16th Sep 2014 07:53
LONDON (Alliance News) - IQE PLC Tuesday expressed confidence in meeting full year earnings expectations, despite forecasting lower revenues for the full year, as it swung to a loss in the half year to end-June.
The semiconductor company posted a pretax loss of GBP5.8 million, swung from a profit of GBP2.5 million, as revenue declined to GBP52.0 million from GBP63.0 million, and compounded by a GBP7.9 million in exceptional costs.
The exceptional costs included GBP1.9 million in restructuring costs, a GBP5.0 impairment of property plant and equipment, and a GBP6.7 million provision for an onerous lease, amongst other costs, which were partly offset by a GBP9.7 million gain from the release of a contingent deferred consideration.
IQE said its results had been hit by industry-wide inventory reduction, which it estimated had hit results by around GBP8.5 million, and the strength of sterling, which it said hit results by a further GBP4.2 million.
The fall in revenue was somewhat offset by cost reductions from the company's restructuring programme. IQE said this restructuring was now largely complete, and is expected to deliver further savings in the second half.
IQE remained optimistic for its future, noting that de-stocking was concluded during the second quarter, and its customers had forecast an upbeat second half.
Additionally, its concentrated photovoltaic business is in the final stages of end customer qualification, and remains on track to move to production in the second half of the year, IQE said.
Shares in IQE were trading down 10% at 18.00 pence Tuesday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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