分类： 投资者

MX Names Young Soo Woo as Chief Financial Officer

 

SEOUL, South Korea and SAN JOSE, Calif., May 21, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX) today announced that it has appointed Mr. Young Soo Woo as Chief Financial Officer of the Company, effective as of May 25, 2020. Mr. Woo joins MagnaChip from CoreeGroup, where he was the Chief Executive Officer.

Mr. Woo is a seasoned financial executive with more than 15 years of senior leadership experience. Before CoreeGroup, from April 2017 to August 2019, Mr. Woo served as the Group Chief Financial Officer of Chong Kun Dang Holdings Corporation (“CKDH”), a public company and leading Korean pharmaceutical conglomerate, and also served as its Chief Executive Officer from March 2018 to August 2019. Mr. Woo has also served in various management positions at technology and manufacturing companies, including as Head of Strategic Planning Office and Deputy Head of Finance Office of Korea Telecom, one of the largest telecom companies in Korea, and as Chief Strategy Officer and Chief Operating Officer of Hankook Tire. Mr. Woo also worked at Hanaro Telecom, one of the largest broadband Internet access providers in South Korea, as Managing Director, Corporate Strategy. While at Hanaro Telecom, Mr. Woo played a key role in its initial listing on NASDAQ in 2000. Mr. Woo has extensive experience in financial planning and analysis, cost control, strategy, mergers and acquisitions, initial public offerings and risk management. Mr. Woo will report to YJ Kim, MagnaChip’s Chief Executive Officer.

“Young Soo’s demonstrated skills in driving operational excellence and broad experience in strategic planning and financial analysis will be a significant asset for MagnaChip as we continue to execute our plan for sustainable and profitable growth,” said YJ Kim. “I’m very pleased to welcome him to our leadership team as we transition to a streamlined company focused exclusively on products in the Display and Power semiconductor segments.”

“I’m honored and excited to join the MagnaChip team,” said Mr. Woo. “The company has highly differentiated product portfolios and a solid business pipeline, and I look forward to leveraging my operational experience to help enhance profitability and increase shareholder value.”

Mr. Woo earned a B.A. degree in Economics from the Seoul National University and received his M.A. and Ph.D. in Economics from Cornell University.

About MagnaChip Semiconductor
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 more than 40 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, 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:
So-Yeon Jeong
Investor Relations
Tel: +1.408-712-6151

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 Delivers Solid Execution in First Quarter 2020

 

– Revenue from continuing operations was $120.5 million, up 12.3% year over year (YoY)
– OLED revenue of $69.7 million a record for Q1, up 43.6% YoY
– Revenue from discontinued operations was $76.5 million, up 52.7% YoY
– Foundry Services Group categorized as “discontinued operations” pending sale of the Foundry business and Fab 4
– Combined non-GAAP revenue of $197.0 million from continuing and discontinued operations, highest level achieved for a first quarter in 12 years; hits high-end of updated guidance
– Cash of $157.3 million highest in 7 Years; 4th straight quarter of positive net operating cash flow

 

SEOUL, South Korea and SAN JOSE, Calif., May 6, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (NYSE: MX) (“MagnaChip” or the “Company”) today announced financial results for the first quarter of 2020.

In accordance with U.S. GAAP, the Company’s Foundry Services Group has been accounted for as a discontinued operation beginning in the first quarter of 2020, thereby impacting comparability to previously issued financial guidance. In March 2020, the Company announced the execution of a definitive agreement to sell the Foundry business and Fab 4. As previously reported, the transaction value is approximately $435 million, which includes $344.7 million in cash and approximately $90 million in accrued severance liabilities that will be transferred along with approximately 1,500 employees to the buyer at the close of the sale, expected in four to five months.

The Company now has one reporting segment for continuing operations, which consists of the results of operations of the standard products business, together with transitional foundry services related to Fab 3 that it expects to perform for the buyer of the Foundry business and Fab 4 for a period of up to three years (“Transitional Fab 3 Foundry Services”). The Transitional Fab 3 Foundry Services revenue will be accounted for at cost prior to the closing of the sale of the Foundry business and Fab 4. Additionally, the Foundry business and Fab 4 will be operated in the ordinary course of day-to-day business, but the related operational results will be shown as discontinued operations for accounting purposes until the closing of the sale.

First Quarter 2020: Results of Continuing Operations

Revenue from continuing operations (standard products business and Transitional Fab 3 Foundry Services) was $120.5 million, up 12.3% YoY.

Gross profit from continuing operations (standard products business and Transitional Fab 3 Foundry Services) was $29.1 million or 24.2% as a percentage of revenue from continuing operations, as compared to $19.0 million or 17.7% in the first quarter of 2019.

The Company is providing the following results of continuing operations, which excludes the impact of Transitional Fab 3 Foundry Services, in order to show the comparable results of the standard products business. This segment will constitute the Company’s core operations going forward.

Revenue from the standard products business, comprised of Display Solutions and Power Solutions business lines, was $110.7 million, up 10.4% YoY, and revenue from the Foundry Services Group was $86.3 million, up 51.1% from the same quarter a year ago.

The combined non-GAAP revenue of continuing and discontinued operations was $197.0 million, up 25.2% as compared with $157.4 million in the first quarter of 2019, and at the high-end of guidance range.

