- Revenue of $188 Million up Sequentially and Year-over-Year
- Power Solutions Revenue Grew 126% over Q1 2010
- Net Income $22 Million or $0.57 per diluted share

SEOUL, South Korea and CUPERTINO, Calif., April 27, 2011 /PRNewswire via COMTEX/ --

MagnaChip Semiconductor Corporation (NYSE: MX) today announced financial results for the first quarter ended March 31, 2011.

Revenue for the first quarter of 2011 was $187.9 million, a 4.7% increase compared to $179.5 million for the first quarter of 2010, and a 0.6% increase compared to $186.8 million for the fourth quarter of 2010.

Gross profit was $56.5 million or 30.1%, as a percent of revenue, for the first quarter of 2011. This compares to gross profit of $49.4 million or 27.5% for the first quarter of 2010 and $60.4 million or 32.3% for the fourth quarter of 2010.

"I am very pleased with our performance in what is typically a seasonally down quarter for MagnaChip and the industry," said Sang Park, MagnaChip's Chairman and Chief Executive Officer. "Our Power Solutions business segment grew 11 percent sequentially and more than doubled over the same period last year. Our foundry business was down less than expected for this seasonally weaker quarter and our Display Solutions segment was up for the quarter. All indications point to 2011 being another solid year for growth in revenue and margin expansion for MagnaChip."

Net income, on a GAAP basis, for the first quarter of 2011 totaled $22.5 million or $0.57 per diluted share. This compares to net income of $31.1 million or $0.81 per diluted share for the first quarter of 2010 and net income of $12.3 million or $0.31 per diluted share for the fourth quarter of 2010.

Adjusted net income, a non-GAAP measurement, for the first quarter of 2011 totaled $15.7 million or $0.40 per diluted share compared to $19.9 million or $0.52 per diluted share for the first quarter of 2010 and $17.4 million or $0.44 per diluted share for the fourth quarter of 2010.

Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a more meaningful understanding of the factors and trends affecting MagnaChip Semiconductor Corporation's business and operations. 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.

Combined cash balances (cash and cash equivalents plus short-term investments) totaled $194.2 million at the end of the first quarter of 2011, an increase of $22.0 million from the end of the prior quarter. Cash provided from operations totaled approximately $19.2 million for the first quarter of 2011.

Revenue by Segment
In thousands of US dollars	Three Months Ended
	March 31, 2011	December 31, 2010	March 31, 2010
Semiconductor Manufacturing Services	$ 92,266	$ 97,261	$ 93,201
Display Solutions	74,464	70,581	76,730
Power Solutions	20,412	18,398	9,034
Other	779	532	520
Total Revenue	$ 187,921	$ 186,772	$ 179,485

First Quarter and Recent Company Highlights

• Successfully completed our initial public offering and listing on the New York Stock Exchange on March 11, 2011.
• Signed a wafer foundry agreement with a major US provider of microcontroller and touch solutions.
• Launched a US-based power solutions design center in Cupertino, California, to expand our technology offerings.
• Introduced a cost-competitive copper wire bonding solution for foundry customers.

Business Outlook

For the second quarter of 2011, the company expects:

• Revenue to increase 5% to 9% on a sequential basis.
• Gross profit, as a percent of revenue, to increase 1.5% to 3.0% quarter-over-quarter.

Non-GAAP Metrics

Adjusted EBITDA excludes charges related to depreciation and amortization, interest expense, income tax expense (benefit), restructuring and impairment activities, inventory step-up, equity-based compensation, foreign currency (gain) loss, derivative valuation (gain) loss and special expense for the IPO employee incentive payment. Adjusted net income (loss) excludes charges related to restructuring and impairment, inventory step-up, equity-based compensation, amortization of intangible assets associated with continuing operations, foreign currency (gain) loss, derivative valuation (gain) loss and special expense for the IPO employee incentive payment. A reconciliation of GAAP results to non-GAAP results is included following the financial statements below.

