SEOUL, South Korea and
SAN JOSE, Calif., July 30, 2019 /PRNewswire/ -- MagnaChip
Semiconductor Corporation (NYSE: MX) today announced financial
results for the second quarter of 2019.
Q2 2019 Summary
- Revenue of $205.1 million
exceeded updated guidance of "at least" $194
million provided on June 11;
Q2 revenue up 2.7% Year-over-Year (YoY); up 30.4%
Quarter-over-Quarter (QoQ)
- Standard Products Group (SPG) revenue of $132 million, up 11.2% YoY; up 31.6% QoQ
-
- Display standard products revenue of $84.3 million, up 7% YoY; up 44.7% QoQ
-
- OLED display driver IC revenue of $73
million up 17.4% YoY; up 50.4% QoQ
- Power standard products revenue of $47.7
million, up 19.2% YoY; up 13.5% QoQ
- Foundry Services Group (FSG) revenue of $73.1 million, down 9.7% YoY; up 28.1% QoQ
- Total gross profit margin of 21.4% compared to updated guidance
of "at least" 21%" provided on June
11.
Third Quarter 2019 Business Outlook
For the third
quarter of 2019, MagnaChip anticipates:
- Revenue to be in the range of $220
million to $230 million, up
9.7% at the mid-point of the projected range when compared with
revenue of $205.1 million in the
second quarter of 2019, and up 9.2% year-on-year when compared to
$206 million revenue recorded in the
third quarter of 2018. Revenue guidance for the third quarter
reflects a current expectation that revenue for both the Standard
Products Group and Foundry Services Group will show sequential
improvement as compared to Q2 2019.
- Gross profit margin to be in the range of 22% to 24%, as
compared to 21.4% in the second quarter of 2019 and 27.1% in the
third quarter of 2018. Gross margin guidance for the third quarter
primarily reflects the current expectation that fab utilization
will show sequential improvement from the second quarter of
2019.
CEO YJ Kim comments on Q2
Revenue of $205.1 million increased 30.4% sequentially from
Q1, as results in each of our three business lines surpassed
expectations in Q2. Our OLED and Power businesses each achieved
record revenue, driven by robust customer demand for our low-power
display drivers and high-voltage Power standard products. The
Foundry business showed resilience in a tough macroeconomic
environment, with revenue increasing sharply from Q1.
At the end of April on our Q1 earnings call, we provided Q2
revenue guidance of $173-181 million,
and a range for gross profit margin of 16-18%. When it became
evident that we were on track to significantly exceed the high end
of the guidance range, we provided an updated guidance on
June 11 for revenue of at least
$194 million and gross margin of at
least 21%.
Gross profit margin of 21.4% in Q2 met the updated guidance and
our total revenue of $205.1 million
during the same period significantly exceeded the updated guidance.
The better-than-expected revenue performance was due to
stronger-than-expected customer demand across the board and
throughout the quarter. OLED revenue increased 50.4% sequentially,
Power increased 13.5% and Foundry increased 28.1%, all as compared
to Q1 2019.
Our OLED business benefited from the launch of six new OLED
smartphones in Asia. We also
secured four new design wins. Our 40-nm display driver accounted
for the majority of our OLED revenue in Q2 but our industry leading
28-nm display driver now has entered mass production and will be a
key revenue driver going forward. The pickup in revenue from the
Power business reflected healthy demand from television, industrial
and smartphone markets, with our Premium products accounting for
over half of Power revenue. The improvement in the Foundry business
reflected increased customer demand, primarily for applications in
the computer and consumer end markets, and also from
smartphones.
As for the strategic evaluation of the Foundry business and Fab
4, I'm encouraged by where we are in the ongoing process. Our
decisions regarding the outcome 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.