Gross profit from the standard products business was $29.1 million or 26.3% as a percentage of revenue from the standard products business, as compared with $19.0 million or 19.0% in the first quarter of 2019.

The combined non-GAAP gross profit margin of continuing and discontinued operations was 25.3%, up nearly 11 percentage points YoY and slightly exceeding the high end of guidance of 23-25%.

Management believes that segregating the revenue of the Transitional Fab 3 Foundry Services, which is more closely associated with the Foundry Services Group discontinued operations and not expected to be long-term core operations for the Company, from the revenue of continuing operations allows investors to better understand the results of continuing operations of our core standard products display solutions and power solutions businesses.

Due to the fact that these Transitional Fab 3 Foundry Services are being shown for accounting purposes at cost, management also believes that showing gross profit margin as a percentage of the standard products business provides investors with a clearer picture of the Company’s core operations for its standard products business.

We are providing certain non-GAAP combined results of continuing and discontinued operations to aid in the comparison to the updated financial guidance range provided on March 10, 2020. For a reconciliation of the Non-GAAP combined results of operations, please see the tables attached to this release.

CEO YJ Kim comments on Q1
Our business performed very well in the first quarter despite the COVID-19 pandemic that disrupted the global economy, as well as typical seasonal softness. OLED revenue of $69.7 million set a record for a first quarter, as eight OLED smartphones launched using our OLED display drivers. The Power business was impacted in part by COVID-19-related market softness and supply chain issues in China that have since improved, and we now expect Power revenue to show sequential revenue improvement in the second quarter. Gross profit margin from our standard products business, which is now our continuing business, was 26.3% in the first quarter and gross profit margin from the Foundry Services Group was 24.0%. Cash and cash equivalents of $157.3 million at the end of Q1 was at the highest level in seven years. We generated positive net operating cash flow of $21.1 million and free cash flow of $17.7 million. Notably, Q1 was the fourth consecutive quarter of positive net operating cash flow.

On COVID-19, mitigating risks to employees and supply chain
Our thoughts and prayers go out to everyone impacted by the COVID-19 pandemic, and we salute the brave first responders and essential health workers here in Korea and around the world. Due to the extraordinary nature of the global COVID-19 pandemic, we have taken several steps to mitigate potential risks related to the health and safety of our employees and to the resiliency of our supply chain. We disinfect areas in our fabs where employees gather, built partitions to separate employees in a cafeteria, upgraded the air filtration systems in our Seoul office, and require all employees to wear protective face masks and practice social distancing. Our supply chain currently is operating at normal levels, and steps have been taken to mitigate risks of disruption. Some of our Display subcontractors in Korea now carry extra inventory, while some Power assembly and test subcontractors in China now are capable of assembling multiple package types to help avoid a potential shortage at any individual plant.

Q2 2020 financial guidance
The COVID-19 pandemic is a rapidly evolving situation that reduces our forward visibility. While Korea and China appear to have made significant strides in controlling the spread of the COVID-19 outbreak, global markets are experiencing a sharp slowdown in business activity due to the global pandemic. To help account for market uncertainties, we have widened the typical guidance range we normally would provide for Q2. While actual results may vary based upon COVID-19 events that are still unfolding, MagnaChip currently anticipates based on best available current estimates for Q2 2020:
Revenue from the standard products business to be flattish to down from the first quarter of 2020. Revenue from the Foundry Services Group to be flattish to up. Non-GAAP combined revenue to be in the range of $191.0 million to $203.0 million, flattish at the mid-point of the projected range when compared with combined revenue of $197.0 million in the first quarter of 2020.
Gross profit margin from both the standard products business and the Foundry Services Group to be up. Non-GAAP combined gross profit margin to be in the range of 26.0% to 28.0%, when compared to 25.3% in the first quarter of 2020.

First Quarter Financial Review
Revenue

Revenue from continuing operations was $120.5 million in the first quarter of 2020, up 12.3% as compared with $107.3 million in the first quarter of 2019.

Revenue from the standard products business was $110.7 million in the first quarter of 2020, up 10.4% as compared with $100.3 million in the first quarter of 2019.

Revenue from the Foundry Services Group was $86.3 million in the first quarter of 2020, up 51.1% as compared with $57.1 million in the first quarter of 2019.

Gross Profit and Gross Profit Margin

Gross profit from continuing operations was $29.1 million or 24.2% as a percentage of revenue from continuing operations, as compared with $19.0 million or 17.7% in the first quarter of 2019.

Gross profit from the standard products business was $29.1 million or 26.3% as a percentage of revenue from the standard products business, as compared with $19.0 million or 19.0% in the first quarter of 2019. The YoY improvement in gross profit margin was due primarily to an improved product mix and a decrease in inventory reserve related to a legacy display product.

Gross profit from the Foundry Services Group was $20.7 million or 24.0% as a percentage of revenue from revenue from the Foundry Services Group, as compared with $3.7 million or 6.4% in the first quarter of 2019. The YoY improvement in gross profit and gross profit margin was primarily due to a higher utilization rate stemmed from a recovery from a global customer inventory correction and an improved product mix.

Operating Income, Net Income, Adjusted Net Income, Adjusted EBITDA

Operating income from continuing operations for the first quarter was $6.0 million as compared to operating loss from continuing operations of $5.1 million in the first quarter of 2019.

