22nd Jul 2014 08:04
LONDON (Alliance News) - Shares in IQE PLC dropped more than 10% Tuesday, after it reiterated it was on track to meet full year expectations, despite warning that it expects its revenue for the half year to end-June will be 17% behind the previous year.
Shares in IQE were trading down 11% at 20.41 pence Tuesday morning.
The semiconductor company said it expects six-month revenue of around GBP52 million, down 17% from GBP63 million, as it continued to be hit by de-stocking from major customers due to softness in the smart-phone market, and the continued strengthening of Sterling.
At constant, currency sales were down around 10%.
IQE said it expects net debt to be less than GBP36 million, compared to GBP37.5 million in the previous year, despite posting a one-off GBP6.5 million restructuring and reorganisation charge. It also invested around GBP2 million in a strategic inventory build-up during the half year.
The company said that during the second quarter it had seen wireless demand begin to recover from de-stocking by customers earlier in the year. Order levels improved, and IQE said it had seen positive customer forecasts for the rest of the year.
This improvement was primarily lead by the acceleration of 4G smartphone adoption in China, new handset launches, and increased adoption of new dual band wifi.
Its photonics business is performing well, IQE said, and it expects to see 20% revenue growth at constant currency compared to the previous year.
IQE's advanced solar business is in the final stages of qualification, it said, and on track to move to production in the second half of the year. Additionally, the development of advanced products including gallium nitride materials and compound semiconductor on silicon technologies is progressing well, it said.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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