MagnaChip Semiconductor Corp. announced financial results for the third quarter ended September 30, 2011. Revenue for the third quarter of 2011 was $200.4 million, a 1.6% decrease compared to $203.7 million for the second quarter of 2011, and a 4.3% decrease compared to $209.4 million for the third quarter of 2010.
Gross profit was $60.1 million or 30.0%, as a percent of revenue, for the third quarter of 2011. This compares to gross profit of 66.2 million or 32.5 % for the second quarter of 2011 and $69.3 million or 33.1% for the third quarter of 2010.
"Despite continued weakness in the global semiconductor market, we managed to deliver results consistent with our original guidance while growing Power Solutions 11% sequentially and 48% year-over-year," said Sang Park, MagnaChip’s Chairman and Chief Executive Officer. "While many of our peers reduced their outlook as the quarter progressed, we delivered on our initial expectations based on the strength of our blue-chip customer relationships, diverse product portfolio and growing Power and Display Solutions businesses. Having a strategy that capitalizes on the strength of our Foundry, Display and Power products better positions us for growth as the macro environment begins its recovery."
Net loss, on a GAAP basis, for the third quarter of 2011 totaled $56.0 million or $1.43 per diluted share. This compares to net income of $31.6 million or $0.78 per diluted share for the second quarter of 2011 and a net income of $61.5 million or $1.57 per diluted share for the third quarter of 2010. Net loss was primarily impacted by a non-cash foreign currency translation loss of $68.1 million due to the appreciation of the US dollar against the Korean won associated with intercompany balances.
Adjusted net income, a non-GAAP measurement, for the third quarter of 2011 totaled $18.2 million or $0.46 per diluted share compared to $22.5 million or $0.56 per diluted share for the second quarter of 2011 and $26.2 million or $0.67 per diluted share for the third 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 restricted cash) totaled $168.7 million at the end of the third quarter of 2011, a decrease of $9.1 million from the end of the prior quarter primarily due to a cash payment of $12.1 million related to the $11.3 million repurchase of senior notes during the quarter. Cash provided from operations totaled approximately $18.7 million for the third quarter of 2011.