Net loss from continuing operations, on a GAAP basis, was $31.1 million or $0.89 per basic and diluted share in the first quarter of 2020 as compared with net loss from continuing operations of $21.6 million or $0.63 per basic and diluted share in the first quarter of 2019.

Adjusted net income from continuing operations, a non-GAAP financial measure, totaled $1.1 million or $0.03 per basic share and diluted share in the first quarter of 2020 as compared to adjusted net loss from continuing operations of $9.7 million or $0.28 per basic and diluted share in the first quarter of 2019.

Adjusted EBITDA from continuing operations, a non-GAAP financial measure, was $9.9 million or 8.9% of revenue from the standard products business in the first quarter of 2020, as compared to negative $1.3 million in the first quarter of 2019.

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, as well as providing a meaningful comparison to previous information provided on a basis prior to the discontinued operations classification of the Foundry Services Group. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income from continuing operations 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 $157.3 million in the first quarter, up from $151.7 million in the fourth quarter of 2019.

Note: The following table sets forth supplemental information relating to the continuing and discontinued operations (in thousands). Upon the execution of the definitive agreement to sell the Foundry business and Fab 4, the Foundry Services Group is accounted for as a discontinued operation.

First Quarter 2020 and Recent Company Highlights
MagnaChip:
Entered into a definitive agreement (the “Agreement”) by certain of its wholly owned subsidiaries to sell the Company’s Foundry Services Group and the factory in Cheongju, the larger of the Company’s two 8″ manufacturing facilities, to a special purpose company in South Korea established by Alchemist Capital Partners Korea Co., Ltd. and Credian Partners, Inc. Under the terms of the Agreement, the total transaction value is approximately $435 million.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-semiconductor-announces-definitive-agreement-sell
Announced its offering of a 0.13 micron BCD process with improved performance to help automotive power semiconductor designers build more competitive products. BCD (Bipolar-CMOS-DMOS) is a process technology that combines three different process technologies onto a single chip: Bipolar for analog signal control and CMOS (Complementary Metal Oxide Semiconductor) and DMOS (Double Diffused Metal Oxide Semiconductor) for digital signal control and high-power handling, used primarily for power semiconductors.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-offers-013-micron-bcd-process-enhanced-performance
Launched a new MOSFET for wireless earphones for preventing the battery from overcharging and entered to the wireless earphone market. This MOSFET is designed to control excessive current flowing into wireless earphones while recharging the battery in order to protect wireless earphones from being damaged. Since 2010, MagnaChip has been providing the world’s highest volume of MOSFETs for smartphone battery charging protection.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-launches-new-mosfet-enhance-protection-wireless

First Quarter 2020 Earnings Conference Call
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 4448257. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.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 4448257.

About MagnaChip Semiconductor
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 the standard products business and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with more than 40 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, 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 MagnaChip’s future operating and financial performance, outlook and business plans, including second quarter 2020 revenue and gross profit margin expectations, and the impact of the COVID-19 pandemic on MagnaChip’s second quarter 2020 and future operating results. 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 the impact of changes in macroeconomic and/or general economic conditions, including those caused by or related to the COVID-19 outbreak, recessions, economic instability and the outbreak of disease; 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; the risk that the pending sale of our Foundry Services Group business and the Fab 4 facility to Magnus Semiconductor, LLC or one of its wholly owned subsidiaries is not consummated according to our current expectations or at all; public health issues, including the COVID-19 pandemic; other business interruptions that could disrupt supply or delivery of, or demand for, MagnaChip’s products, including uncertainties regarding the impacts of the COVID-19 pandemic that may result in factory closures, reduced workforces, scarcity of raw materials and goods produced in infected areas, as well as reduced consumer and business spending affecting demand for MagnaChip’s products due to government and private sector mandatory business closures, travel restrictions or the like to prevent the spread of disease; and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 21, 2020 (including that the impact of the COVID-19 pandemic may also exacerbate the risks discussed therein) and subsequent registration statements, amendments or other reports that we may file from time to time with the Securities and Exchange Commission 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

So-Yeon Jeong
Investor Relations
Tel+1-408-712-6151
Soyeon.jeong@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82-2-6903-5223
chankeun.park@magnachip.com

MagnaChip Schedules First Quarter 2020 Earnings Release and Conference Call for May 6

 

SEOUL, South Korea and SAN JOSE, Calif., April 15, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX) announced today it will host a conference call on Wednesday, May 6, 2020 at 5 p.m. ET to discuss the Company’s financial results for the first quarter of 2020. Participating in the call will be YJ Kim, MagnaChip’s CEO and Shinyoung Park, Chief Accounting Officer. 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 4448257. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.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 4448257.

About MagnaChip Semiconductor
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 more than 40 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, 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
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

– Transaction Value Approximately $435 Million, Including $345 Million in Cash –

– Streamlines MagnaChip into a Pure-play Standard Products Company –

– Positions the Company to Focus on High Growth Markets in Analog Power and Display Solutions Including OLED and MicroLED –

– Strengthens MagnaChip’s Balance Sheet Significantly as Company Intends to Use the Proceeds to Reduce Debt –

 

MagnaChip Semiconductor Updates Financial Guidance For First Quarter of 2020; Anticipates Higher Revenue

— Increases Q1 Revenue Guidance Range to $187 Million to $197 Million from Previous Guidance Range of $180 Million to $195 Million Provided on February 19, 2020

— Strategic Evaluation Process of Foundry Business and Fab 4 Ongoing

SEOUL, South Korea and SAN JOSE, Calif., March 10, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX) today updated its financial guidance for the first quarter ending March 31, 2020. The Company raised its anticipated revenue guidance range to $187 million to $197 million as compared to the previous guidance of $180 million to $195 million. The previous guidance range for the first quarter was previously provided on February 19, 2020 when the Company reported financial results for the fourth quarter of 2019. The Company is providing this business update due to the extraordinary business circumstances caused globally by the COVID-19 coronavirus health crisis and investor uncertainty about the potential impact of the coronavirus on the Company’s business operations since its last market update.

