IQE eyes yearly profit climb as starts strategic review

(Alliance News) - IQE PLC on Monday said it is confident in its long-term prospects due to its position in providing advanced compound semiconductors, as it launched a strategic review.

The Cardiff-based supplier of compound semiconductor wafer products and advanced material solutions said it expects revenue in 2024 to be broadly flat from 2023's GBP115.3 million.

Further, IQE anticipates adjusted earnings before interest, tax, depreciation and amortisation of at least GBP5 million, up 16% from GBP4.3 million in 2023.

Looking ahead, the company said: "The board remains confident in IQE's long-term prospects because of the group's leading position in providing advanced compound semiconductors across several market verticals and to a base of global marque customers. The board believes there is significant value in IQE that is not currently reflected in its market capitalisation."

IQE added it will start a strategic review of its asset base to ensure it has a "strong" capital position to further invest in its core operations.

Further, the company said it is in the process of negotiating a proposal from Lombard Odier, its largest shareholder, regarding short-term financing to help its navigate "the ongoing market softness".

Lombard Odier is willing to extend up to GBP15 million via a convertible loan note.

IQE Executive Chair Mark Cubit said: "The impact of the slow pace of recovery in the semiconductor industry can be seen across the sector and is reflected in our revenue expectations for FY24. Looking ahead, the strategic review, including the broader assessment of options for our Taiwan operations, will ensure we have a strong capital base to continue investing in our core business and support IQE's long-term strategy. We remain committed to delivering maximum value for our shareholders and serving our customers. We are confident in IQE's long-term prospects and inherent value."

IQE shares fell 3.8% to 10.28 pence each on Monday afternoon in London.

By Tom Budszus, Alliance News slot editor

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