Can anyone explain King Thranduil's burn in the 2nd Hobbit movie?

Rewatching the 2nd movie and I don't think it was explained in the book. In fact I think he was initially only titled "the Elven King" or something, and not given a name.

Anyway, if you recall when the elves capture the dwarves and Thranduil talks to Thorin he talks about facing dragons in the past and half of his face appears burned for a second.

Just a question for those who know the Tolkien folklore more. Is there any reference to what he was saying about facing dragons? And was he wounded? Throughout the book Tolkien does indicate that pretty much all races have some level of magical ability so would this have been some magical illusion to make a point?

... or was it just Jackson's way of making a point via special effect?