CFO Jonathan Kim comments on
Q2
Gross profit margin of 21.4% met our updated guidance
provided in mid-June, and was significantly higher than the
guidance range of 16-18% provided at the end of April. The
improvement in gross profit margin was due primarily to higher fab
utilization as a result of a significant increase in Foundry
loading and revenue during Q2, and despite a reserve of
$2.2 million related to a legacy
display product. Our cash balance increased in Q2 to $123.8 million from $105.8
million in Q1, and inventories declined
sequentially. We generated net operating cash flow of
$28.8 million in Q2 and $17.2 million in the first half of 2019.
Second Quarter Financial Review
Total
Revenue
Total revenue in the second quarter of 2019 was
$205.1 million, up 2.7% as compared
to reported revenue of $199.7 million
from the second quarter of 2018, and up 30.4% from $157.4 million in the first quarter of 2019.
Segment Revenue
Foundry Services Group revenue in the
second quarter was $73.1 million,
down 9.7% from the second quarter of 2018, and up 28.1%
sequentially. Standard Products Group revenue in the second quarter
was $132 million, up 11.2% from the
second quarter of 2018, and up 31.6% sequentially.
Total Gross Profit and Gross Profit Margin
Total gross
profit in the second quarter of 2019 was $43.8 million or 21.4% as a percentage of
revenue, as compared with gross profit of $53.9 million or 27% in the second quarter of
2018, and $22.7 million or 14.4% in
the first quarter of 2019.
Segment Gross Profit Margin
Foundry Services Group
gross profit margin was 16.7% as compared with 27.4% in the second
quarter of 2018 and 6.4% in the first quarter of 2019. The
sequential improvement in Foundry Services Group's gross profit
margin was primarily due to an increase in fab loading and Foundry
revenue. The Standard Products Group gross profit margin was 23.9%
in the second quarter of 2019 as compared with 26.6% in the second
quarter of 2018 and 19% in the first quarter of 2019. The
sequential improvement in Standard Product Group's gross profit
margin was primarily due to an increase in fab loading and increase
in our OLED revenues.
Operating Income, Net Income, Adjusted Net Income,
Adjusted EBITDA
Operating income of $6.7 million for the second quarter of 2019
compared to operating income of $13.9
million in the second quarter of 2018 and an operating loss
of $18.3 million in the first quarter
of 2019.
Net loss, on a GAAP basis, was $9.5
million or $0.28 per basic and
diluted share in the second quarter of 2019 as compared with a net
loss of $21.5 million or $0.62 per basic and diluted share in the second
quarter of 2018 and net loss of $34.1
million or $1.00 per basic and
diluted share in the first quarter of 2019.
Adjusted Net Income, a non-GAAP financial measure, totaled
$2.9 million or $0.08 per basic and diluted share in the second
quarter of 2019, as compared to Adjusted Net Income of $8.9 million or $0.26 per basic share and $0.23 per diluted share in the second quarter of
2018 and Adjusted Net Loss of $19.9
million or $0.58 per basic and
diluted share in the first quarter of 2019.
Adjusted EBITDA, a non-GAAP financial measure, was $17.0 million or 8.3% of revenue in the second
quarter of 2019, as compared to Adjusted EBITDA of $23.5 million or 11.8% of revenue in the second
quarter of 2018, and Adjusted EBITDA of negative $5.7 million or negative 3.6% of revenue 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. 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 $123.8
million in the second quarter of 2019, up from $105.8 million in the first quarter of 2019.
