Continued strong growth in revenues and profitability
14 July 2011
Cardiff, UK. 14 July 2011: IQE plc (AIM: IQE, “IQE” or the “Group”), the leading global supplier of advanced semiconductor wafer products and wafer services to the semiconductor industry, provides an interim trading update for the six months to 30 June 2011.
The Group expects to report first-half revenues of at least £38 million and EBITDA of at least £6 million, despite the adverse impact of foreign currency exchange. Compared with the first half of 2010, this represents underlying growth in US dollar revenues of over 20%, which includes approximately £1m from the Galaxy business acquired in September 2010.
The strong organic revenue growth has been driven by both the wireless and opto electronics markets. Wireless sales have been driven by sales of Gallium Arsenide (“GaAs”) products into wireless devices and strongly supplemented by the rapid growth of Gallium Nitride (“GaN”) sales into the radar and wireless infrastructure markets.
Organic revenue growth in the optoelectronics market has been driven across a range of end markets including IQE’s world leading Vertical Cavity Surface Emitting Laser (“VCSEL”) technology for consumer and industrial applications, optical communications, and solar power.
The Group continues to make good progress with its electronics division, which is focussed on combining compound semiconductors with silicon to create the next generation in advanced semiconductor materials for a broad range of ultra high speed and high performance applications.
The outlook for the second half remains upbeat. The Board expects continuing robust growth in the Group’s core wireless and optoelectronics businesses, as demand for both industrial and consumer end user devices containing IQE products remain strong. This confidence is strengthened by the continued progress being made in new product developments and qualifications.
Dr Drew Nelson, IQE’s Chief Executive, said:
“The continued growth in demand for our wireless products and accelerated growth for our optoelectronic wafers have enabled us to maintain our rapid growth.
“The prospects for the Group are very exciting and, with our highly geared business model, provide the Board with considerable confidence in a continued improvement in financial performance for the second half.”
IQE expects to report its interim results on 7 September 2011.
Contacts: IQE plc +44 (0) 29 2083 9400 Drew Nelson Phil Rasmussen Chris Meadows
Espirito Santo Investment Bank + 44 (0) 20 7456 9191 Richard Crawley James Bromhead
College Hill +44 (0) 20 7457 2020 Adrian Duffield Kay Larsen
Note to Editors
ABOUT IQE (www.iqep.com) IQE is the leading global supplier of advanced semiconductor wafers with products that cover a diverse range of applications, supported by an innovative outsourced foundry services portfolio that allows the Group to provide a 'one stop shop' for the wafer needs of the world's leading semiconductor manufacturers.
IQE uses advanced crystal growth technology (epitaxy) to manufacture and supply bespoke semiconductor wafers ('epi-wafers') to the major chip manufacturing companies, who then use these wafers to make the chips which form the key components of virtually all high technology systems. IQE is unique in being able to supply wafers using all of the leading crystal growth technology platforms.
IQE's products are found in many leading-edge consumer, communication, computing and industrial applications, including a complete range of wafer products for the wireless industry, such as mobile handsets and wireless infrastructure, Wi-Fi, WiMAX, base stations, GPS, and satellite communications; optical communications, optical storage (CD, DVD), laser optical mouse, laser printers & photocopiers, thermal imagers, leading-edge medical products, barcode, ultra high brightness LEDs, a variety of advanced silicon based systems and high efficiency concentrator photovoltaic (CPV) solar cells.
The manufacturers of these chips are increasingly seeking to outsource wafer production to specialist foundries such as IQE in order to reduce overall wafer costs and accelerate time to market.
IQE also provides bespoke R&D services to deliver customised materials for specific applications and offers specialist technical staff to manufacture to specification either at its own facilities or on the customer's own sites. The Group is also able to leverage its global purchasing volumes to reduce the cost of raw materials. In this way IQE's outsourced services, provide compelling benefits in terms of flexibility and predictability of cost, thereby significantly reducing operating risk.
IQE comprises eight operating facilities located in Cardiff (two), Milton Keynes and Bath in the UK; in Bethlehem, Pennsylvania, Somerset, New Jersey and Spokane, Washington in the USA; and Singapore. The Group also has 11 sales offices located in major economic centres worldwide.