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MagnaChip Reports Fourth Quarter and Full Year 2018 Financial Results And Announces Strategic Review Process of its Foundry Operations

SEOUL, South Korea and SAN JOSE, Calif., Feb. 14, 2019 /PRNewswire/ -- MagnaChip Semiconductor Corporation (MX) today announced financial results for the fourth quarter and full year 2018. Revenue in the fourth quarter was $179.4 million and gross profit margin was 24.5%. For the year 2018, revenue was $750.9 million and gross margin was 26.4%.

MagnaChip also announced today that it has undertaken a strategic evaluation of the Company's Foundry business and Fab 4, the larger of the Company's two 8" manufacturing facilities. Fab 4 is an analog and mixed signal fab that produces approximately 73% of the Company's total capacity, and is used primarily to meet wafer demand from Foundry customers that rely on outside suppliers. The strategic evaluation is expected to include a range of possible options, including, but not limited to, joint ventures, strategic partnerships as well as M&A possibilities. The Company has retained financial and legal advisors to assist in the evaluation.

Nader Tavakoli, Chairman of the Board of MagnaChip, said, "The Board is committed to improving MagnaChip's profitability and unlocking shareholder value. As we undertake this strategic evaluation of the Foundry business, we will be mindful of the best interests of all of our stakeholders including shareholders, customers and employees."

In commenting on the Company's financial performance in Q4, YJ Kim, CEO of MagnaChip, said, "We are pleased to have met our revenue guidance in the seasonally soft fourth quarter despite a challenging macroeconomic backdrop, a slowdown in China, and an inventory correction by customers." 

In commenting on the 2018 financial results, Mr. Kim said, "Our OLED and Power businesses both had record annual revenue in 2018 and are positioned for success in 2019 due to a strong product lineup, robust product roadmap and well-established customer traction. Higher-margin Premium Power products represented over 45% of total Power revenue in Q4, due mainly to growth in the industrial, television, and lighting markets. In the OLED business, MagnaChip secured new design wins for display driver ICs from China smartphone makers and three design wins from a major smartphone maker in Korea for a line of mid-range smartphones. Our latest and lowest-power 28 nanometer OLED display driver IC will sample at the end of this month, and we anticipate volume production in the second half of this year." Mr. Kim added, "Our foundry business under-performed in Q4 2018 on an "as adjusted" basis, due in part to an inventory correction by customers that caused a drop in utilization in Fab 4. We expect utilization in Fab 4 will decline significantly further in the first half of 2019, due in part to a continuing inventory correction and our decision to be more selective about business as we undergo our strategic evaluation process."

Q4 2018 Summary

  • Revenue of $179.4 million within guidance range of $174-$184 million; revenue up 2.8% Year-over-Year (YoY) 
  • Standard Products Group revenue of $96.3 million up 2.5% YoY on an "as reported" basis; up 14.3% on an "as adjusted" basis
  • Foundry Services Group revenue of $83.1 million up 3.1% YoY on an "as reported" basis; down 8.0% on an "as adjusted" basis 
  • Record Power standard products revenue of $46.1 million; up 14.6% YoY
  • Total gross profit margin of 24.5% was below the guidance range of 25-27%; gross margin down 3.8 percentage points YoY primarily due to lower Foundry-related fab utilization and increased costs for wafers
  • Operating income of $7.9 million, or 4.4% of revenue, up 2.9% YoY and Net Loss, on a GAAP basis, of $2.4 million, down 105.5% YoY
  • Adjusted EBITDA of $17.4 million, or 9.7% of revenue, down 15.4% YoY

Full Year 2018 Summary

  • Revenue of $750.9 million, up 10.5% YoY
  • Record OLED revenue of $188.0 million, up 3-fold YoY
  • Record Power revenue of  $169.3 million, up 13.0% YoY
  • Foundry revenue of $325.3 million, up 1.6% YoY on an "as reported" basis; down 7.2% on an "as adjusted" basis
  • Gross margin of 26.4% declined by 1.2 percentage points YoY primarily due to lower Foundry-related fab utilization

First Quarter 2019 Business Outlook
For the first quarter of 2019, MagnaChip anticipates:

  • Revenue in this seasonally soft quarter to be in the range of $150 million to $155 million, down sequentially about 15.0% at the mid-point of the projected range. The guidance for the first quarter of 2019 compares with revenue of $179.4 million in the fourth quarter of 2018, and $165.8 million in the first quarter of 2018.
  • Gross profit margin to be in the range of 14% to 16%. This compares to 24.5% in the fourth quarter of 2018, and 26.9% in the first quarter of 2018.