|
|
Three
Months
Ended
|
|
Six
Months
Ended
|
|
|
|
|
|
June 30,
2019
|
|
|
June 30,
2018
|
|
June 30,
2019
|
|
|
June 30,
2018
|
|
Net
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foundry Services
Group
|
|
$
|
73,098
|
|
$
|
80,907
|
|
$
|
130,173
|
|
|
$
|
158,336
|
|
Standard Products
Group
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Display
Solutions
|
|
|
84,261
|
|
|
78,712
|
|
|
142,491
|
|
|
|
128,408
|
|
Power
Solutions
|
|
|
47,723
|
|
|
40,028
|
|
|
89,753
|
|
|
|
78,695
|
|
Total Standard
Products Group
|
|
$
|
131,984
|
|
$
|
118,740
|
|
$
|
232,244
|
|
|
$
|
207,103
|
|
All other
|
|
|
63
|
|
|
38
|
|
|
108
|
|
|
|
65
|
|
Total net
sales
|
|
$
|
205,145
|
|
$
|
199,685
|
|
$
|
362,525
|
|
|
$
|
365,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
Three Months
Ended
|
|
|
|
June 30, 2019
|
|
|
June 30, 2018
|
|
|
|
Amount
|
|
|
%
of
Net Sales
|
|
|
Amount
|
|
|
%
of
Net Sales
|
|
Gross
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foundry Services
Group
|
|
$
|
12,177
|
|
|
|
16.7
|
%
|
|
$
|
22,185
|
|
|
|
27.4
|
%
|
Standard Products
Group
|
|
|
31,600
|
|
|
|
23.9
|
|
|
|
31,631
|
|
|
|
26.6
|
|
All other
|
|
|
63
|
|
|
|
100.0
|
|
|
|
38
|
|
|
|
100.0
|
|
Total gross
profit
|
|
$
|
43,840
|
|
|
|
21.4
|
%
|
|
$
|
53,854
|
|
|
|
27.0
|
%
|
|
|
Six Months Ended
|
|
|
Six Months Ended
|
|
|
|
June 30, 2019
|
|
|
June 30, 2018
|
|
|
|
Amount
|
|
|
%
of
Net Sales
|
|
|
Amount
|
|
|
%
of
Net Sales
|
|
Gross
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foundry Services
Group
|
|
$
|
15,814
|
|
|
|
12.1
|
%
|
|
$
|
42,849
|
|
|
|
27.1
|
%
|
Standard Products
Group
|
|
|
50,620
|
|
|
|
21.8
|
|
|
|
55,670
|
|
|
|
26.9
|
|
All other
|
|
|
107
|
|
|
|
99.1
|
|
|
|
(84)
|
|
|
|
(129.2)
|
|
Total gross
profit
|
|
$
|
66,541
|
|
|
|
18.4
|
%
|
|
$
|
98,435
|
|
|
|
26.9
|
%
|
Second Quarter 2019 and Recent Company Highlights
MagnaChip announced:
- A new low-Rss (on)* LV (Low Voltage) MOSFET with reduced chip
size for smartphone battery PCMs (Protection Circuit Modules).
Extended life and increased protection for batteries in high-end
LTE and 5G smartphones are becoming increasingly important.
5G phones, in particular, need longer-lasting batteries with
higher endurance than previous smartphones to process the massive
amount of data with extremely fast download and upload
capabilities. Inserted in the battery PCMs in LTE or 5G
phones, this newly released MOSFET prevents over-voltage and
over-current of the batteries and ultimately helps extend their
life and resolve the overheating issue.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-introduces-new-component-enhance-5glte-smartphone
- An update to its previous guidance for the second quarter of
2019. Revenue in the second quarter of 2019, ending June 30,
is now expected to be at least $194 million, and gross profit
margin is expected to be at least 21%. This updated guidance for
the second quarter compares to the Company's previous guidance of
revenue to be in the range of $173-181 million and gross
profit margin to be in the range of 16-18%. The previous revenue
guidance provided on April 30 in conjunction with the
public release of the financial results for the first quarter of
2019 reflected an expectation at that time that revenue from
MagnaChip's OLED Display drivers would increase by approximately
30% and that revenue from the Foundry business would be flat, both
as compared to the first quarter of 2019. However, revenue for
both OLED Display drivers and 8" Foundry services is now expected
to substantially exceed the Company's previously anticipated
financial results for the second quarter. Revenue from Power
standard products is also expected to be stronger than previously
anticipated.
