IQE PLC Iqe Plc: H2 2020 Trading Update

 
TIDMIQE 
 
 
   IQE plc 
 
   ("IQE" or the "Group") 
 
   Trading Update 
 
   Cardiff, UK 
 
   24 November 2020 
 
   IQE plc (AIM: IQE) the leading supplier of advanced wafer products and 
material solutions to the semiconductor industry, provides a trading 
update for the financial year ending 31 December 2020. 
 
   Trading Update 
 
   After a record H1 2020 revenue performance, trading in the second half 
of the year has continued with positive momentum in both the Wireless 
and Photonics business units. 
 
   This has been evidenced by IQE receiving its largest Military & Defence 
sector purchase order to date from a major US customer, for both 
infrared and high-performance RF applications. With a combined value of 
more than US$10 million, the order will be deliverable over the next 
nine months. 
 
   Wireless Business Unit 
 
   Strong year-on-year growth in 2020 for the Wireless Business Unit has 
been driven by: 
 
 
   -- Demand for GaAs wafers for 5G handset power amplifiers fuelled by growing 
      end market demand for '5G ready' smartphones; 
 
   -- Sales of GaN on SiC wafers for 5G infrastructure related to initial 
      deployments of 5G base stations; and 
 
   -- Sales of high-performance GaN on SiC wafers for Military RF applications. 
 
 
   Photonics Business Unit 
 
   Strong year-on-year growth in 2020 for the Photonics Business Unit has 
been driven by: 
 
 
   -- Consistently high demand for GaAs VCSEL wafers for 3D sensing 
      applications. IQE retains a market-leading position in 3D Sensing epitaxy 
      and has been central to new applications being launched for this 
      technology in its existing supply chains; 
 
   -- Sales of high-performance GaSb wafers for Military & Defence infrared 
      applications. 
 
 
   Full Year Outlook 
 
   IQE expects FY 2020 revenues to be at least GBP170m, exceeding the 
previous guidance of at least GBP165m, which was provided at the Interim 
Results on 8 September 2020. This equates to full year revenue growth of 
over 20%. 
 
   The Group anticipates delivering a mid-single-digit GBPm adjusted 
operating profit for FY20. 
 
   With a reduction in capital expenditure in FY20, along with a positive 
trading position and continued focus on cost control, net debt is 
anticipated to be low-single-digit GBPm. This represents a significant 
strengthening in the Group's balance sheet position since the prior year 
end balance of GBP16m net debt. 
 
   The Group anticipates that underlying demand for the technologies that 
IQE's products enable will remain strong heading into 2021. In 
particular, the Group expects demand for 5G-related products, both 
handset and infrastructure, will continue to grow over the next few 
years as the mega-replacement cycle of 5G deployments gathers pace 
around the world. In addition, IQE has a leading portfolio of Photonics 
products, for 3D Sensing and other applications, which makes the Group 
well-positioned for growth. 
 
   Dr Drew Nelson, Chief Executive Officer of IQE, said 
 
   "We are delighted to be reporting such a strong all-round financial 
performance, with anticipated revenue growth of over 20% for the full 
year, despite the ongoing uncertainty in the external environment. I am 
exceptionally proud of the whole IQE team whose dedication and 
commitment has enabled us to operate without interruption throughout 
this period." 
 
   Contacts: 
 
   IQE plc 
 
   [phone] 
 
   Drew Nelson 
 
   Tim Pullen 
 
   Amy Barlow 
 
 
 
   Peel Hunt LLP (Nomad and Joint Broker) 
 
   [phone] 
 
   Edward Knight 
 
   Paul Gillam 
 
   Nick Prowting 
 
 
 
   Citigroup Global Markets Limited (Joint Broker) 
 
   [phone] 
 
   Christopher Wren 
 
   Peter Catterall 
 
   Headland Consultancy (Financial PR) 
 
   + 44 (0) 20 38054822 
 
   Andy Rivett-Carnac: [phone] 
 
   Chloe Francklin: [phone] 
 
   This announcement contains inside information for the purposes of 
Article 7 of Regulation (EU) No 596/ 2014. For the purposes of MAR and 
Article 2 of Commission Implementing Regulation (EU) 2016/1055, this 
announcement is being made on behalf of IQE by Tim Pullen, Chief 
Financial Officer of IQE. 
 
   GLOSSARY 
 
   GaAs   Gallium Arsenide 
 
   GaN    Gallium Nitride 
 
   SiC      Silicon Carbide 
 
   VCSEL            Vertical Cavity Surface Emitting Laser 
 
   ABOUT IQE 
 
   https://www.globenewswire.com/Tracker?data=RvOaCqRS15V81Mcwgyv-vovj5W0cROAPstqRfCYNt51JOWvhNEVfJwYj_nfDNsI8d86dbKzXLk8B0PbjJnGkAYpSe3Mo-gnni77a4M838zxQ9GiXbRw73Ibi9sEDokqGfUWi3JkrfikVJ4QA-5Nd3NCQsZqz23Udazwt6G2IhnY8nOp46YtB0gr1V6rMRy3I8R3t-siM4ZvepGykNoFONrRaPYCW9fkYpJi7VG270rc= 
http://iqep.com 
 
   IQE is the leading global supplier of advanced compound semiconductor 
wafers and materials solutions that enable a diverse range of 
applications across: 
 
 
   -- handset devices 
 
   -- global telecoms infrastructure 
 
   -- connected devices 
 
   -- 3D Sensing 
 
 
   As a scaled global epitaxy wafer manufacturer, IQE is uniquely 
positioned in this market which has high barriers to entry. IQE supplies 
the whole market and is agnostic to the winners and losers at chip and 
OEM level. By leveraging the Group's intellectual property portfolio 
including know-how and patents, it produces epitaxy wafers of superior 
quality, yield and unit economics. 
 
   IQE is headquartered in Cardiff UK, with c. 650 employees across nine 
manufacturing locations in the UK, US, Taiwan and Singapore, and is 
listed on the AIM Stock Exchange in London. 
 
 
 
 

(END) Dow Jones Newswires

November 24, 2020 02:00 ET (07:00 GMT)

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