IQE swings to loss on trade-war weakness
IQE reported 1H19 revenues of £66.7 million down 9.1 percent on sales of £73.4 million in 1H18. The company reported an operating loss of £3.1 million compared with an operating profit of £6.6 million in the same period a year before.
The reported net loss after tax is £10.7 million compared with a net profit after tax of £4.2 million in the same period a year before.
The fall in sales revenue was attributed to a weak smartphone handset market, more general reduced demand, international trade tension and a fall in demand from a major InP laser component customer.
“We remain confident in IQE’s ability to adapt to global supply chain shifts and have made significant strategic and operational progress with our global expansion projects. This includes completing the infrastructure phase at our Mega Foundry in Newport, South Wales as well as the capacity expansion in Taiwan and Massachusetts, US ,” said Drew Nelson, CEO of IQE, in a statement.
Second half revenues are expected to represent between 52 and 58 percent of full year revenues with a return to operating profitability. The company said this return to operating profit would be supported by “cost management actions.”
IQE said it would be operationally profitable over the full year but at a level significantly below the 10 percent profit margin guidance originally given.
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