News Article
Smartphone & Opto markets drive IQE profits up 28%
The firm saw the gallium nitride high power market grow by over 100% and optoelectronics sales went up 32% compared to the same 6 month period last year.
IQE, a global supplier of advanced wafer products and wafer services to the semiconductor industry, has announced its half year results for the six months ended 30 June 2011.
Revenues increased 16% from £33 million in H1 2010 to £38.3 million this year. Constant currency revenue growth was 23% with wireless sales up 21% and optoelectronic sales up 32% (organic 16%). EBITDA was up 13% to £6.1 million and pre-tax profit up 28% to £2.8 million compared to H1 2010.
Adjusted EPS was up 18% to 0.71 pence and EPS increased by 20% to 0.60 pence from the same period last year. Cash conversion from operations was a hefty £5.9 million and the ungeared balance sheet had net funds of £1.0 million compared to £7.0 million in Dec 2010.
The company saw continued strong sales performance in key markets with wireless up 14% and optoelectronics up 25%. Wireless growth was driven by continued strong adoption of smartphone and other mobile computing devices. The firm says its products are used in the majority of top-tier smartphones and has a broad customer base and growing market share, currently over 30%.
Engaged in over 20 new significant product qualifications, IQE also saw over 100% growth in the GaN based high power RF market and a significant growth in optoelectronics.
Significant organic growth was driven by emerging technologies, including CPV solar, infrared materials and VCSELs for finger navigation and optical interconnects. Infrared materials growth was supported by the 2010 acquisition of US based Galaxy semiconductors.
IQE has submitted several patent applications across a broad technology range and is continuing to invest in further production capacity to address growing demand in 2012 and beyond.
Drew Nelson, IQE Chief Executive, commented, “The continued growth in demand for our wireless products driven by strong global smartphone adoption, coupled with increased revenues from our optoelectronic wafers have enabled us to maintain our momentum in the first half of 2011 with a diversifying revenue stream. Our core wireless markets continue to grow rapidly whilst the new markets around energy efficiency and consumer communications are also developing well. “
“The end markets for our products continue to look attractive and offer sustainable high growth. Our overall upbeat outlook is tempered by recent growing uncertainty in the global economy. This has the potential to impact inventory levels downstream in the supply chain or of individual customers although we have not seen any evidence of this at this time. Given IQE’s strategic positioning, the Board remains confident of meeting current market expectations and of the Group’s exciting longer term growth prospects,” he concluded.
