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,

2016

Mar 31,

2016

June 30,

2015

Net income (loss)

$

(17,816)

$

8,125

$

(30,626)

Adjustments:

Interest expense, net

4,001

3,999

3,933

Income tax expenses (benefits)

272

815

(602)

Depreciation and amortization

6,228

6,024

6,797

EBITDA

$

(7,315)

$

18,963

$

(20,498)

Restructuring and other (gain), net

5,545

(6,832)

—

Equity-based compensation expense

968

536

1,792

Foreign currency loss (gain), net

7,101

(8,195)

12,296

Derivative valuation loss (gain), net

8

(42)

306

Restatement related expenses

2,306

3,592

5,168

Adjusted EBITDA

$

8,613

$

8,022

$

(936)

Net income (loss)

$

(17,816)

$

8,125

$

(30,626)

Adjustments:

Restructuring and other (gain), net

5,545

(6,832)

—

Equity-based compensation expense

968

536

1,792

Foreign currency loss (gain), net

7,101

(8,195)

12,296

Derivative valuation loss (gain), net

8

(42)

306

Restatement related expenses

2,306

3,592

5,168

Adjusted net loss

$

(1,888)

$

(2,816)

$

(11,064)

Adjusted net loss per common share:

- Basic / Diluted

$

(0.05)

$

(0.08)

$

(0.32)

Weighted average number of shares – Basic / Diluted

34,716,081

34,698,904

34,092,402