CEO YJ Kim Comments on Q1 2020 Guidance
“Due to stronger-than-expected demand, we now anticipate that revenue in the first quarter to be in the range of $187 million to $197 million as compared to the previous revenue guidance range of $180 million to $195 million that we provided on February 19, 2020. Our updated guidance range is based upon the best available current estimates and excludes any new and unanticipated potential negative impact from the effects of the coronavirus. We anticipate gross profit margin to be in the range of 23% to 25%.”

As stated previously, the strategic evaluation process of the Foundry business and Fab 4 continues to make progress, including having discussions with multiple interested parties toward a possible sale of the Company’s Foundry business and Fab 4, as well as consideration of accretive business conversions and other options related to that business.

MagnaChip undertakes no obligation to update information in this press release based on changes occurring after the date of this release, and the Company does not intend to routinely provide such updates in the future and no inference or expectation of such should be taken from this release. The potential impact of the COVID-19 coronavirus on second quarter and future fiscal 2020 results cannot be reasonably estimated at this time given the uncertainty regarding the magnitude, duration, and global reach of the situation. The Company expects to provide further updates on its first quarter earnings call.

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 more than 40 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, 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, outlook and business plans, including but not limited to first quarter 2020 revenue and gross profit margin expectations, and the impact of the COVID-19 coronavirus on its first quarter 2020 and future operating results. 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, including those caused by or related to the COVID-19 coronavirus outbreak, 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, the risk that the strategic evaluation and the initiatives related thereto are not successful, public health issues, including the outbreak of COVID-19 coronavirus, and other business interruptions that could disrupt supply or delivery of, or demand for, MagnaChip’s products, including without limitation uncertainties regarding the impacts of the outbreak of the COVID-19 coronavirus that may result in factory closures, reduced workforces, scarcity of raw materials and goods produced in infected areas, as well as reduced consumer spending affecting demand for MagnaChip’s products, including as a result of consumers become ill or limiting or ceasing shopping in order to avoid exposure, or governments or employers imposing mandatory business closures, travel restrictions or the like to prevent the spread of disease, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 21, 2020 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. +82-2-6903-5223
chankeun.park@magnachip.com

Magnachip Semiconductor Announces CFO Transition

– Shinyoung Park Appointed as Chief Accounting Officer
– Company Commences Executive Search for New CFO
– Strategic Evaluation Process for Foundry Business and Fab 4 Remains Ongoing

SEOUL, South Korea and SAN JOSE, Calif., March 1, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX) today announced that Jonathan Kim, MagnaChip’s Chief Financial Officer, Executive Vice President and Chief Accounting Officer, is stepping down effective March 27, 2020 to pursue an executive opportunity outside of the semiconductor industry. Mr. Kim is expected to continue to serve in a consulting role for the Company through May 2020 to assist in the transition. The Company has initiated a search process to identify a permanent Chief Financial Officer and has retained an executive search firm to assist with the process.

The Company also announced that Shinyoung Park has been promoted to Chief Accounting Officer, effective immediately. Ms. Park has been with MagnaChip since 2014, most recently serving as Corporate Controller and as a member of the executive team. Prior to joining the Company, Ms. Park held various senior advisory and audit service positions for 10 years with Deloitte in three different locations—Chicago, Illinois, Seoul, South Korea and London, U.K.

MagnaChip’s Chief Executive Officer, YJ Kim, said: “On behalf of the Board of Directors and the entire management team, I thank Jonathan for his numerous contributions to MagnaChip over the last 6 years.” Mr. Kim added, “Ms. Park is a highly valued member of the executive team, and we are fortunate that she will be continuing her leadership role in a strong finance and accounting team with a deep bench of talent.”

Jonathan Kim said, “It has been an honor to be a part of MagnaChip’s management team, serving its many stakeholders and assisting with the turnaround and growth of the Company. I wish to thank the Board, management team and employees of MagnaChip for their support during my tenure.”

Strategic Evaluation Process for Foundry Business and Fab 4
Our strategic evaluation process continues to make progress, including having discussions with multiple interested parties toward a possible sale of the Company’s Foundry business and Fab 4, as well as consideration of accretive business conversions and other options related to that business. Our decisions regarding the outcome of the various options of the strategic evaluation process will be guided by what the Board and management consider to be the best available path to improve MagnaChip’s profitability and to maximize shareholder value.