About MagnaChip Semiconductor Corporation

Headquartered in South Korea, MagnaChip Semiconductor Corporation is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for high-volume consumer applications. MagnaChip Semiconductor believes it has one of the broadest and deepest ranges of analog and mixed-signal semiconductor platforms in the industry, supported by its 30-year operating history, a large portfolio of registered and pending patents, and extensive engineering and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip Semiconductor'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 Semiconductor Corporation'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 ability to capitalize on improving market dynamics and future operating and financial performance including second quarter 2011 revenue and gross profit. All forward-looking statements included in this release are based upon information available to MagnaChip Semiconductor 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 Semiconductor Corporation's filings with the SEC, including our Form 10-K filed on March 18, 2011 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 Semiconductor Corporation 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: Robert Pursel Director of Investor Relations Tel. 408-625-1262 robert.pursel@magnachip.com	In Korea: Chankeun Park Senior Manager, Public Relations Tel.+82-3-6903-3195 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
		March31, 2011			December 31, 2010			March 31, 2010
Net sales	$	187,921		$	186,772			$	179,485
Cost of sales		131,447			126,421				130,127
Gross profit		56,474			60,351				49,358
Gross profit %		30.1%			32.3%				27.5%
Selling, general and administrative expenses		15,401			16,566				17,908
Research and development expenses		18,498			19,331				20,531
Restructuring and impairment charges		-			958				336
Special expense for IPO incentive		12,146			-				-
Operating income		10,429			23,496				10,583
Other income (expense)
Interest expense, net		(7,111)			(6,981)				(2,049)
Foreign currency gain (loss), net		21,359			(19)				21,616
Other		166			(16)				(52)
		14,414			(7,016)				19,515
Income before income taxes		24,843			16,480				30,098
Income tax expense (benefits)		2,375			4,209				(1,003)
Net income	$	22,468		$	12,271			$	31,101
Earnings per common share :
- Basic	$	0.59		$	0.32			$	0.82
- Diluted	$	0.57		$	0.31			$	0.81
Weighted average number of shares - Basic		38,332,750			37,898,912				37,805,445
Weighted average number of shares - Diluted		39,570,522			39,269,465				38,441,991

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA AND ADJUSTED NETINCOME (In thousands of US dollars, except share data) (Unaudited)
	Three Months Ended
	March 31,			December 31,				March31,
	2011			2010				2010
Net income	$	22,468		$	12,271			$	31,101
Adjustments:
Depreciation and amortization		13,903			14,063				15,477
Interest expense, net		7,111			6,981				2,049
Income tax expense		2,375			4,209				(1,003)
Restructuring and impairment charges		-			958				336
Inventory step-up		-			-				867
Equity-based compensation expense		641			1,167				1,473
Foreign currency (gain) loss, net		(21,359)			19				(21,616)
Derivative valuation (gain) loss, net		(158)			16				57
Special expense for IPO incentive		12,146			-				-
Adjusted EBITDA	$	37,127		$	39,684			$	28,741
Adjusted EBITDA per common share:
- Basic	$	0.97			1.05				0.76
- Diluted	$	0.94			1.01				0.75
Net income	$	22,468		$	12,271			$	31,101
Adjustments:
Restructuring and impairment charges		-			958				336
Inventory step-up		-			-				867
Equity based compensation expense		641			1,167				1,473
Amortization of intangibles		1,990			2,937				7,697
Foreign currency (gain) loss, net		(21,359)			19				(21,616)
Derivative valuation (gain) loss, net		(158)			16				57
Special expense for IPO incentive		12,146			-				-
Adjusted net income	$	15,728		$	17,368			$	19,915
Adjusted net income per common share:
- Basic	$	0.41		$	0.46			$	0.53
- Diluted	$	0.40		$	0.44			$	0.52

We define Adjusted EBITDA as net income adjusted to exclude (i) depreciation and amortization (ii) interest expense, net, (iii) income tax expense, (iv) restructuring and impairment charges, (v) the increase in cost of sales resulting from the fresh-start accounting inventory step-up, (vi) equity-based compensation expense, (vii) foreign currency (gain) loss, net, (viii) derivative valuation (gain) loss, net and (ix) special expense for IPO incentive.

We present Adjusted Net Income as a further supplemental measure of our performance. We prepare Adjusted Net Income by adjusting net income 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 as net income adjusted to exclude (i) restructuring and impairment charges, (ii) the increase in cost of sales resulting from the fresh-start accounting inventory step-up, (iii) equity-based compensation expense, (iv) amortization of intangibles, (v) foreign currency gain (loss), net, (vi) derivative valuation gain (loss), net and (vii) special expense for IPO incentive.