Both revenue and gross profit margin guidance reflect a downturn in the Foundry business due in part to a continuing inventory correction and the Company's decision to be more selective about business as it undergoes a strategic evaluation process.

Fourth Quarter Financial Review

Total Revenue
Total revenue in the fourth quarter of 2018 was $179.4 million, up 2.8% as compared to reported revenue of $174.6 million from the fourth quarter of 2017, and down 12.9% from $206.0 million in the third quarter of 2018. 

Segment Revenue and Segment Adjustments
In January 2018, as part of our ongoing portfolio optimization effort to realign business processes and streamline our organizational structure, we transferred a portion of our non-OLED display solutions business ("Transferred Business"), which represented $13.4 million of net sales for Q4 2018 and $33.0 million of net sales for the 2018 year, from our Standards Products Group to our Foundry Services Group. The corresponding non-OLED display business represented $30.3 million of net sales for the year ended December 31, 2017. As a result, the historical financial results in the tables below are discussed both on an "as reported" basis, which presents the Transferred Business in the Standards Products Group results, and "as adjusted" basis, which presents the Transferred Business in the Foundry Services Group results, for comparative purposes.

Foundry Services Group revenue in the fourth quarter was $83.1 million, up 3.1%, on an "as reported" basis from the fourth quarter of 2017, and down 0.9% from $83.9 million in the third quarter of 2018; and on an "as adjusted" basis, down 8.0% from $90.3 million in the fourth quarter of 2017.

Following the strategic realignment and portfolio optimization discussed above, Standard Products Group revenue in the fourth quarter was $96.3 million, up 2.5% year-over-year on an "as reported" basis, and down 21.1% sequentially; and on an "as adjusted" basis, up 14.3% year-over-year.

The improved results in the Standard Products Group year-over-year were primarily attributable to a sharp increase in revenue from mobile OLED display driver ICs in connection with the introduction of new OLED smartphones from China manufacturers, which was offset in part by a strategic reduction of low-margin LCD business. In addition, the increase was also attributable to a higher demand for premium Power products such as high-end MOSFETs and IGBTs, primarily for TV and industrial applications.

Total Gross Profit and Gross Profit Margin
Total gross profit in the fourth quarter of 2018 was $43.9 million or 24.5% as a percentage of sales as compared with gross profit of $49.4 million or 28.3% in the fourth quarter of 2017, and $55.7 million or 27.1% in the third quarter of 2018.   

Segment Gross Profit Margin
Foundry Services Group gross profit margin was 23.2% in the fourth quarter of 2018 as compared with, on an "as reported" basis, 31.7% in the fourth quarter of 2017 and 24.4% in the third quarter of 2018. The Foundry Services Group gross profit margin was, on an "as adjusted" basis, 30.4% in the fourth quarter of 2017. The Standard Products Group gross profit margin was 25.6% in the fourth quarter of 2018 as compared with, on an "as reported" basis, 25.3% in the fourth quarter of 2017, and 28.8% in the third quarter of 2018. The Standard Products Group gross profit margin was, on an "as adjusted" basis, 25.9% in the fourth quarter of 2017.

Operating Income, Net Income, Adjusted Net Income, Adjusted EBITDA
Operating income, on a GAAP basis, for the fourth quarter was $7.9 million as compared with $7.6 million in the fourth quarter of 2017 and $18.3 million in the third quarter of 2018.

Net loss, on a GAAP basis, for the fourth quarter was $2.4 million or $0.07 cents per basic and diluted share as compared with net income of $43.7 million or $1.28 per basic share and $0.99 per diluted share in the fourth quarter of 2017, and net income of $17.2 million or $0.50 per basic share and $0.41 per diluted share in the third quarter of 2018.

Adjusted Net Income, a non-GAAP financial measure, for the fourth quarter of 2018 totaled $3.5 million or $0.10 per basic share and $0.10 per diluted share, as compared with Adjusted Net Income of $9.1 million or $0.27 per basic share and $0.23 per diluted share in the fourth quarter of 2017, and compared with 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.

Adjusted EBITDA, a non-GAAP financial measure, in the fourth quarter was $17.4 million or 9.7% of revenue as compared with Adjusted EBITDA of $20.5 million or 11.8% of revenue in the fourth quarter of 2017, and compared with Adjusted EBITDA of $27.9 million or 13.5% of revenue in the third quarter of 2018.