MagnaChip also stated today that the strategic evaluation of its
Foundry business and Fab 4, the larger of the Company's two 8"
manufacturing facilities, is ongoing. 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. As
previously announced, the strategic evaluation includes a range of
possible options, including, but not limited to, joint ventures,
strategic partnerships and M&A possibilities. MagnaChip's
updated revenue and gross profit margin guidance for the second
quarter of 2019 is not a comprehensive statement of financial
results, and actual figures may vary.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-semiconductor-provides-updated-guidance-q2-2019
- The launch of its 28-nanometer (nm) OLED (Organic Light
Emitting Diodes) DDIC (Display Driver IC) for smartphone
displays.
The 28nm process is the most advanced process used for
manufacturing OLED DDICs today. The new 28nm OLED DDIC
achieves a form factor reduction that is 20 percent smaller than
that of the previous 40nm process and is suitable for smartphones
and other mobile devices, where small size and thinness are
critical factors. In addition, MagnaChip reduced the logic
voltage from 1.1V, which was required for the existing 40nm
products, to 1.0V, which reduces the current voltage consumption by
more than 20 percent and also extends battery life.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-launches-28-nanometer-oled-ddic-smartphone-displays
- The offering of its second-generation 0.13 micron eFlash
(Embedded Flash) technology with 20V and 30V high-voltage options.
The technology is specifically designed to address the needs for
multi-function hybrid mixed-signal products, including touch ICs,
fingerprint readout ICs and wireless power charger ICs. With
the growing complexity of analog and mixed-signal functions, IC
designers are facing increasing challenges to integrate multiple
functions in a single product.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-offers-second-generation-013-micron-embedded-flash-20v
- The launch of a 3-channel BLU (backlight unit) LED driver for
UHD TVs.
For high-resolution UHD displays, this new standard display product
is designed to control the local LED dimming of up to 270 LEDs
through a maximum of 90 LEDs per channel. In addition, it
provides a dual dimming solution with Analog and PWM (Pulse Width
Modulation) for efficient and stable LED dimming, which reduces
power consumption and helps achieve a high contrast ratio in UHD
TVs.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-launches-3-channel-blu-led-driver-uhd-tvs
- A new initiative to partner with companies in the development
of next-generation display features of smartphones and other mobile
or handheld consumer electronic devices. MagnaChip intends to
develop individual strategic partnerships with leading
manufacturers of touch, stylus, fingerprint technologies, and
associated OLED display technologies. Each company will collaborate
with MagnaChip to develop and standardize innovative
human-interface solutions based upon smart touch, stylus and
fingerprint technologies that are suitable for MagnaChip's industry
leading OLED DDICs. The goal in each instance will be to improve
the functionality of OLED displays on end user devices. There also
will be a specified collaboration in shared intellectual property
that will extend into new applications, including the IoT and
automotive sectors.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-announces-initiative-develop-next-generation-display
- A partnership with ELAN Microelectronics Corp. to expand the
capabilities for OLED displays for a wide variety of
next-generation consumer, communication, computing and industrial
products, as well as for automotive displays. The partnership seeks
to build upon the recent growth and market penetration of OLED
displays in areas such as smartphones, mobile devices, tablets and
automotive applications, ranging from navigation and infotainment
screens to brake light and interior lighting systems.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-and-elan-microelectronics-announce-partnership-expand
- A partnership with HiDeep to develop advanced OLED display
capabilities for smartphone makers and other handheld consumer
electronics devices. MagnaChip will cooperate with HiDeep to
develop enhanced HMI solutions optimized for the growing OLED
display market. Specifically, MagnaChip and HiDeep will collaborate
and create useful and cost effective new HMI solutions for flexible
OLED displays for top-tier panel makers and smartphone OEMs. This
collaboration also will extend into a variety of other applications
and end markets.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-and-hideep-inc-announce-partnership-develop-enhanced
- A partnership with Melfas Inc. to develop advanced OLED display
capabilities for the automotive and consumer electronics sectors.
