IQE PLC Iqe Plc : Trading Statement
20 July 2016 - 7:00AM
UK Regulatory
TIDMIQE
IQE plc
Trading Statement
Significant growth in revenues and profits reflect increasing revenue
diversification
Cardiff, UK. 20(th) July 2016: IQE plc (AIM: IQE; "IQE", the "Group"),
the leading global supplier of advanced wafer products and wafer
services to the semiconductor industry, provides a trading statement for
the six months ended 30 June 2016.
The Group announces that it expects to deliver a significant increase in
revenues and profits for the first half of 2016, compared with the same
period in 2015 and continues to reduce its balance sheet leverage*.
Sales in the first half are expected to be at least 15% higher than H1
2015, with the business enjoying an increasing diversification of
revenues.
Photonics continues to grow rapidly, and is expected to deliver a double
digit rate of growth in the first half. It is widely accepted that the
Photonics market will continue its rapid growth over the coming years as
Vertical Cavity Lasers ("VCSEL") and Indium Phosphide Lasers ("InP") are
increasingly adopted for a wide range of end market applications. These
include consumer products, fibre optic communications, data centres and
industrial processes.
License income from joint ventures is expected to be c.GBP3.5m for the
half year, with both joint ventures making good progress.
Wireless and InfraRed sales are expected to show a slight year on year
increase.
The depreciation of Sterling against the US Dollar due to Brexit
occurred shortly before the end of the half year, and as a result the
financial impact on the first half was limited (translated at average
exchange rates). However, the balance sheet impact was more significant,
with a presentational increase in both assets and liabilities (converted
at spot rate). Despite this, the Group has continued to reduce its
leverage* in both Sterling and US Dollar terms due to its strong cash
generation. Deferred consideration for previous acquisitions will be
completely eliminated by September 2016. Other than the impact of
currency fluctuations, we do not see any material impact of the decision
to exit the EU on our business or prospects.
The Group made good progress on new product development and
qualifications during the half, strengthening its IP position, and
re-enforcing a positive outlook. The Board remains confident that the
Group is on track to achieve full year expectations.
Notice of Results
The Group will report its half year results for 2016 on 13 September
2016.
Dr Drew Nelson, Chief Executive of IQE, said:
"The growth in IQE's sales and profits reflect the increasing
diversification of its revenues, the growing breadth of its end markets,
and the strength of its IP portfolio. As a result, the Group's strong
cash generation continues to de-leverage* its balance sheet, with the
deferred consideration from previous acquisitions on track to be
completely eliminated by the end of September.
The Group's continued diversification of revenues is improving its
resilience to end market fluctuations and our Photonics business
continues to deliver strong double digit growth driven by a range of
emerging end markets which are primed for significant and sustainable
growth.
Our joint ventures have progressed well and have delivered license
income of GBP3.5m, whilst our Wireless and InfraRed businesses were
stable, delivering slight increases in revenues.
With the progress being made on new product qualifications, further
product developments and with increasing revenue diversity, we remain on
track to achieve full year expectations."
This announcement contains inside information.
* Leverage is defined as deferred consideration plus net debt.
Contacts:
IQE plc +44 (0) 29 2083 9400
Drew Nelson
Phil Rasmussen
Chris Meadows
Canaccord Genuity + 44 (0) 20 7523 8000
Simon Bridges
Cameron Duncan
Peel Hunt +44 (0) 20 7418 8900
Richard Kauffer
Euan Brown
Capital Access Group +44 (0) 20 3763 3400
Simon Courtenay
This announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: IQE plc via Globenewswire
HUG#2029476
http://www.iqep.com
(END) Dow Jones Newswires
July 20, 2016 02:00 ET (06:00 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.