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 $132.4 million at the end of the fourth quarter, slightly down from $133.5 million at the end of the third quarter of 2018.  

Note: The following table sets forth information relating to our operating segments (in thousands).  The historical amounts below are presented both on an "as reported" and "as adjusted" basis to show the impact of the strategic realignment and transfer of a portion of the non-OLED Display business from the Standard Products Group to the Foundry Services Group beginning in the first quarter of 2018:

 



Three Months Ended




December 31,

2018



December 31,

2017

As Reported



December 31,

2017

As Adjusted


Net Sales













Foundry Services Group


$

83,114



$

80,629



$

90,300


Standard Products Group













Display Solutions



50,127




53,671




44,000


Power Solutions



46,131




40,241




40,241


Total Standard Products Group


$

96,258



$

93,912



$

84,241


All other



22




39




39


Total net sales


$

179,394



$

174,580



$

174,580






Year Ended




December 31,

2018



December 31,

2017

As Reported



December 31,

2017

As Adjusted


Net Sales













Foundry Services Group


$

325,312



$

320,089



$

350,395


Standard Products Group













Display Solutions



256,113




209,539




179,233


Power Solutions



169,284




149,836




149,836


Total Standard Products Group


$

425,397



$

359,375



$

329,069


All other



189




208




208


Total net sales


$

750,898



$

679,672



$

679,672


 




























Three Months Ended




December 31, 2018



December 31, 2017

As Reported



December 31, 2017

As Adjusted




Amount



% of

Net Sales



Amount



% of

Net Sales



Amount



% of

Net Sales


Gross Profit

























Foundry Services Group


$

19,286




23.2%



$

25,564




31.7%



$

27,454




30.4%


Standard Products Group



24,604




25.6




23,748




25.3




21,858




25.9


All other



22




100.0




39




100.0




39




100.0


Total gross profit


$

43,912




24.5%



$

49,351




28.3%



$

49,351




28.3%






Year Ended




December 31, 2018



December 31, 2017

As Reported



December 31, 2017

As Adjusted




Amount



% of

Net Sales



Amount



% of

Net Sales



Amount



% of

Net Sales


Gross Profit

























Foundry Services Group


$

82,578




25.4%



$

95,458




29.8%



$

101,780




29.0%


Standard Products Group



115,478




27.1




92,227




25.7




85,905




26.1


All other



40




21.2




208




100.0




208




100.0


Total gross profit


$

198,096




26.4%



$

187,893




27.6%



$

187,893




27.6%


 

Fourth Quarter 2018 and Recent Company Highlights

MagnaChip announced:

  • The introduction of a new High-Voltage Super Junction MOSFET with a 900V breakdown voltage and low total gate charge (Qg). The device with two package types, I-PAK and D-PAK, will be manufactured in high volume in the first quarter of 2019. http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=223&page=1
  • Volume production of a new Display Driver IC (DDIC) for automotive panel displays has commenced. MagnaChip is planning to expand its business to various automotive display applications, starting with the design-win of a new product at a leading Japanese panel maker of automotive CSD (Center Stack Display) panels. The application of this LCD-based display driver product will be further extended to a wide range of automotive applications such as instrument cluster, GPS navigation and car entertainment displays in the future. Over time, it is widely anticipated that OLED display drivers also will be adopted for use in automotive applications.
    http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=224&page=1
  • Appointment of Jeong Ki Min to the newly created position of Chief of Strategic Planning. Mr. Min, a seasoned semiconductor executive with 33 years of global business experience, previously held senior positions at Samsung Semiconductor, Samsung Electronics, Samsung Display, and SK Telecom. During his more than three decades in the high-tech industry, Mr. Min has initiated and negotiated high-profile joint venture agreements, strategic alliances and acquisitions. Among his other accomplishments, Mr. Min also has led new business planning teams, managed R&D operations, led Foundry marketing teams, and helped develop semiconductor growth strategies. 
    http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=226&page=1
  • It now offers Foundry customers a 0.18 micron BCD (Bipolar-CMOS-DMOS) 200V high-voltage process. This new BCD process uses SOI (Silicon On Insulator) substrates with solid high-voltage isolation and extends MagnaChip's existing BCD processes from 100V to 200V. Having 200V devices in a BCD process is valuable because it enables a Power IC to be designed for high voltage applications, including automobiles, electrical vehicles, industrial motor drivers, ultrasonic medical imaging systems and solar panels. http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=227&page=1 
  • Volume production has commenced for an IGBT product for power module targeted to high-voltage industrial applications. IGBT is one of a MagnaChip family of Power standard products called Insulated Gate Bipolar Transistors.The new IGBT P-series ("MBW100T120PHF") allows designers to operate devices at an improved switching frequency, which enables reducing the size and cost of capacitors and inductive devices in circuits. http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=228&page=1 
  • The appointment of Nader Tavakoli as its new non-executive Chairman of the Board of Directors, effective November 26, 2018. Mr. Tavakoli replaces Gary Tanner as the Company's Chairman. Mr. Tanner will remain a Director on the Board and will continue to serve as a member of the Audit, Compensation and Risk Committees of the Board. Mr. Tanner joined MagnaChip's Board in August 2015, and has served as its non-executive Chairman since October 2016. Mr. Tavakoli has served on MagnaChip's Board of Directors since 2009. He has served on, and chaired, various committees of the Board, and is currently a member of the Audit, Compensation and Risk Committees. Mr. Tavakoli is the Chief Executive Officer of Cobalt International Energy and serves as a Plan Administrator of MF Global Inc. http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=229&page=1
  • The release of a low noise, low power consumption, fast transient LDO (Low Dropout) regulator that also can be designed into BGA (Ball Grid Array) SSD (Solid State Drive) components commonly used in mobile devices. An LDO regulator is a power standard product whose function can be designed into various components. http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=230&page=1
  • Availability of its third generation 0.18 micron Bipolar-CMOS-DMOS (BCD) process technology for Foundry customers. The technology is highly suitable for PMIC, DC-DC converters, battery charger ICs, protection ICs, motor driver ICs, LED driver ICs and audio amplifiers. http://www.magnachip.com/aboutus/aboutus_sub12_view.html?tname=ez_Press_Room_e&seq=231&page=1.

Fourth Quarter 2018 Conference Call
The conference call will be webcast live today (February 14, 2019) at 5:00 p.m. EST 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 9483865. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5:00 p.m. EST 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 9483865.

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 3,000 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 first 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, 2018 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:

In Korea:

Bruce Entin

Chankeun Park

Investor Relations

Director, Public Relations

Tel. +1-408-625-1262

Tel. +82-2-6903-5223

Investor.relations@magnachip.com  

chankeun.park@magnachip.com


 

CONSOLIDATED STATEMENTS OF OPERATIONS 

(In thousands of US dollars, except share data)

(Unaudited)




Three Months Ended



Year Ended




December 31,

2018



September 30,

2018



December 31,

2017



December 31,

2018



December 31,

2017


Net sales


$

179,394



$

206,000



$

174,580



$

750,898



$

679,672


Cost of sales



135,482




150,251




125,229




552,802




491,779


Gross profit



43,912




55,749




49,351




198,096




187,893


Gross profit %



24.5%




27.1%




28.3%




26.4%




27.6%


Operating expenses





















Selling, general and administrative expenses



17,516




18,566




23,631




72,639




81,775


Research and development expenses



18,536




18,918




18,083




78,039




70,523


Restructuring and other gain















(17,010)


Early termination charges















13,369


Total operating expenses



36,052




37,484




41,714




150,678




148,657


Operating income



7,860




18,265




7,637




47,418




39,236


Interest expense



(5,743)




(5,587)




(5,460)




(22,282)




(21,559)


Foreign currency gain (loss), net



(4,316)




6,002




39,297




(24,445)




65,516


Loss on early extinguishment of long-term borrowings, net



(206)










(206)





Other income, net



555




150




1,006




264




2,898


Income (loss) before income tax expenses



(1,850)




18,830




42,480




749




86,091


Income tax expenses (benefits)



530




1,608




(1,173)




4,649




1,155


Net income (loss)


$

(2,380)



$

17,222



$

43,653



$

(3,900)



$

84,936


Earnings (loss) per common share :





















- Basic


$

(0.07)



$

0.50



$

1.28



$

(0.11)



$

2.50


- Diluted


$

(0.07)



$

0.41



$

0.99



$

(0.11)



$

2.02


Weighted average number of shares—Basic



34,627,292




34,573,377




34,176,812




34,469,921




33,943,264


Weighted average number of shares—Diluted



34,627,292




46,021,610




45,573,889




34,469,921




44,755,137


























 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA AND ADJUSTED NET INCOME

(In thousands of US dollars, except share data)

