This leading global supplier of advanced semiconductor wafer products and services to the semiconductor industry,
provides a trading update for the year ended 31 December 2009.
The Group experienced a strong second half recovery following the industry-wide
destocking that adversely impacted the first six months of 2009. As a result,
IQE expects to report full year 2009 results in line with market expectations,
despite the adverse currency impact of sterling strengthening against the US
Dollar in the second half.
Second half revenues are expected to be 45% higher than first half. With the
benefit of high operational gearing and stringent cost controls, [IQE] expects to
report more than a threefold increase in second half EBITDA from £1.9m in the
first half, to deliver a full year EBITDA of approximately £8m.
As a result of stronger than expected wireless product sales and increasing demand for optoelectronic and silicon-based wafers, the Board expects first-half performance to be significantly ahead of market expectations.
The Group expects to report first-half revenues of at least £32.8 million, EBITDA above £5.3 million and retained profit of more than £2 million. Compared with the first half of 2009, this represents revenue growth of over 50% with EBITDA up over 178%, illustrating the Group's powerful operational leverage.
First-half growth was driven by good recovery in the wireless market with particularly strong demand for smartphones. The Group achieved higher than expected sales in the normally weak first quarter with demand accelerating in Q2 and looking robust for the remainder of the year.
Demand increased strongly for optoelectronic products, in particular IQE's world-leading Vertical Cavity Surface Emitting Laser (VCSEL) technology, which the Board believes will soon play a key enabling role in a number of high volume consumer applications. Notable applications of VCSEL technology include finger navigation, optical heating, internal interconnectors and external optical connectors such as Active Optical Cables and Intel's Light Peak technology, which will provide data transfer speeds 10-200 times faster than existing connectors such as USB cables.
In addition, demand continues to grow strongly for wafers to create energy-efficient products such as Concentrator PhotoVoltaics based on compound semiconductors and light emitting devices based on Gallium Nitride, with notable milestones achieved in bringing both these products to mass markets.
First-half performance was also boosted by a return to growth for the Group's silicon-based epitaxy services for high-performance electronic products, with a high level of interest in new products such as germanium on insulator (GeOI), launched in 2009, and Silicon on Sapphire (SOS).
The outlook for the second half remains positive with the Board expecting continued strength in sales volumes driven by increasing demand for smartphones and high-speed wireless technology, as well as for consumer optoelectronic devices. Demand-driven growth is being reinforced by an increasing trend towards outsourcing across all the market sectors in which the Group operates.
An excellent set of numbers and a bright and profitable future.
Half year results for the six months to 30 June 2011
Revenues up 16% to £38.3m (H1 2010: £33.0m)
Constant currency revenue growth of 23% - wireless sales up 21% and optoelectronic sales up 32% (organic 16%)
EBITDA up 13% to £6.1m (H1 2010: £5.4m)
Pre-tax profit up 28% to £2.8m (H1 2010: £2.2m)
Adjusted EPS* up 18% to 0.71 pence (H1 2010: 0.60 pence)
EPS up 20% to 0.60 pence (H1 2010: 0.50 pence)
Strong cash conversion from operations £5.9m (H1 2010: £1.9m)
Ungeared balance sheet, net funds £1.0m (Dec 2010: £7.0m)
Continued strong sales performance in key markets: wireless up 14% and optoelectronics up 25%
Wireless growth driven by continued strong adoption of smartphone and other mobile computing devices
IQE's products in majority of top-tier smartphones: broad customer base and growing market share (over 30%)
Engaged in over 20 new significant product qualifications
Over 100% growth in Gallium Nitride based high power RF business
Significant growth in opto-electronics:
Significant organic growth driven by emerging technologies, including CPV solar, infrared materials and VCSELs for finger navigation and optical interconnects.
Infrared materials growth supported by 2010 acquisition of US based Galaxy semiconductors.
Several patent applications across broad technology range submitted
Continued investment in further production capacity to address growing demand in 2012 and beyond.
year ended 31 December 2011.
Revenues up 4% to £75.3m (2010: £72.7m) despite H2 inventory correction
Continued improvement in gross margins, up from 22.8% to 24.1%
EBITDA up 6% to £14.0m (2010: £13.1m)
Pre-tax profit up 9% to £6.9m (2010: £6.3m)
Retained profit up 12% to £8.4m (2010: £7.5m)
Adjusted EPS of 1.86p (2010: 1.91p); basic EPS of 1.62p (2010: 1.63p)
Capital expenditure of £17.4m (2010 £5.6m) reflects capacity expansion to meet anticipated sales growth
Cash generated from operations of £10.8m (2010: £10.3m)
Net debt of £3.9m (2010: Net funds £7.0m)
Excellent progress on qualification programmes to underpin continued revenue growth across broad customer base
Capacity expansion progressing well providing customers with confidence over our ability to satisfy their increasing demand and surge requirements
LOL,sure the big boys are gonna let the conservationists take their dreams away !
This stock I believe to be in a similar state ti [IQE] when it first went on "Hotties" before the share price meteoric rise now [PINN] is a Hottie Hottie
With a bigger turnover allegedly than facebook and a greater potential profitability.