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 41 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, 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
Investor Relations
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82-2-6903-5223
chankeun.park@magnachip.com

MagnaChip Revenue of $200.0 Million At High-End of Updated Q4 2019 Guidance Range; OLED Revenue of $67.3 Million in Fourth Quarter Up Two-Fold Year-Over-Year

– Gross Margin of 26.6% in Q4 Slightly Above Mid-Point of Updated Guidance Range
– Cash of $151.7 Million, Up 15.5% Sequentially; $20.5 Million Net Operating Cash Flow
– Revenue of $792.2 Million for 2019 Up 5.5%; OLED, Power Revenue Set Annual Records

 

SEOUL, South Korea and SAN JOSE, Calif., Feb. 19, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (NYSE: MX) today announced financial results for the fourth quarter of 2019 and full year.

Q4 2019 Highlights

Revenue of $200.0 million exceeded high-end of original guidance range of $181-191 million provided on October 23, 2019; met high-end of updated
guidance range of $198-200 million provided on January 13, 2020.
Q4 revenue up 11.5% Year-over-Year (YoY); down 12.9% Quarter over Quarter (QoQ) due primarily to normal seasonal softness; OLED revenue
significantly better-than-expected, Foundry revenue better-than-expected, and Power revenue softer-than-expected.
OLED DDIC revenue of $67.3 million sets record; up two-fold YoY and down 14.0% QoQ
Power standard products revenue of $37.8 million, down 18.1% YoY; down 22.4% QoQ
Foundry Services Group (FSG) revenue of $86.6 million, up 4.2% YoY; down 4.1% QoQ
Total gross profit margin of 26.6% exceeded original guidance range of 24-26%; exceeded the mid-point of updated guidance range of 26-27%,
driven primarily by higher-than-expected fab utilization, an improved OLED product mix and better manufacturing yields at an external foundry on
latest-generation OLED display drivers.
Balance sheet: Cash and cash equivalents totaled $151.7 million, up 15.5% sequentially from $131.3 million, and highest in six years; $20.5 million
net operating cash flow; third consecutive quarter of net positive operating cash flow.

2019 Summary

Revenue of $792.2 million, up 5.5% YoY from $750.9 million
Record OLED revenue of $267.1 million, up 42.1% from $188.0 million in 2018
Record Power revenue of $176.2 million, up 4.1% from $169.3 million in 2018
Foundry revenue of $307.1 million, down 5.6% from $325.3 million in 2018
Total gross profit margin of 22.8%, despite abnormally low gross margin in Q1 2019

CEO YJ Kim comments on Coronavirus and Q1 2020 financial guidance
On behalf of MagnaChip, let me extend our deepest thoughts and prayers to those coping with the impact of the COVID-19 coronavirus in China and elsewhere. From a business perspective, we are still assessing the potential impact since the coronavirus situation is still very dynamic. MagnaChip historically has experienced typical seasonal softness and a decline in revenue in its first quarter as compared to the prior fourth quarter, but we entered 2020 with a more optimistic view. Prior to the coronavirus outbreak, our preliminary internal forecast had anticipated Q1 2020 revenue would be slighter higher than the $200 million in revenue we reported in Q4 2019.

MagnaChip’s manufacturing supply chain resides largely outside China so there is negligible impact on our results. However, based on our preliminary assessments, public health measures taken in China to protect the population likely will affect customer demand in Q1. As a result, we’ve lowered our internal expectation and widened the typical guidance range we normally would provide for Q1 2020 to help account for lingering uncertainty around this public health crisis. While actual results may vary based upon events that are still unfolding, MagnaChip currently anticipates, based on best available current estimates, in Q1 2020:

Revenue to be in the range of $180 million to $195 million, down 6.2% at the mid-point of the projected range when compared with revenue of
$200.0 million in the fourth quarter of 2019, and up 19.1% year-over-year when compared to revenue of $157.4 million in the first quarter of 2019.
Gross profit margin to be in the range of 23% to 25%, when compared to 26.6% in the fourth quarter of 2019 and 14.4% in the first quarter of 2019.

CEO YJ Kim comments on business highlights
Revenue of $200.0 million was the highest level achieved in a fourth quarter since 2012, primarily due to significantly better-than-expected revenue for our OLED display drivers as well as better-than-expected revenue in our Foundry business. OLED revenue in the fourth quarter increased two-fold year-over-year, driven primarily by a sharp increase in demand for our latest generation 28-nanometer display drivers. We enter 2020 with an OLED driver lineup about twice as large as a year ago, and we’re positioned for continued long-term growth with OLED drivers that meet the dual technical requirements for low power and high-resolution displays in next-generation 5G-enabled smartphones and new foldables. Power revenue declined 18.1%, more than had been expected in Q4, due to pricing pressure and weakness in the industrial and television markets. However, Power revenue in 2019 showed growth for the third consecutive year, and revenue from premium Power products increased by more than 20% in 2019 over the prior year. Our Foundry revenue in the fourth quarter increased 4.2% year-over-year and was at the highest level for 8″ foundry revenue since our initial public offering in 2011.

Strategic Evaluation Process
We continue to make substantial progress in discussions with multiple interested parties toward a possible sale of the business as well as consideration of accretive business conversions and other options. We reiterate that our decisions regarding the outcome of the various options of the strategic evaluation process will be guided by what the Board and management consider to be the best available path to improve MagnaChip’s profitability and to maximize shareholder value.

Fourth Quarter Financial Review
Total Revenue
Total revenue in the fourth quarter was $200.0 million, up 11.5% as compared to reported revenue of $179.4 million from the fourth quarter of 2018, and down 12.9% from $229.7 million in the third quarter of 2019.

