Imagination Technologies Group Regulatory News (IMG)

19 Mar 2008 07:00

Imagination Technologies Group PLC19 March 2008 19 March 2008 Imagination Technologies Group plc Interim Management Statement Imagination Technologies Group plc ('Imagination', LSE:IMG), a leading providerof System-on-Chip (SoC) Intellectual Property (IP) is today issuing its InterimManagement Statement for the period from 1 October 2007 to 18 March 2008. Imagination has made continued progress in both its Technology business and inits PURE Digital business. With respect to the Technology business, despite a softer semiconductor marketenvironment, strong interest in our technologies from both existing and newpartners is continuing. This demand, driven by the strong market relevance ofour offerings, has been a feature of our business in recent years and resultedin a number of major strategic agreements closing during the first-half of thecurrent financial year. Further to these we recently announced a new licensedeal with NEC and currently have a significant number of major licenseagreements at advanced contract stages. We expect a number of these to closeprior to the end of our financial year on 30 April 2008*. The design activities of our partners have led to a significant number of newSoCs being committed since the first half of the financial year; the total ofcommitted SoCs now standing at 64 compared to 58 at the end of September 2007.These SoC design wins, which include many with tier one semiconductor companies,are a key measure of our fundamental progress and are the main driver behind ourfuture royalty revenue growth. Several SoCs incorporating our IP have been publicly announced since Septemberincluding TI's new OMAP 3440 and OMAP 3500 family (3515 and 3530), NEC'sNaviEngine 1, Marvell's PXA310, and SiRFprima from SiRF. In addition, thestrategic partnership with Intel in the UMPC (Ultra Mobile PC) and MID (MobileInternet Device) segments should lead to important product announcements shortlyand initial shipments starting around the end of the current financial year. Partner SoC volumes have continued to gain momentum with over 35m units shippedwith our technology during the first nine months of this financial year to theend of December, up from the 19.1m we reported for the first six months of thefinancial year to 30 September 2007. The signs so far suggest that the volumefor the final four months of the financial year* should take our full-yearshipment numbers to around 50m units, up from 25.7m units in the year to 31March 2007. These shipments are across a number of key markets including mobile phone, PMP,digital radio, and in-car navigation, with other segments developing too. In thesecond half to date, we have also seen growth in the volume of some lower-enddevices which usually attract a lower per unit royalty. Over time, with theincreasing number of SoCs with our newer generation technologies and/or highercontent of Imagination IP coming to market, we see the mix migrating moretowards higher-value as well as higher-end devices. Whilst we have made good progress during the first nine months of the year inthe key aspects of our Technology business, it is possible for the worseningglobal macro economic environment to have some impact on our progress towardsthe end of the financial year. However, despite any potential short-termslow-down, based on the continued strong growth in our partner SoC design winsand our active pipeline of licensing opportunities, we are confident in ouron-going progress in securing further key design wins for our IP and inachieving the target of 200m annual unit volume shipment by our partners byaround 2010. For the PURE Digital business, the product offerings and retailer ranging were,as previously reported, firmly in place for the important Christmas period andthis led to strong sales figures during the quarter ending December 2007 in linewith our expectation. PURE Digital retained its position as the number onesupplier of digital radios, marginally growing its market share during thisimportant period. Recently launched products including the automotive digitalradio, Highway, and the iPod-enabled Chronos iDock have been well received andhave taken leading positions in the market. Overall for the first nine months of the financial year the PURE Digitalbusiness has generally performed in line with our plans. Since January 2008,consistent with the general slow down in the retail market, we have seen adegree of softening of retail sales. However, given the strong contribution fromthe Christmas period's sales, the overall impact will be limited for the currentfinancial year. In line with our on-going strategy, PURE Digital has an extensive roadmap thatis designed to strengthen its position in its existing markets and furtherdevelop the emerging geographical opportunities. These include DAB+ anddeployment of new connected audio technologies and products to fully drive andexploit internet and streaming audio opportunities in the UK and other markets.We expect this to allow PURE to maintain its momentum in its markets. ENQUIRIES: Imagination Technologies Group plc Tel: 01923 260 511Hossein Yassaie, CEOTrevor Selby, CFO College Hill Tel: 020 7457 2020Adrian Duffield/Ben Way *As previously announced the current financial year has been extended to 13months; running from 1 April 2007 to 30 April 2008. About Imagination Technologies Imagination Technologies Group plc is an international leader in the creationand licensing of semiconductor System-on-Chip Intellectual Property (SoC IP) andin the development and manufacture of DAB digital radios. The Group isheadquartered in the United Kingdom, with sales and R&D offices worldwide. Imagination's Technology Division (www.imgtec.com) creates market-leadingembedded graphics, video and display acceleration, multi-threaded processing andmulti-standard receiver technologies, complemented by dynamic and extensivedeveloper support programmes. These SoC IP products are licensed to a wide rangeof semiconductor and consumer electronics companies around the world and arebeing used in the following markets: digital radio and audio; mobile phonemultimedia; car navigation & driver information; personal navigation; ultramobile PC (UMPC) and mobile internet device (MID); digital TV & set top box; andmobile TV. Imagination's PURE Digital Division (www.pure.com) was established to developconsumer products to showcase the capabilities of Imagination's SoC IP. As afully integrated part of the Group, PURE has become the creator and manufacturerof the world's most popular DAB digital radios and is the number one supplier ofradios in the UK. This information is provided by RNS The company news service from the London Stock Exchange