MAGNACHIP SEMICONDUCTORCORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands of US dollars, except share data) (Unaudited)
		March31, 2011					December31, 2010
Assets
Current assets
Cash and cash equivalents		$	194,179				$	172,172
Accounts receivable, net			131,020					119,054
Inventories, net			73,879					68,435
Other receivables			4,006					2,919
Prepaid expenses			11,082					8,207
Other current assets			9,937					18,920
Total current assets			424,103					389,707
Property, plant and equipment, net			179,240					179,012
Intangible assets, net			26,154					27,538
Long-term prepaid expenses			7,456					8,235
Other non-current assets			21,357					21,252
Total assets		$	658,310				$	625,744
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable		$	74,040				$	58,264
Other accounts payable			10,869					14,645
Accrued expenses			43,710					32,635
Current portion of capital lease obligation			5,850					5,557
Other current liabilities			3,932					5,048
Total current liabilities			138,401					116,149
Long-term borrowings			246,952					246,882
Obligation under capital lease			1,665					3,105
Accrued severance benefits, net			91,503					87,778
Other non-current liabilities			7,902					8,979
Total liabilities			486,423					462,893
Commitments and contingencies
Stockholders' equity
Common stock, $0.01 par value, 150,000,000 shares authorized, 39,356,749 and 38,401,985shares issued and outstanding at March31, 2011 and December 31, 2010, respectively			394					384
Additional paid-in capital			97,812					95,585
Retained earnings			94,625					72,157
Accumulated other comprehensive loss			(20,944)					(5,275)
Total stockholders' equity			171,887					162,851
Total liabilities and stockholders' equity		$	658,310				$	625,744

MAGNACHIP SEMICONDUCTORCORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands of US dollars) (Unaudited)
	Three MonthsEnded
	March 31, 2011					March 31, 2010
Cash flows from operating activities
Net income	$	22,468				$	31,101
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		13,903					15,477
Provision for severance benefits		2,854					3,166
Amortization of debt issuance costs		246					25
Gain on foreign currency translation, net		(23,684)					(23,478)
Gain on disposal of property, plant and equipment, net		-					(9)
Losson disposal of intangible assets, net		4					2
Restructuring and impairment charges		-					336
Stock-based compensation		641					1,473
Cash used for reorganization items		-					1,579
Other		549					393
Changes in operating assets and liabilities
Accounts receivable		(9,250)					(29,684)
Inventories		(3,467)					7,206
Other receivables		(1,041)					(1,238)
Other current assets		(1,449)					(3,659)
Deferred tax assets		548					264
Accounts payable		14,289					18,088
Other accounts payable		(1,348)					(1,612)
Accrued expenses		7,153					3,196
Other current liabilities		(1,518)					(2,107)
Long term other payable		184					(2,136)
Payment of severance benefits		(1,610)					(1,092)
Other		(256)					(788)
Net cash provided by operating activities before reorganization items		19,216					16,503
Cash used for reorganization items		-					(1,579)
Net cash provided by operating activities		19,216					14,924
Cash flows from investing activities
Proceeds from disposal of plant, property and equipment		-					4
Purchase of plant, property and equipment		(6,779)					(891)
Payment for intellectual property registration		(165)					(152)
Decreasein short-term financial instruments		-					329
Collection ofguarantee deposits		979					972
Payment of guarantee deposits		(1,004)					(56)
Other		(44)					33
Net cash provided by (used in) investing activities		(7,013)					239
Cash flows from financing activities
Proceeds from issuance of common stock		11,425					-
Repayment of current portion of long-term debt		-					(154)
Repayment of obligation under capital lease		(1,562)
Net cash provided by (used in) financing activities		9,863					(154)
Effect of exchange rates on cash and cash equivalents		(59)					2,754
Net increase in cash and cash equivalents		22,007					17,763
Cash and cash equivalents
Beginning of the period		172,172					64,925
End of the period	$	194,179				$	82,688

SOURCE MagnaChip Semiconductor Corporation