IQE sees first-half revenues spark

IQE reiterated its full-year guidance on Tuesday, after the chip specialist saw first-half revenues spark.

The AIM-listed firm reported interim revenues of £86.2m, up 8.4%, or by 1.4% on a constant currency basis. Adjusted earnings before interest, tax, depreciation and amortisation rose 6% to £12.3m.

The operating loss widened to £7.4m compared to £1.9m a year earlier, but IQE - a supplier of compound semiconductor wafer products to the chip industry - left its full-year targets unchanged.

Full-year revenues were on track to show "low, single digit percentage growth" on a constant currency basis, it said, with strong photonics sales helping to offset expected softness in wireless markets. It also expects a similar adjusted EBITDA margin to 2021.

IQE said it had made "strong progress" against its strategic goals during the first half.

Americo Lemos, chief executive, added: "Simultaneously, the business has demonstrated resilience despite the ongoing challenging global environment.

"The importance of compound semiconductors to a series of fundamental mega trends which will shape the economy is gaining increasing recognition."

Numis, which has a ‘buy’ rating on the stock, said IQE was "delivering on all fronts".

It continued: "IQE keeps securing major building blocks to consistently grow value from the 2023 full-year.

"We think IQE’s strategic value is likely a multiple of its current market cap, and we reiterate our view that IQE is worth at least 65p a share."

As at 1030 BST, shares in IQE were ahead 2% at 34.51p.