DEO welcomes the HM Treasury ("HMT") statement in respect of the package of changes to field allowances for companies operating in the UK and UK Continental Shelf. The changes designed to increase investment and production in the North Sea are anticipated to directly impact DEO, in particular the new small field allowance against the current Supplementary Charge rate of 32%. DEO estimates that its Perth Field Phase 1 recoverable resources will now be below the new and increased minimum threshold set by HMT of approximately 45 million boe, and therefore anticipates that it will benefit from the full amount of its 52.03% share of the increased field allowance of £150 million. This will reduce DEO's tax payable by approximately £25 million over the life of the field, improving project economics. David Marshall, DEO Chief Executive Officer Comments: "This is more encouraging news from the HM Treasury that will directly affect DEO, and is an encouraging demonstration of the Government's commitment to attracting oil and gas investment in the North Sea."
is in advanced discussions regarding a potential significant acquisition.
IQE is evaluating the financing options, which include debt finance and equity finance. The pricing, sizing and terms of any equity financing will be subject to market conditions and demand.
There can be no certainty that any transaction will occur, or its terms and conditions.
Has recently received an interim dividend of £10,000,000 from Lancaster Gate (Hyde Park) Ltd, our joint venture with Minerva. This is the fifth interim dividend from this development project and brings the total received to date to £37.7m.
All but one of the apartments in the Lancasters development have now been sold and it is our current estimate that our total profit share (net of corporation tax) is likely to be in the region of £49.8m. As noted above, we have received £37.7m to date in dividends from this project, and therefore we estimate that a further £12.1m will be forthcoming.
[IQE]For the six months ended 30 June 2013.
The Board expects first-half performance to be ahead of market expectations, with first-half revenues approaching £63 million, EBITDA in excess of £10 million and net debt below £39m. This represents revenue growth of over 80%, and EBITDA growth of over 150% compared with the first half of 2012. Sales growth was primarily driven by the wireless division, which included contributions from the RFMD and Kopin acquisitions.
The wireless market has continued to grow in line with expectations, driven by the increasing adoption of more sophisticated communication devices including 4G and LTE smartphones and tablets, and newly launched dual band wifi (802,11ac). These advanced products demand the highest levels of RF performance which can only be delivered by compound semiconductor enabled front end solutions.
The integration of the RFMD and Kopin acquisitions has been successfully completed as planned. Work to realise the projected synergies is progressing well. The Board will provide a full update on this progress with the Group's half year results.
The photonics business is also making good progress with several applications in transition from research and development into production. Notably, these include a number of advanced laser (VCSEL) products for consumer, industrial and medical applications such as: optical communications devices for short range optical links; data centres and broadband delivery; optical devices for gesture recognition; gaming and cosmetic applications; and lasers for projection, medical and defence applications.
Advanced solar (CPV) technology acquired through the investment in Solar Junction and the exclusive seven year license agreement, is now in the final stages of qualification. The Group remains on track for this business to achieve end customer qualification and move into volume production during H2 2013.
The development of advanced products including gallium nitride materials and the Group's compound semiconductors on silicon projects are progressing well. They are building a platform for further diversified growth in the rapidly growing markets for energy efficient devices, such as LEDs and power semiconductors over the next few years.
The Board is confident that the Group remains on track to achieve market expectations for the full year.
Dr Drew Nelson, Chief Executive of IQE, said:
"Our key markets have continued to demonstrate robust growth, driven predominantly by high levels of demand for 4G and LTE enabled smartphone and tablet products, along with accelerating requirements for photonic products and advanced sensor applications. Additionally, requirements for energy-efficient third-generation CPV solar products, Solid State Lighting (SSL) and power efficient GaN devices, continue to increase strongly.
"Our transactions with Solar Junction, RF Micro Devices and Kopin, over the last 18 months, represent significant milestones in the execution of our overall strategy and have significantly enhanced both our short and long term growth potential.
"They are highly complementary, extending our critical mass and global leadership in wireless, and bringing additional capacity to service the emerging high growth CPV market.
"Compound semiconductors are widely acknowledged as the key enabling materials that will drive a wide range of next generation technologies from high performance data transmission and management, to highly energy efficient products, including solar energy, SSL and power semiconductors."
IQE expects to report its interim results around mid-September 2013.
Opinion: Strong Buy
On the move.Today 15:501.8m shares traded so far today, 75% of which are Buys. This is on the move again!!!
[IQE] is to play a key part in a consortium of high tech businesses and academia in a major Clean Energy Initiative announced yesterday in North Carolina by the U.S. President.
President Obama announced the formation of the Clean Energy Manufacturing Innovation Institute during a visit to North Carolina State University on Wednesday 15th January. The establishment of the institute will be led by North Carolina State University and industry partners include ABB, APEI, Avogy, Cree, Delphi, Delta Products, DfR Solutions, Gridbridge, Hesse Mechantronics, II-VI, IQE, John Deere, Monolith Semiconductor, RF Micro Devices, Toshiba International, Transphorm, USCi, and Vacon.
