MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of US dollars)

(Unaudited)

Three Months

Ended

Six Months

Ended

June 30,

2018

June 30,

2018

June 30,

2017

Cash flows from operating activities

Net income (loss)

$

(21,505)

$

(18,742)

$

35,679

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

Depreciation and amortization

8,012

15,970

13,531

Provision for severance benefits

4,653

9,165

10,776

Amortization of debt issuance costs and original issue discount

541

1,073

950

Loss (gain) on foreign currency, net

34,051

32,369

(35,813)

Restructuring gain and other

—

—

(17,010)

Stock-based compensation

1,341

2,810

1,179

Other

1,390

1,053

220

Changes in operating assets and liabilities

Accounts receivable, net

2,190

5,305

(9,730)

Unbilled accounts receivable

1,526

887

—

Inventories, net

(3,647)

(16,797)

2,646

Other receivables

(762)

(4,508)

2,598

Other current assets

3,288

2,253

1,135

Accounts payable

(7,641)

(4,473)

(1,919)

Other accounts payable

(2,470)

(5,229)

(7,790)

Accrued expenses

5,694

(1,435)

(10,776)

Other current liabilities

1,330

760

(436)

Deferred revenue

604

5,413

(265)

Other non-current liabilities

498

1,116

(268)

Payment of severance benefits

(3,507)

(5,754)

(18,082)

Other

87

516

(107)

Net cash provided by (used in) operating activities

25,673

21,752

(33,482)

Cash flows from investing activities

Proceeds from disposal of plant, property and equipment

13

13

1,125

Purchase of plant, property and equipment

(4,103)

(11,432)

(10,807)

Payment for property related to water treatment facility arrangement

(4,283)

(4,283)

—

Payment for intellectual property registration

(165)

(574)

(566)

Proceeds from settlement of hedge collateral

—

4,863

6,781

Payment of hedge collateral

(7,490)

(7,490)

(10,036)

Collection of guarantee deposits

645

659

1,400

Payment of guarantee deposits

—

—

(41)

Other

(2)

(38)

22

Net cash used in investing activities

(15,385)

(18,282)

(12,122)

Cash flows from financing activities

Proceeds from issuance of senior notes

—

—

86,250

Payment of debt issuance costs

—

—

(5,902)

Proceeds from exercise of stock options

293

435

2,525

Acquisition of treasury stock

—

—

(11,401)

Proceeds from property related to water treatment facility arrangement

4,283

4,283

—

Net cash provided by financing activities

4,576

4,718

71,472

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

(6,318)

(5,081)

4,049

Net increase in cash, cash equivalents and restricted cash

8,546

3,107

29,917

Cash, cash equivalents and restricted cash

Beginning of the period

123,136

128,575

101,606

End of the period

$

131,682

$

131,682

$

131,523