Segment Revenue
Foundry Services Group revenue in the fourth quarter was $86.6 million, up 4.2% from the fourth quarter of 2018, and down 4.1% sequentially. Standard Products Group revenue in the fourth quarter was $113.3 million, up 17.7% from the fourth quarter of 2018, and down 18.6% sequentially.

Total Gross Profit and Gross Profit Margin
Total gross profit in the fourth quarter of 2019 was $53.2 million or 26.6% as a percentage of revenue, as compared with a gross profit of $43.9 million or 24.5% as a percentage of revenue in the fourth quarter of 2018, and $60.9 million or 26.5% as a percentage of revenue in the third quarter of 2019.

Segment Gross Profit Margin
Foundry Services Group gross profit margin in the fourth quarter was 26.1% as compared with 23.2% in the fourth quarter of 2018 and 28.3% in the third quarter of 2019. The YoY in the Foundry Services Group’s gross profit margin was primarily due to an improved product mix. The Standard Products Group gross profit margin in the fourth quarter was 26.9% as compared with 25.6% in the fourth quarter of 2018 and 25.3% in the third quarter of 2019. The YoY and sequential improvement in the Standard Products Group’s gross profit margin was due primarily to an improved product mix, and stabilized wafer yields from external suppliers on OLED products that entered production in the third quarter of 2019.

Operating Income, Net Income, Adjusted Net Income, Adjusted EBITDA
Operating income was $10.0 million for the fourth quarter of 2019 as compared to operating income of $7.9 million for the fourth quarter of 2018 and $25.9 million in the third quarter of 2019.

Net income, on a GAAP basis, was $23.4 million or $0.68 per basic share and $0.54 per diluted share in the fourth quarter of 2019 as compared with net loss of $2.4 million or $0.07 per basic and diluted share in the fourth quarter of 2018 and net loss of $1.6 million or $0.05 per basic and diluted share in the third quarter of 2019.

Adjusted Net Income, a non-GAAP financial measure, totaled $13.2 million or $0.38 per basic share and $0.32 per diluted share in the fourth quarter of 2019 as compared to Adjusted Net Income of $3.5 million or $0.10 per basic and diluted share in the fourth quarter of 2018 and Adjusted Net Income of $20.9 million or $0.61 per basic share and $0.49 per diluted share in the third quarter of 2019.

Adjusted EBITDA, a non-GAAP financial measure, was $27.7 million or 13.8% of revenue in the fourth quarter of 2019 as compared to Adjusted EBITDA of $17.4 million or 9.7% of revenue in the fourth quarter of 2018 and Adjusted EBITDA of $35.5 million or 15.4% of revenue in the third quarter of 2019.

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 $151.7 million in the fourth quarter, up from $131.3 million in the third quarter of 2019.

Fourth Quarter 2019 and Recent Company Highlights
MagnaChip:

Announced that CEO YJ Kim was awarded the National Industrial Service Medal by the Korean President in acknowledgement of his efforts to attract investment and encourage job development in Korea. The medal was presented at the annual ‘Foreign Company Day’ ceremony hosted by the Korea Ministry of Industry, Trade and Energy, and the Korea Foreign Company Association (FORCA).
http://investors.magnachip.com/news-releases/news-release-details/magnachip-semiconductor-ceo-yj-kim-awarded-koreas-prestigious
Was nominated as a 2019 Finalist for the award of “Most Respected Emerging Public Semiconductor Company” by the Global Semiconductor Alliance.

2019 Global Semiconductor Alliance Award Nominees Announced

Fourth Quarter 2019 Earnings Conference Call
The earnings conference call will be webcast live today (February 19, 2020) at 5:00 p.m. ET, 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 7994839. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.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 7994839.

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 41 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, 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 but not limited to first quarter 2020 revenue and gross profit margin 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, the risk that the strategic evaluation and the initiatives related thereto described above are not successful, public health issues, including the outbreak of COVID-19, coronavirus, and other business interruptions that could disrupt supply or delivery of, or demand for, MagnaChip’s products, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 22, 2019 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. +82-2-6903-5223
chankeun.park@magnachip.com

Magnachip Schedules Fourth Quarter 2019 Earnings Release and Conference Call for February 19

 

SEOUL, South Korea and SAN JOSE, Calif., Feb. 3, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX) announced today it will host a conference call on Wednesday, February 19, 2020 at 5 p.m. ET to discuss the Company’s financial results for the fourth quarter of 2019. 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 7994839 Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.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 7994839.

About MagnaChip Semiconductor
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 Groups provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with about 40 years of operating history, owns a portfolio of approximately 2,900 registered patents and pending applications, 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
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 Semiconductor Provides Updated Guidance for Q4 2019 Financial Results

– Revenue now expected to be in the range of $198-200 million as compared to previous estimate of $181-191 million
– Gross profit margin expected to be in the range of 26-27% as compared to previous estimate of 24-26%
– Strategic evaluation process for Foundry business and Fab 4 remains ongoing

SEOUL, South Korea and SAN JOSE, Calif., Jan.13, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (NYSE: MX) today provided an update to its previous guidance for the fourth quarter of 2019.

