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,

2013

March 31,

2013

June 30,

2012

Net income (loss)

$

4,436

$

(7,405)

$

4,340

Adjustments:

Depreciation and amortization

8,359

8,522

7,923

Interest expense, net      

5,879

5,849

5,619

Income tax expense (benefit)

(1,315)

1,662

3,159

Restructuring and impairment charges

—

2,446

—

Stock-based compensation expense

493

420

457

Foreign currency loss, net

20,978

22,558

10,586

Derivative valuation loss (gain), net

230

267

(701)

Secondary offering expense

—

669

1,216

Adjusted EBITDA

$

39,060

$

34,988

$

32,599

Adjusted EBITDA per common share:

- Diluted

$

1.05

$

0.94

$

0.87

Weighted average number of shares

- Diluted

37,125,005

37,138,414

37,566,699

Net income (loss)

$

4,436

$

(7,405)

$

4,340

Adjustments:

Restructuring and impairment charges

—

2,446

—

Stock-based compensation expense

493

420

457

Amortization of intangibles

1,492

1,749

1,980

Foreign currency loss, net

20,978

22,558

10,586

Derivative valuation loss (gain), net

230

267

(701)

Secondary offering expense

—

669

1,216

GAAP and cash tax expense difference

(1,452)

(998)

—

Adjusted net income

$

26,177

$

19,706

$

17,878

Adjusted net income per common share:

- Diluted

$

0.71

$

0.53

$

0.48

Weighted average number of shares - Diluted

37,125,005

37,138,414

37,566,699