(Unaudited)




Three Months Ended



Year Ended




December 31,

2018



September 30,

2018



December 31,

2017



December 31,

2018



December 31,

2017


Net income (loss)


$

(2,380)



$

17,222



$

43,653



$

(3,900)



$

84,936


Adjustments:





















Interest expense, net



5,180




5,055




5,149




20,417




20,505


Income tax expenses (benefits)



530




1,608




(1,173)




4,649




1,155


Depreciation and amortization



8,165




7,913




7,457




32,048




28,146


EBITDA



11,495




31,798




55,086




53,214




134,742


Restructuring and other gain















(17,010)


Early termination charges















13,369


Equity-based compensation expense



1,320




1,083




722




4,409




2,336


Foreign currency loss (gain), net



4,315




(6,001)




(39,297)




24,445




(65,516)


Derivative valuation loss (gain), net



144




518




(436)




2,369




(236)


Restatement related expenses









4,319




(765)




10,306


Secondary offering expenses









154







669


Loss on early extinguishment of long-term borrowings, net



206










206





Other indemnification costs and reimbursement



(89)




473







384





Adjusted EBITDA


$

17,391



$

27,871



$

20,548



$

84,262



$

78,660


Net income (loss)


$

(2,380)



$

17,222



$

43,653



$

(3,900)



$

84,936


Adjustments:





















Restructuring and other gain















(17,010)


Early termination charges















13,369


Equity-based compensation expense



1,320




1,083




722




4,409




2,336


Foreign currency loss (gain), net



4,315




(6,001)




(39,297)




24,445




(65,516)


Derivative valuation loss (gain), net



144




518




(436)




2,369




(236)


Restatement related expenses









4,319




(765)




10,306


Secondary offering expenses









154







669


Loss on early extinguishment of long-term borrowings, net



206










206





Other indemnification costs and reimbursements



(89)




473







384





Adjusted Net Income


$

3,516



$

13,295



$

9,115



$

27,148



$

28,854


Adjusted Net Income per common share:





















- Basic


$

0.10



$

0.38



$

0.27



$

0.79



$

0.85


- Diluted


$

0.10



$

0.32



$

0.23



$

0.71



$

0.76


Weighted average number of shares – Basic



34,627,292




34,573,377




34,176,812




34,469,921




33,943,264


Weighted average number of shares – Diluted



35,128,341




46,021,610




45,573,889




45,941,853




44,755,137


We present Adjusted EBITDA and Adjusted Net Income as supplemental measures of our performance. We define Adjusted EBITDA for the periods indicated as EBITDA (as defined below), adjusted to exclude (i) Restructuring and other gain, (ii) Early termination charges, (iii) Equity-based compensation expense, (iv) Foreign currency loss (gain), net, (v) Derivative valuation loss (gain), net, (vi) Restatement related expenses, (vii) Secondary offering expenses, (viii) Loss on early extinguishment of long-term borrowings, net and (ix) Other indemnification costs and reimbursements. EBITDA for the periods indicated is defined as net income (loss) before interest expense, net, income tax expenses and depreciation and amortization. We prepare Adjusted Net Income by adjusting net income (loss) to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Net Income is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Net Income for the periods as net income, adjusted to exclude (i) Restructuring and other gain, (ii) Early termination charges, (iii) Equity-based compensation expense, (iv) Foreign currency loss (gain), net, (v) Derivative valuation loss (gain), net, (vi) Restatement related expenses, (vii) Secondary offering expenses, (viii) Loss on early extinguishment of long-term borrowings, net and (ix) Other indemnification costs and reimbursements.

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands of US dollars, except share data)

(Unaudited)



December 31,

2018


 

 