Currently, OLED technology is deployed primarily in televisions and
mobile products such as smartphones and smartwatches, but MagnaChip
and Melfas are working towards developing automotive
display-related solutions in an effort to respond to this
fast-growing market. With their current solutions, the two
companies will initially address opportunities in consumer
electronics and, going forward, will work together to develop
solutions for OLED displays in automotive applications.
http://investors.magnachip.com/news-releases/news-release-details/magnachip-and-melfas-inc-announce-partnership-collaborate-oled
Second Quarter 2019 Earnings Conference Call
The
earnings conference call will be webcast live today (July 30, 2019) at 5:00
p.m. EDT, 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 8938259. 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 8938259.
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 third 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
|
MAGNACHIP
SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(In thousands of
US dollars, except share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
June 30,
2019
|
|
|
March
31,
2019
|
|
|
June 30,
2018
|
|
Net sales
|
|
$
|
205,145
|
|
|
$
|
157,380
|
|
|
$
|
199,685
|
|
Cost of
sales
|
|
|
161,305
|
|
|
|
134,679
|
|
|
|
145,831
|
|
Gross
profit
|
|
|
43,840
|
|
|
|
22,701
|
|
|
|
53,854
|
|
Gross profit
%
|
|
|
21.4
|
%
|
|
|
14.4
|
%
|
|
|
27.0
|
%
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
16,975
|
|
|
|
18,070
|
|
|
|
18,935
|
|
Research and
development expenses
|
|
|
18,989
|
|
|
|
20,018
|
|
|
|
21,005
|
|
Restructuring and
other charges
|
|
|
1,130
|
|
|
|
2,894
|
|
|
|
—
|
|
Total operating
expenses
|
|
|
37,094
|
|
|
|
40,982
|
|
|
|
39,940
|
|
Operating
income (loss)
|
|
|
6,746
|
|
|
|
(18,281)
|
|
|
|
13,914
|
|
Interest
expense
|
|
|
(5,679)
|
|
|
|
(5,637)
|
|
|
|
(5,489)
|
|
Foreign currency loss,
net
|
|
|
(10,431)
|
|
|
|
(9,997)
|
|
|
|
(27,449)
|
|
Loss on early
extinguishment of long-term borrowings, net
|
|
|
—
|
|
|
|
(42)
|
|
|
|
—
|
|
Other income
(expense), net
|
|
|
656
|
|
|
|
673
|
|
|
|
(960)
|
|
Loss before
income tax expense
|
|
|
(8,708)
|
|
|
|
(33,284)
|
|
|
|
(19,984)
|
|
Income tax
expense
|
|
|
812
|
|
|
|
841
|
|
|
|
1,521
|
|
Net loss
|
|
$
|
(9,520)
|
|
|
$
|
(34,125)
|
|
|
$
|
(21,505)
|
|
Loss per common
share :
|
|
|
|
|
|
|
|
|
|
|
|
|
- Basic /
Diluted
|
|
$
|
(0.28)
|
|
|
$
|
(1.00)
|
|
|
$
|
(0.62)
|
|
Weighted average
number of shares—Basic / Diluted
|
|
|
34,245,127
|
|
|
|
34,194,878
|
|
|
|
34,420,654
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
|
|
June 30,
2019
|
|
|
March 31,
2019
|
|
|
June 30,
2018
|
|
Net loss
|
|
$
|
(9,520)
|
|
|
$
|
(34,125)
|
|
|
$
|
