basic share and $0.04 per diluted share, compared to Adjusted Net Loss of $1.3 million or $0.04 per basic share in the third quarter of 2016, and compared to Adjusted Net Income of $5.2 million or $0.15 per basic and diluted share in the fourth quarter of 2015.

Adjusted EBITDA in the fourth quarter of 2016 was $14.1 million as compared with $9.9 million in the third quarter of 2016 and a negative $1.2 million in the fourth quarter of 2015.

“The financial results in the fourth quarter of 2016 and the full year continue to reflect the operational progress we’ve made in our business turnaround,” said YJ Kim, Chief Executive Officer of MagnaChip. “Our key priorities in 2017 include a plan to achieve higher gross profit margin, improve overall profitability and invest in initiatives to fuel long-term growth.”

The Company this month launched a new headcount reduction plan that is expected to be two to three times larger than a 2016 program, which resulted last year in a reduction in headcount of 169 employees. The expected payback period is estimated at approximately 1.5 years, with estimated annual cost savings from $20 million to $27 million, depending upon the final size of the workforce reduction. The Company expects to use $30-40 million of the proceeds from the Exchangeable Senior Notes Offering completed earlier this year to pay severance and other benefits to affected employees.

In commenting on the fourth quarter financial results, Chief Financial Officer Jonathan Kim said, “Gross profit margin exceeded our expectation, due primarily to a richer-than-expected product mix and a larger-than expected increase in foundry revenue. Gross margin for the AMOLED product line continued to exceed the corporate average in the fourth quarter despite a seasonal slowdown in revenue.” Mr. Kim added, “We believe our gross profit margin and Adjusted EBITDA will increase sequentially throughout 2017 beginning in the second quarter, based on our current view of the business as well as our assumptions of the cost reductions we expect to achieve from the current headcount reduction program.”

Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting MagnaChip’s business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of GAAP results to non-GAAP results is included in this press release.

Cash and cash equivalents totaled $83.4 million at the end of the fourth quarter of 2016, an increase from $75.4 million at the end of the third quarter of 2016. In the fourth quarter of 2016, MagnaChip received proceeds of $18.2 million in advance, including $1.7 million valued added tax, related to the sale of a building that housed a 6″ wafer fab that was closed in February 2016. The Company is required to perform certain removal construction work that is expected to be completed by the end of March 2017. Accordingly, once the construction obligation is completed, the proceeds will be recorded as cash and cash equivalents on the consolidated balance sheet.

The following table sets forth information relating to our operating segments:

Fourth Quarter and Recent Company Highlights

MagnaChip Selected as “2016 Best Supplier” by LG Display. The award is the highest possible level of recognition presented to a supplier by LG Display for delivering outstanding product quality.
MagnaChip Priced Upsized Offering of 5.00% Exchangeable Senior Notes after the initial purchasers exercised an over-allotment option. The offering totaled $86.25 million aggregate principal amount of notes, taking into account the over-allotment option exercised by the initial purchasers.
MagnaChip Announces Cost Competitive 0.13 micron Slim Flash Process Technology
MagnaChip to Offer 0.13 micron EEPROM-based RF-CMOS technology
MagnaChip Offers 0.35 micron 700V Ultra High Voltage Process Technology

Business Outlook
For the first quarter of 2017, MagnaChip anticipates:

Revenue to be in the range of $157 million to $163 million, a sequential decline of 9.7% to 13%, reflecting both a typical first quarter seasonal decline and the timing of new AMOLED products previously described during our last earnings call in October 2016. The first quarter revenue outlook represents year-on-year growth as compared to total revenue of $148.1 million in the first quarter of 2016.
Gross profit is anticipated to be in the range of 24% to 26%, about flat with Q4 2016, and above the 23.1% gross profit margin in the first quarter of 2016.

Conference Call
MagnaChip will hold a conference call on Feb. 10 at 8 a.m. ET to discuss the fourth quarter 2016 financial results. The conference call will be webcast live and is also available by dialing toll-free at 1-844-536-5472. International call-in participants can dial toll-free at 1-614-999-9318. The conference ID number is 58406105. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 8 a.m. ET start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.

A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 58406105.

About MagnaChip Semiconductor Corporation
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for high-volume consumer, communication, industrial and computing applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with a 30-year operating history, owns a portfolio of more than 3,400 registered and pending patents, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

Safe Harbor for Forward-Looking Statements
Information in this release regarding MagnaChip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include statements about our future operating and financial performance, including fourth quarter 2016 revenue and gross profit expectations. All forward-looking statements included in this release are based upon information available to MagnaChip as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include general economic conditions, the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new products and technologies, ability to ramp new products into volume production, industry wide shifts in supply and demand for semiconductor products, industry and/or company overcapacity, effective and cost efficient utilization of manufacturing capacity, financial stability in foreign markets and the impact of foreign exchange rates, unanticipated costs and expenses or the inability to identify expenses which can be eliminated, compliance with U.S. and international trade and export laws and regulations by us and our distributors, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 22, 2016 and subsequent registration statements, amendments or other reports that we may file from time to time with the SEC and/or make available on our website. MagnaChip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82-2-6903-3195
chankeun.park@magnachip.com

SEOUL, South Korea and SAN JOSE, Calif., Jan. 30, 2017 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX) today announced it will report financial results for the fourth quarter of 2016 on Thursday, February 9, 2017 at 4:15 p.m. ET. The Company will host an investor conference call on Friday, February 10, 2017 at 8 a.m. ET to discuss the Company’s fourth quarter 2016 financial results.

The conference call will be webcast live and is also available by dialing toll-free at 1-844-536-5472. International call-in participants can dial toll-free at 1-614-999-9318. The conference ID number is 58406105. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 8 a.m. ET start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.

A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 58406105.

About MagnaChip Semiconductor
MagnaChip is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for high-volume consumer, communication, industrial and computing applications. The Company’s Display Solutions, Power Solutions, and Foundry Services Groups provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip owns a portfolio of more than 3,500 registered and pending patents, and has extensive engineering, design and manufacturing process expertise resulting from its 30-year operating history.

For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1.408.625.1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82.2.6903.3195
chankeun.park@magnachip.com