The formation of the Institute is part of the U.S. Government's National Network for Manufacturing Innovation Initiatives (NNMI) announced by The White House in February 2013 to bolster the competitiveness of U.S. manufacturing.
IQE has been selected as supplier of epitaxial materials to the consortium for the development of a 150mm GaN-on-Si power electronics capability for high voltage (600V to 1200V) applications, an award which is worth up to $4M over the next five years. GaN-on-Silicon is a key materials technology not only for highly efficient power semiconductors with applications ranging from everyday power supplies for consumer electronics to industrial motor controls and hybrid-electric vehicles, but also for RF applications in next generation base station and small cell RF communication networks, as well as highly cost efficient LEDs, high speed rail and other power efficient applications.
Gallium nitride has been a key materials technology initiative for IQE over the last few years, building on the acquisition of NanoGaN in 2010, Kopin Wireless in 2013, and the successful development and deployment of GaN on SiC technology for high power RF applications, culminating in the launch of the world's first 150mm GaN-on-SiC wafer products in 2013.
Commenting on the announcement, IQE CEO and President, Dr. Drew Nelson said:
"Yesterday's announcement is a great endorsement of IQE's recognition as a global leader in advanced semiconductor products and highlights the importance of materials such as gallium nitride (GaN) as a key enabling technology for the future.
IQE has built a diversified portfolio of advanced compound semiconductor products which are now beginning to impact many aspects of today's and tomorrow's advanced technologies targeting wireless communications, opto electronics, InfraRed and Xray detection, clean energy generation (CPV), power efficient devices and next generation CMOS.
Compound semiconductors offer limitless access and solutions to next generation societal challenges, and IQE is positioned as the global leader in the commercialisation of these new technologies."
[IQE] revenue for full year 2013 is expected to be at least £126.0m (2012: £88.0m), representing a new record and an increase of over 43% compared with the prior year. Strong sales growth and improved operational efficiencies are expected to deliver a record EBITDA of at least £24.5m (2012: £16.4m). Adjusted fully diluted EPS is therefore expected to be approximately 2p (2012: 1.51p), an increase of over 32% compared with 2012.
The Group's high conversion of operating profit into cash is expected to reduce net debt to below £35.0m at year end (June 2013: £37.7m), even after the payment of approximately £14.0m during 2013 in deferred consideration relating to prior acquisitions. The amount of deferred consideration payable in 2014 is expected to reduce from this level.
Towards the end of 2013, in addition to successfully renewing its existing contractual relationships with key wireless customers, IQE also extended its contractual share of future business. As anticipated, the group continues to diversify its business across non-wireless applications.
In particular, the Group demonstrated:
strong progress in photonics (VCSELs) through a major contractual agreement with Philips, announced in October 2013;
continuing qualifications and technical progress on CPV, where a powerful supply chain has been established and is being fully qualified;
continued growth in infrared products; and
excellent progress on power and LED materials employing gallium nitride (GaN) on Silicon (Si) technology.
In addition, since year-end IQE's powerful position in GaN on Si has been further endorsed by its inclusion in a significant US energy initiative announced on 15 January 2014 by US President Obama.
The Board remains confident that the Group can continue to deliver increased free cash flow over the coming year and beyond, as the business continues to diversify, and cost synergies from recent acquisitions are realised.
Dr Drew Nelson, CEO and President of IQE plc, said:
"I am very pleased to announce that we expect to report a record level of revenue and earnings for 2013 as a result of IQE's increasingly strong position within the Compound Semiconductor Industry, and our rapidly strengthening product portfolio. As a result of strong cash flows we have also successfully reduced net debt and the deferred consideration owing on prior acquisitions.
"We look forward to further increasing cash flows and earnings during the current year and beyond as we maintain our strong position in wireless and continue to leverage opportunities to exploit our products in other high-growth markets."
IQE certainly is looking good!
[IQE] Has received its first $1 million purchase order agreement for InSb substrates which are used in advanced mid-wave infrared imaging technology.
IQE Infrared's US substrate division, Galaxy Compound Semiconductor Inc., has been contracted to deliver volume quantities of InSb substrates to an industry leader and long term customer of the Group. This represents the largest order to date for this new range of Infrared substrates.
InSb is the material of choice for mid-wavelength infrared (MWIR) imaging technology and cameras fabricated from InSb are used in a wide variety of advanced imaging applications (defence, security, medical and industrial). IQE infrared is uniquely positioned in this market and is the exclusive supplier of all InSb to industry, with IQE's US (Galaxy) and UK (Wafer Technology) operations collectively meeting the requirements of its customers to provide a secure, dual source supply of InSb substrates.
Dr Drew Nelson, CEO of IQE plc, commented:
"We are very pleased to receive this order from a long term customer of our InSb substrate product range. The scale of this commitment reflects our success in being able to offer a volume manufacturing capability for InSb materials. The investments that we have made to enhance our crystal growth, wafering and substrate polishing capabilities at both Galaxy and Wafer Technology will enable us to fully meet the InSb product demands of our customers, both in terms of volume and quality, across a full 2"-6" product range."