(21,505)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
5,092
|
|
|
|
5,059
|
|
|
|
5,059
|
|
Income tax
expense
|
|
|
812
|
|
|
|
841
|
|
|
|
1,521
|
|
Depreciation and
amortization
|
|
|
8,202
|
|
|
|
8,303
|
|
|
|
8,012
|
|
EBITDA
|
|
|
4,586
|
|
|
|
(19,922)
|
|
|
|
(6,913)
|
|
Restructuring and
other charges
|
|
|
1,130
|
|
|
|
2,894
|
|
|
|
—
|
|
Equity-based
compensation expense
|
|
|
772
|
|
|
|
669
|
|
|
|
1,341
|
|
Foreign currency loss,
net
|
|
|
10,431
|
|
|
|
9,997
|
|
|
|
27,449
|
|
Derivative valuation
loss, net
|
|
|
80
|
|
|
|
56
|
|
|
|
1,632
|
|
Loss on early
extinguishment of long-term borrowings, net
|
|
|
—
|
|
|
|
42
|
|
|
|
—
|
|
Others
|
|
|
—
|
|
|
|
585
|
|
|
|
—
|
|
Adjusted
EBITDA
|
|
$
|
16,999
|
|
|
$
|
(5,679)
|
|
|
$
|
23,509
|
|
Net loss
|
|
$
|
(9,520)
|
|
|
$
|
(34,125)
|
|
|
$
|
(21,505)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
other charges
|
|
|
1,130
|
|
|
|
2,894
|
|
|
|
—
|
|
Equity-based
compensation expense
|
|
|
772
|
|
|
|
669
|
|
|
|
1,341
|
|
Foreign currency loss,
net
|
|
|
10,431
|
|
|
|
9,997
|
|
|
|
27,449
|
|
Derivative valuation
loss, net
|
|
|
80
|
|
|
|
56
|
|
|
|
1,632
|
|
Loss on early
extinguishment of long-term borrowings, net
|
|
|
—
|
|
|
|
42
|
|
|
|
—
|
|
Others
|
|
|
—
|
|
|
|
585
|
|
|
|
—
|
|
Adjusted Net Income
(Loss)
|
|
$
|
2,893
|
|
|
$
|
(19,882)
|
|
|
$
|
8,917
|
|
Adjusted Net
Income (Loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
- Basic
|
|
$
|
0.08
|
|
|
$
|
(0.58)
|
|
|
$
|
0.26
|
|
- Diluted
|
|
$
|
0.08
|
|
|
$
|
(0.58)
|
|
|
$
|
0.23
|
|
Weighted average
number of shares – Basic
|
|
|
34,245,127
|
|
|
|
34,194,878
|
|
|
|
34,420,654
|
|
Weighted average
number of shares – Diluted
|
|
|
34,965,562
|
|
|
|
34,194,878
|
|
|
|
45,735,521
|
|
We present Adjusted EBITDA and Adjusted Net
Income (Loss) 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 charges, (ii) Equity-based
compensation expense, (iii) Foreign currency loss, net,
(iv) Derivative valuation loss, net, (v) Loss on early
extinguishment of long-term borrowings, net and
(vi) Others. EBITDA for the periods indicated is defined as
net loss before interest expense, net, income tax expense and
depreciation and amortization. We prepare Adjusted Net
Income (Loss) by adjusting net 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 (Loss) is particularly useful
because it reflects the impact of our asset base and capital
structure on our operating performance. We define Adjusted Net
Income (Loss) for the periods as net loss, adjusted to
exclude (i) Restructuring and other charges,
(ii) Equity-based compensation expense, (iii) Foreign
currency loss, net, (iv) Derivative valuation loss, net, (v)
Loss on early extinguishment of long-term borrowings, net and
(vi) Others.