Revenue in the fourth quarter of 2019, ended December 31, is now expected to be in the range of $198-200 million, and gross profit margin is expected to be in the range of 26-27%, based on unaudited preliminary financial estimates. This updated guidance for the fourth quarter compares to the Company’s previous guidance of revenue to be in the range of $181-191 million and gross profit margin to be in the range of 24-26%.

The previous revenue guidance provided on October 23, 2019, in conjunction with the public release of the financial results for the third quarter of 2019, reflected an expectation at that time that revenue in the fourth quarter would reflect normal seasonal softness in the OLED, Power and Foundry businesses. While seasonal softness was a factor for all three businesses, OLED revenue was significantly better than had been expected. The Power standard products business was seasonally softer than had been expected, and Foundry revenue was seasonally soft, but better than had been expected.

The previous gross profit margin guidance for the fourth quarter, provided on October 23, 2019, reflected an expectation at that time that fab utilization would decline, reflecting normal seasonal softness. However, increased fab loading along with a richer OLED product mix contributed to better-than-expected gross profit margin results in the fourth quarter, as compared to previous estimates.

MagnaChip also reiterated today that the strategic evaluation of its Foundry business and Fab 4, the larger of the Company’s two 8″ manufacturing facilities, is ongoing. As was previously announced on October 23, 2019, the Company continues to make substantial progress on the strategic evaluation process, including discussions with multiple interested parties toward a possible sale of the business, as well as consideration of accretive business conversions, joint ventures and partnerships.

MagnaChip’s updated revenue and gross profit margin guidance for the fourth quarter of 2019 is not a comprehensive statement of financial results, and actual figures may vary. The Company expects to announce full financial results for the fourth quarter in February.

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 about 40 years of operating history, owns a portfolio of approximately 3,000 registered patents and pending applications, 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 2019 revenue and gross profit margin 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, 2019 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. +82-2-6903-5223
chankeun.park@magnachip.com

— Q3 Revenue at High-End of Guidance Range; Gross Profit Margin of 26.5% Exceeds Guidance Range —

SEOUL, South Korea and SAN JOSE, Calif., Oct. 23, 2019 /PRNewswire/ — MagnaChip Semiconductor Corporation (NYSE: MX) today announced financial results for the third quarter of 2019.

Q3 2019 Summary

Revenue of $229.7 million at high-end of guidance range of $220-230 million; Q3 revenue up 11.5% Year-over-Year (YoY); up 12% Quarter-over-Quarter (QoQ)
Standard Products Group (SPG) revenue of $139.2 million, up 14.1% YoY; up 5.5% QoQ
Display standard products revenue of $90.6 million, up 16.7% YoY; up 7.5% QoQ
OLED display driver IC revenue of $78.3 million up 34.2% YoY; up 7.2% QoQ
Power standard products revenue of $48.7 million, up 9.5% YoY; up 2.0% QoQ
Foundry Services Group (FSG) revenue of $90.3 million, up 7.7% YoY; up 23.6% QoQ
Total gross profit margin (GPM) of 26.5% exceeded the guidance range of 22-24%; GPM was 27.1% in Q3 2018; 21.4% in Q2 2019

Fourth Quarter 2019 Business Outlook
MagnaChip anticipates:
Normal seasonal softness in revenue but improvement from the fourth quarter of 2018. Revenue is expected to be in the range of $181 million to $191 million, down 19% at the mid-point of the projected range when compared with revenue of $229.7 million in the third quarter of 2019, and up 3.7% year-over-year when compared to revenue of $179.4 million in the fourth quarter of 2018.
Gross profit margin to be in the range of 24% to 26%, when compared to 26.5% in the third quarter of 2019 and 24.5% in the fourth quarter of 2018. Gross margin guidance for the fourth quarter reflects the current expectation that fab utilization will show an expected sequential decline from the third quarter of 2019.

CEO YJ Kim comments on Q3
Revenue of $229.7 million was the highest quarterly level achieved since we went public in 2011. Our Display and Power businesses both had record quarterly revenue, and Foundry revenue was at the highest level in five years. Demand continued to be robust for our OLED display drivers, as revenue increased over 34% year-over-year and over 7% sequentially.

We were awarded a record 11 new design wins for OLED display drivers in Asia, including three for mid-range smartphones from a major smartphone maker in Korea. Of the 11 design wins, seven were for display drivers in our 40-nanometer product family and four were for our new and lowest-power 28-nanometer display drivers. Smartphone makers in Asia launched a total of six high-end and mid-range models using our OLED display drivers. Our Power business showed sequential growth and the Foundry business showed sharp sequential growth, as customer demand was strong, particularly from the smartphone and computing segments.

Strategic Evaluation Process
“I’m pleased to report that we continue to make substantial progress on our previously announced strategic evaluation process of the Foundry business and Fab 4, including discussions with multiple interested parties toward a possible sale of the business as well as consideration of accretive business conversions, joint ventures and partnerships,” said YJ Kim, CEO. “As stated previously, our decisions regarding the outcome of the various options of the strategic evaluation process will be guided by what the management and Board consider to be the best available path to improve MagnaChip’s profitability and to maximize shareholder value.”

CFO Jonathan Kim comments on Q3
Total revenue came in at the high-end of our guidance range, as Display, Power and Foundry all showed year-over-year and sequential revenue growth. Gross profit margin of 26.5% in Q3 exceeded our guidance range due primarily to higher-than-expected fab utilization, mainly as a result of a significant increase in Foundry revenue.