December 31,

2017

Assets




Current assets




Cash and cash equivalents

$        132,438


$        128,575

Accounts receivable, net

80,003


92,026

Unbilled accounts receivable

38,181


Inventories, net

71,611


73,073

Other receivables

3,702


4,292

Prepaid expenses

11,133


9,250

Hedge collateral

5,810


7,600

Other current assets

9,867


15,444

Total current assets

352,745


330,260





Property, plant and equipment, net

202,171


205,903

Intangible assets, net

3,953


4,061

Long-term prepaid expenses

15,598


12,791

Other non-current assets

8,729


5,774

Total assets

$        583,196


$        558,789





Liabilities and Stockholders' Equity




Current liabilities




Accounts payable

$           55,631


$           65,940

Other accounts payable

15,168


10,261

Accrued expenses

46,250


51,746

Deferred revenue

6,477


8,335

Other current liabilities

9,133


1,860

Total current liabilities

132,659


138,142

Long-term borrowings, net

303,577


303,416

Accrued severance benefits, net

146,031


148,905

Other non-current liabilities

18,239


7,963

Total liabilities

600,506


598,426

Commitments and contingencies




Stockholders' equity




Common stock, $0.01 par value, 150,000,000 shares authorized, 43,054,458 shares issued and 34,441,232 outstanding at December 31, 2018 and 42,563,808 shares issued and 34,189,599 outstanding at December 31, 2017

431


426

Additional paid-in capital

142,600


136,259

Accumulated deficit

(36,305)


(40,889)

Treasury stock, 8,613,226 shares at December 31, 2018 and 8,374,209 shares at December 31, 2017, respectively

(103,926)


(102,319)

Accumulated other comprehensive loss

(20,110)


(33,114)

Total stockholders' deficit

(17,310)


(39,637)

Total liabilities and stockholders' equity

$        583,196


$        558,789

 

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of US dollars)

(Unaudited)




Three Months

Ended



 

Year Ended




December 31,

2018



December 31,

2018



December 31,

2017


Cash flows from operating activities













Net income (loss)


$

(2,380)



$

(3,900)



$

84,936


Adjustments to reconcile net income to net cash provided by (used in) operating
activities













Depreciation and amortization



8,165




32,048




28,146


Provision for severance benefits



2,958




17,644




24,373


Amortization of debt issuance costs and original issue discount



560




2,183




1,987


Loss (gain) on foreign currency, net



3,284




30,215




(77,600)


Restructuring gain and other









(17,010)


Stock-based compensation



1,320




5,213




2,336


Loss on early extinguishment of long-term borrowings, net



206




206





Other



(271)




(1,235)




49


Changes in operating assets and liabilities













Accounts receivable, net



22,576




8,294




(22,210)


Unbilled accounts receivable



(2,471)




(1,284)





Inventories, net



(379)




(30,675)




(8,077)


Other receivables



3,929




1,260




2,218


Other current assets



7,428




9,942




2,318


Accounts payable



(25,803)




(8,389)




10,320


Other accounts payable



(2,372)




(11,183)




(12,141)


Accrued expenses



640




(4,730)




(12,020)


Deferred revenue



(669)




2,891




(3,949)


Other current liabilities



590




2,123




(1,281)


Other non-current liabilities



1,311




2,346




(760)


Payment of severance benefits



(2,684)




(11,688)




(21,506)


Other



(1,716)




(2,045)




(382)


Net cash provided by (used in) operating activities



14,222




39,236




(20,253)


Cash flows from investing activities













Proceeds from settlement of hedge collateral



3,052




14,342




10,615


Payment of hedge collateral



(1,942)




(12,907)




(14,839)


Proceeds from disposal of plant, property and equipment






1,685




1,209


Purchase of plant, property and equipment



(10,073)




(28,948)




(32,661)


Payment for property related to water treatment facility arrangement






(4,283)





Payment for intellectual property registration



(185)




(961)




(1,207)


Collection of guarantee deposits



7




801




1,462


Payment of guarantee deposits



(2,927




(3,016)




(41)


Other



19




(19)




94


Net cash used in investing activities



(12,049




(33,306)




(35,368)


Cash flows from financing activities













Proceeds from issuance of senior notes









86,250


Payment of debt issuance costs









(5,902)


Repurchase of long-term borrowings



(2,228)




(2,228)





Proceeds from exercise of stock options



19




1,132




3,744


Acquisition of treasury stock



(1,408)




(1,607)




(11,401)


Proceeds from property related to water treatment facility arrangement






4,283





Repayment of financing related to water treatment facility arrangement



(213)




(286)





Net cash provided by (used in) financing activities



(3,830)




1,294




72,691


Effect of exchange rates on cash, cash equivalents and restricted cash



613




(3,361)




9,899


Net increase (decrease) in cash, cash equivalents and restricted cash



(1,044)




3,863




26,969


Cash, cash equivalents and restricted cash













Beginning of the period



133,482




128,575




101,606


End of the period


$

132,438



$

132,438



$

128,575


 

Cision

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