MAGNACHIP
SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(In thousands of
US dollars, except share data)
|
(Unaudited)
|
|
|
June 30,
2019
|
|
December 31,
2018
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
123,753
|
|
$
132,438
|
Accounts receivable,
net
|
96,766
|
|
80,003
|
Unbilled accounts
receivable, net
|
30,689
|
|
38,181
|
Inventories,
net
|
67,192
|
|
71,611
|
Other
receivables
|
6,606
|
|
3,702
|
Prepaid
expenses
|
13,110
|
|
11,133
|
Hedge
collateral
|
9,510
|
|
5,810
|
Other current
assets
|
8,026
|
|
9,867
|
|
|
|
|
Total current
assets
|
355,652
|
|
352,745
|
|
|
|
|
Property, plant and
equipment, net
|
192,314
|
|
202,171
|
Operating lease
right-of-use assets
|
12,518
|
|
—
|
Intangible assets,
net
|
4,023
|
|
3,953
|
Long-term prepaid
expenses
|
14,076
|
|
15,598
|
Other non-current
assets
|
9,233
|
|
8,729
|
|
|
|
|
Total
assets
|
$
587,816
|
|
$
583,196
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
86,003
|
|
$
55,631
|
Other accounts
payable
|
12,628
|
|
15,168
|
Accrued
expenses
|
49,146
|
|
46,250
|
Deferred
revenue
|
5,312
|
|
6,477
|
Operating lease
liabilities
|
2,151
|
|
—
|
Other current
liabilities
|
3,056
|
|
9,133
|
|
|
|
|
Total current
liabilities
|
158,296
|
|
132,659
|
|
|
|
|
Long-term borrowings,
net
|
303,577
|
|
303,577
|
Non-current operating
lease liabilities
|
10,367
|
|
—
|
Accrued severance
benefits, net
|
142,436
|
|
146,031
|
Other non-current
liabilities
|
21,056
|
|
18,239
|
|
|
|
|
Total
liabilities
|
635,732
|
|
600,506
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
Stockholders'
equity
|
|
|
|
Common stock,
$0.01 par value, 150,000,000 shares authorized,
43,247,509 shares issued and
34,240,181 outstanding at June 30, 2019 and 43,054,458 shares
issued and 34,441,232 outstanding at
December 31, 2018
|
433
|
|
431
|
Additional paid-in
capital
|
144,188
|
|
142,600
|
Accumulated
deficit
|
(79,950 )
|
|
(36,305 )
|
Treasury stock,
9,007,328 shares at June 30, 2019 and 8,613,226 shares at
December 31, 2018, respectively
|
(106,514 )
|
|
(103,926 )
|
Accumulated other
comprehensive loss
|
(6,073 )
|
|
(20,110 )
|
|
|
|
|
Total stockholders'
deficit
|
(47,916 )
|
|
(17,310 )
|
|
|
|
|
Total liabilities and
stockholders' equity
|
$
587,816
|
|
$
583,196
|
|
|
|
|
MAGNACHIP
SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(In thousands of
US dollars)
|
(Unaudited)
|
|
|
Three
month
Ended
|
Six
month
Ended
|
|
|
June 30,
2019
|
|
June 30,
2019
|
|
|
June 30,
2018
|
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
$
|
(9,520)
|
|
$
|
(43,645)
|
|
|
$
|
(18,742)
|
|
Adjustments to
reconcile net loss to net cash provided by operating
activities
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
8,202
|
|
|
16,505
|
|
|
|
15,970
|
|
Provision for
severance benefits
|
|
3,289
|
|
|
6,406
|
|
|
|
9,165
|
|
Amortization of debt
issuance costs and original issue discount
|
|
563
|
|
|
1,134
|
|
|
|
1,073
|
|
Loss on foreign
currency, net
|
|
12,889
|
|
|
24,609
|
|
|
|
32,369
|
|
Restructuring and
other charges
|
|
732
|
|
|
732
|
|
|
|
—
|
|
Stock-based
compensation
|
|
772
|
|
|
1,441
|
|
|
|
2,810
|
|
Loss on early
extinguishment of long-term borrowings, net
