Year-end trading update: Strong second half delivers significant increase in profits and cash genera
(Thomson Reuters ONE) - IQE plcStrong second half delivers significant increase in profits and cash generation19 January 2010IQE plc (AIM: IQE, "IQE" or the "Group") the leading global supplier of advancedsemiconductor wafer products and services to the semiconductor industry,provides a trading update for the year ended 31 December 2009.The Group experienced a strong second half recovery following the industry-widedestocking that adversely impacted the first six months of 2009. As a result,IQE expects to report full year 2009 results in line with market expectations,despite the adverse currency impact of sterling strengthening against the USDollar in the second half.Second half revenues are expected to be 45% higher than first half. With thebenefit of high operational gearing and stringent cost controls, IQE expects toreport more than a threefold increase in second half EBITDA from £1.9m in thefirst half, to deliver a full year EBITDA of approximately £8m.Continued tight control of working capital and capex delivered substantial freecash generation in the second half of 2009. As a result, net debt is expectedto be significantly better than market expectations at approximately £15m - areduction of approximately £4m since June 2009.IQE's strong second half performance reflects increasing demand for GalliumArsenide ('GaAs') wafers in the wireless communications market, as well as adiverse range of high growth opto electronics markets.The growth in wireless is being driven by a structural shift as GaAs-richsmartphones enjoy a rapid increase in popularity, and emerging economies such asthe BRIC nations roll out 3G networks to satisfy increasing demand forhigh-speed mobile internet and data services.The growth in optoelectronics is being driven by a diverse range of factors.Demand for solar cells and solid state lighting is growing in response toregulatory and environmental pressures. In contrast, consumer and industrialdemand is driving growth in a number of applications including 'hands free'gaming, laser projection, high speed data communications (broadband), andadvanced optical storage.Dr Drew Nelson, IQE's Chief Executive, said:"We have demonstrated a high degree of resilience through a challenging year.Proactive management protected the business through the downturn, withoutjeopardising our ability to respond when sales volumes recovered strongly in thesecond half."Despite the economic turmoil, IQE has continued to strengthen its marketposition by attracting new talent and gaining new product qualifications toincrease market share."We are making good progress in developing and commercialising key intellectualproperty that will provide a competitive advantage and secure leading positionsin a number of emerging high-growth markets including solar power, laserprojection systems and solid state lighting."The Board remains confident that IQE is well positioned to achieve continuedgrowth in sales, profits and cash flow in 2010."IQE expects to report its preliminary results on 24 March 2010.Contacts:IQE plc (+44 29 2083 9400)Chris MeadowsPhil RasmussenDrew NelsonNoble & Company Limited (+ 44 20 7763 2200)John Llewellyn-LloydSam ReynoldsCollege Hill (+44 20 7457 2020)Adrian DuffieldCarl Franklin[HUG#1374600]
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Datum: 19.01.2010 - 02:01 Uhr
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