Cash and cash equivalents totaled $131.3 million, up sequentially from $123.8 million, and net operating cash flow was $12.9 million, marking the second consecutive quarter of net positive operating cash flow.

Third Quarter Financial Review
Total Revenue
Total revenue in the third quarter was $229.7 million, up 11.5% as compared to reported revenue of $206 million from the third quarter of 2018, and up 12.0% from $205.1 million in the second quarter of 2019.

Segment Revenue
Foundry Services Group revenue in the third quarter was $90.3 million, up 7.7% from the third quarter of 2018, and up 23.6% sequentially. Standard Products Group revenue in the third quarter was $139.2 million, up 14.1% from the third quarter of 2018, and up 5.5% sequentially.

Total Gross Profit and Gross Profit Margin
Total gross profit in the third quarter of 2019 was $60.9 million or 26.5% as a percentage of revenue, as compared with gross profit of $55.7 million or 27.1% as a percentage of revenue in the third quarter of 2018, and $43.8 million or 21.4% as a percentage of revenue in the second quarter of 2019.

Segment Gross Profit Margin
Foundry Services Group gross profit margin was 28.3% as compared with 24.4% in the third quarter of 2018 and 16.7% in the second quarter of 2019. The YoY and sequential improvement in the Foundry Services Group’s gross profit margin was primarily due to an increase in Foundry revenue, an improved product mix and also higher fab utilization. The Standard Products Group gross profit margin was 25.3% as compared with 28.8% in the third quarter of 2018 and 23.9% in the second quarter of 2019. The sequential improvement in the Standard Products Group’s gross profit margin was due primarily to an increase in fab utilization. The sequential improvement as well as a YoY decline in the Standard Product Group’s gross profit margin was due to an increase in fab utilization that benefited Power and non-OLED products manufactured in-house, but the gain was offset by temporarily lower wafer yields from external suppliers on OLED products that recently entered production.

Operating Income, Net Income, Adjusted Net Income, Adjusted EBITDA
Operating income was of $25.9 million for the third quarter of 2019, as compared to operating income of $18.3 million in the third quarter of 2018 and operating income of $6.7 million for the second quarter of 2019.

Net loss, on a GAAP basis, was $1.6 million or $0.05 cents per basic and diluted share in the third quarter of 2019 as compared with a net income of $17.2 million or $0.50 per basic share and $0.41 per diluted share in the third quarter of 2018 and net loss of $9.5 million or $0.28 per basic and diluted share in the second quarter of 2019.

Adjusted Net Income, a non-GAAP financial measure, totaled $20.9 million or $0.61 per basic share and $0.49 per diluted share in the third quarter of 2019, as compared to Adjusted Net Income of $13.3 million or $0.38 per basic share and $0.32 per diluted share in the third quarter of 2018 and Adjusted Net Income of $2.9 million or $0.08 per basic and diluted share in the second quarter of 2019.

Adjusted EBITDA, a non-GAAP financial measure, was $35.5 million or 15.4% of revenue in the third quarter of 2019 as compared to Adjusted EBITDA of $27.9 million or 13.5% of revenue in the third quarter of 2018 and Adjusted EBITDA of $17.0 million or 8.3% of revenue in the second quarter of 2019.

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 $131.3 million in the third quarter, up from $123.8 million in the second quarter of 2019.

Third Quarter 2019 and Recent Company Highlights
MagnaChip announced:

Its cumulative shipments of OLED DDICs (Display Driver ICs) surpassing the 500 million milestone. OLED display drivers are low-power devices that offer excellent screen resolution with deep and bright colors for mobile screens that do not require a backlight, They also enable full-screen, rounded edges and thinner and lighter smartphones. MagnaChip first introduced the OLED DD IC in 2003 and began mass production in 2007.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-surpasses-500-million-milestone-cumulative-shipments

Offering of 0.35 micron 700V Ultra-High Voltage process technologies (UHV) suitable for different system requirements for AC-DC converter ICs and LED driver ICs. Currently the market demand is increasing dramatically for AC-powered products, including LED lighting drivers, AC-DC converter ICs and AC-DC chargers commonly found in home appliances. Due to increased competition, the cost competitiveness of these products, manufactured using UHV technologies, is becoming a critical consideration for IC providers.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-offers-035-micron-700v-ultra-high-voltage-process-1

The release of a 100V Mid-Voltage MOSFET (Metal Oxide Semiconductor Field-Effect Transistor) with a new thermal package (“M2PAK-7P”) designed for the fast-growing e-Bike market. This MOSFET with the M2PAK-7P package is suitable to meet the particular requirements of electric bike (e-Bike) systems. E-Bikes, an emerging trend along with electric scooters, have become an integral part of new eco-friendly wave of transportation and represents a “green personal mobility” movement in large urban markets.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-targets-fast-growing-e-bike-market-high-performance

Third Quarter 2019 Earnings Conference Call
The earnings conference call will be webcast live today (October 23, 2019) at 5:00 p.m. ET, 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 4069039. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.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 4069039.

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 about 40 years of operating history, owns a portfolio of approximately 3,000 registered patents and pending applications, 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 but not limited to fourth quarter 2019 revenue and gross profit margin 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, the risk that the strategic evaluation and the initiatives related thereto described above are not successful, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 22, 2019 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. +82-2-6903-5223
chankeun.park@magnachip.com