|
|
—
|
|
|
42
|
|
|
|
—
|
|
Other
|
|
(590)
|
|
|
(494)
|
|
|
|
1,053
|
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
|
(8,130)
|
|
|
(20,974)
|
|
|
|
5,305
|
|
Unbilled accounts
receivable, net
|
|
(3,525)
|
|
|
6,201
|
|
|
|
887
|
|
Inventories,
net
|
|
12,174
|
|
|
1,589
|
|
|
|
(16,797)
|
|
Other
receivables
|
|
1,236
|
|
|
(2,969)
|
|
|
|
(4,508)
|
|
Other current
assets
|
|
4,093
|
|
|
5,929
|
|
|
|
2,253
|
|
Accounts
payable
|
|
11,263
|
|
|
32,137
|
|
|
|
(4,473)
|
|
Other accounts
payable
|
|
(6,756)
|
|
|
(3,960)
|
|
|
|
(5,229)
|
|
Accrued
expenses
|
|
5,422
|
|
|
2,880
|
|
|
|
(1,435)
|
|
Deferred
revenue
|
|
(1,484)
|
|
|
(929)
|
|
|
|
5,413
|
|
Other current
liabilities
|
|
286
|
|
|
(6,562)
|
|
|
|
760
|
|
Other non-current
liabilities
|
|
631
|
|
|
1,716
|
|
|
|
1,116
|
|
Payment of severance
benefits
|
|
(2,316)
|
|
|
(4,579)
|
|
|
|
(5,754)
|
|
Other
|
|
(401)
|
|
|
(54)
|
|
|
|
516
|
|
Net cash provided by
operating activities
|
|
28,830
|
|
|
17,155
|
|
|
|
21,752
|
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
settlement of hedge collateral
|
|
2,385
|
|
|
4,627
|
|
|
|
4,863
|
|
Payment of hedge
collateral
|
|
(8,394)
|
|
|
(8,395)
|
|
|
|
(7,490)
|
|
Proceeds from disposal
of plant, property and equipment
|
|
202
|
|
|
202
|
|
|
|
13
|
|
Purchase of plant,
property and equipment
|
|
(3,793)
|
|
|
(15,000)
|
|
|
|
(11,432)
|
|
Payment for property
related to water treatment facility arrangement
|
|
—
|
|
|
—
|
|
|
|
(4,283)
|
|
Payment for
intellectual property registration
|
|
(410)
|
|
|
(642)
|
|
|
|
(574)
|
|
Collection of
guarantee deposits
|
|
90
|
|
|
388
|
|
|
|
659
|
|
Payment of guarantee
deposits
|
|
(438)
|
|
|
(1,330)
|
|
|
|
—
|
|
Other
|
|
—
|
|
|
(9)
|
|
|
|
(38)
|
|
Net cash used in
investing activities
|
|
(10,358)
|
|
|
(20,159)
|
|
|
|
(18,282)
|
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
|
|
Repurchase of
long-term borrowings
|
|
—
|
|
|
(1,175)
|
|
|
|
—
|
|
Proceeds from exercise
of stock options
|
|
101
|
|
|
149
|
|
|
|
435
|
|
Acquisition of
treasury stock
|
|
(235)
|
|
|
(2,588)
|
|
|
|
—
|
|
Proceeds from property
related to water treatment facility arrangement
|
|
—
|
|
|
—
|
|
|
|
4,283
|
|
Repayment of financing
related to water treatment facility arrangement
|
|
(138)
|
|
|
(281)
|
|
|
|
—
|
|
Repayment of principal
portion of lease liabilities
|
|
(59)
|
|
|
(118)
|
|
|
|
—
|
|
Net cash provided by
(used in) financing activities
|
|
(331)
|
|
|
(4,013)
|
|
|
|
4,718
|
|
Effect of exchange
rates on cash, cash equivalents and restricted cash
|
|
(200)
|
|
|
(1,668)
|
|
|
|
(5,081)
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
|
17,941
|
|
|
(8,685)
|
|
|
|
3,107
|
|
Cash,
cash equivalents and restricted
cash
|
|
|
|
|
|
|
|
|
|
|
Beginning of the
period
|
|
105,812
|
|
|
132,438
|
|
|
|
128,575
|
|
End of the
period
|
$
|
123,753
|
|
$
|
123,753
|
|
|
$
|
131,682
|
|
View original
content:http://www.prnewswire.com/news-releases/magnachip-reports-revenue-of-205-1-million-in-second-quarter-2019-oled-display-drivers-power-standard-products-set-revenue-records-300892910.html
SOURCE MagnaChip Semiconductor Corporation