REG - IQE PLC - IQE plc: H1 2024 Interim Results
10/09/2024 07:00
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RNS Number : 5067D IQE PLC 10 September 2024
IQE plc
Cardiff, UK
10 September 2024
Unaudited Results for the six months ended 30 June 2024
Steady progress with year-on-year revenue growth
IQE plc (AIM: IQE, "IQE" or the "Group"), the leading global supplier of
compound semiconductor wafer products and advanced material solutions,
announces its interim results for the six months ended 30 June 2024. Revenue
for the period was £66.0m, with an adjusted non-GAAP EBITDA of £6.6m.
Americo Lemos, Chief Executive Officer of IQE, commented:
"IQE delivered a consistent performance in the first half of 2024, with a 27%
rise in revenue year-on-year and a return to a positive adjusted EBITDA
position. We expect the market to continue to show pockets of recovery during
the second half, resulting in more moderate growth for 2024 on a full-year
basis. We look forward to progressing the planned IPO of our Taiwanese
subsidiary, which will help to accelerate our diversification strategy into
the GaN Power market and microLED, and will provide additional significant
cash resources for the Company."
H1 2024 Financial Results
H1 2024 H1 2023
£'m* £'m*
Revenue 66.0 52.0
Adjusted EBITDA** 6.6 (5.7)
Operating loss (12.1) (19.6)
Adjusted operating loss** (7.2) (17.5)
Reported loss after tax (15.1) (21.3)
Diluted EPS (1.57p) (2.57p)
Adjusted diluted EPS** (1.05p) (2.30p)
Cash generated from operations (2.6) 2.4
Adjusted cash from operations** 1.8 4.3
Capital Investment (PP&E) 5.0 5.2
Net funds / (debt)*** (17.0) 5.3
* All figures £'m excluding diluted and adjusted diluted EPS.
** Adjusted Measures: Alternative performance measures are disclosed
separately after a number of non-cash charges, non-operational items and
significant infrequent items that would distort period on period
comparability. Adjusted items are material items of income or expense that
have been shown separately due to the significance of their nature or amount
as detailed in note 8.
*** Net funds/debt excludes IFRS16 lease liabilities and fair value
gains/losses on derivative instruments.
The following highlights of the first half results are based on these adjusted
performance measures, unless otherwise stated.
Strategic Highlights
Wireless
Growth driven by communications infrastructure and penetration into the
Android smartphone and WiFi market
· Successful launch of an 8" GaN on Si product with a major Tier 1
foundry supporting 5G RF base station infrastructure.
· Delivered high power RF amplifier products using GaN on SiC for 5G
base station radios to both IDM and fabless customers in North America, Europe
and Asia.
· Delivered sample GaAs HBT power amplifiers to two leading compound
semiconductor foundries, enabling 5G RF Front End products for Android
smartphones and WiFi 7.
Photonics
Well positioned with new technology to capture demand from Gen AI data centres
· Qualification of InP laser technology for high-speed optical
transceivers deployed within large-scale gen AI data centres.
· Delivery of new high speed data communications VCSEL product to
address market demand for short-reach optical transceiver applications.
· Qualification of Quantum Dot Laser (QDL) products by an
industry-leading Silicon Photonics customer, enabling the development of
energy-efficient, on-chip laser architectures for next-generation data centre
networking applications.
· Delivery of next-generation 3D Sensing VCSEL products for
module-level qualification in new AR/VR and mobile platforms.
Power
Increased GaN capacity enabling qualification ramp-up
· Progress with customer qualification of 650V e/d-mode GaN products
for Tier 1 OEMs.
· Continued to deploy GaN Power capacity in the US and UK to serve the
global Power Electronics market
Display
Successful development driving sampling with new and existing customers
· Successful launch of new 8" GaAs and GaN RGB microLED product
portfolio with strong engagement from Tier 1 consumer mobile and display
manufacturers.
· Continuation of long term engagement with an AR/VR customer to
deliver next-generation microLED display materials.
H1 2024 Financial Highlights
· Revenue of £66.0m (H1 2023: £52.0m) increased 26.9% vs H1 2023.
‒ Wireless revenue of £38.8m (H1 2023: £22.4m) increased 73%
year-on-year on a reported basis. This was a result of inventory normalisation
and design wins in Android RF Front End markets.
‒ Photonics revenue of £26.8m (H1 2023: £28.0m) was down 4%
year-on-year on a reported basis. A reduction in segments of InP telecoms
markets was partially offset by strength in GaAs Photonics and infrared
sensing product sales.
‒ CMOS++ revenue of £0.5m (H1 2023: £1.6m) down 70% on a reported
basis. This reflects a strategic rebalancing of IQE's product portfolio and a
shift in focus towards diversification into GaN Power and MicroLED. Reporting
on this segment will cease from 2025.
· Adjusted EBITDA of £6.6m (H1 2023: £(5.7)m LBITDA) up £12.3m, as a
result of a combination of increased revenue, improved asset utilisation, and
the benefit of cost control actions.
· Reported operating loss of £(12.1)m (H1 2023: £(19.6)m loss).
· Adjusted cash inflow from operations of £1.8m (H1 2023: £4.3m)
reflecting a combination of improved trading performance offset by an increase
in working capital.
· Total net cash capex and cash investment in intangibles of £6.5m (H1
2023: £8.4m)
· Adjusted net debt of £(17.0)m as at 30 June 2024 (net debt of
£(2.2)m as at 31 Dec 2023, net funds of £5.3m as at 30 June 2023).
· Cost control actions
‒ Reduced labour costs by c.10% year-on-year while ensuring balance
of operational efficiency and skills retention.
‒ Reduced non-labour costs by c.5% year-on-year.
‒ Sale of decommissioned Pennsylvania site expected to complete in
H2 2024.
Current trading and outlook
Signs of recovery in the global semiconductor industry continue, despite the
pace of progress varying between regions and market segments.
IQE delivered an improved performance in H1 and year-on-year growth is
expected in both revenue and adjusted EBITDA for FY 2024. With some markets
remaining in recovery in H2 2024, performance is expected to be at the lower
end of the range of analyst forecasts for the full year(1).
IQE will maintain a tight focus on structural cost controls, footprint
optimisation and operational efficiencies. This will allow the business to
continue to improve its profitability while building its market-led technology
roadmap in partnership with key customers.
In July 2024, the Group announced plans for the IPO of its Taiwan operating
subsidiary on the Taiwan Stock Exchange. This represents an exciting
opportunity for IQE to maximise value across its asset base and accelerate the
investment in its growth and diversification strategy while continuing to
maintain its secure and resilient supply chain. The Group has had a very
positive reaction from its first round of engagement with investors in the
region, and expects to list on the Emerging Market Board of the Taiwan Stock
Exchange in H1 2025. Further updates will be provided when appropriate.
1. The analyst range of expectations for FY 2024 revenue are from £130.0m to
£153.7m and for adjusted EBITDA from £11.1m to £16.6m.
Results Presentation
IQE will present its H1 2024 Results via webcast at 9:00am today, Tuesday 10
September 2024. If you would like to view this webcast, please register by
using the below link and following the instructions:
https://brrmedia.news/IQE_IR_24 (https://brrmedia.news/IQE_IR_24)
Contacts:
IQE plc
+44 (0) 29 2083 9400
Americo Lemos
Jutta Meier
Amy Barlow
Peel Hunt (Nomad and Joint Broker)
+44 (0) 20 7418 8900
Ben Cryer
Kate Bannatyne
Adam Telling
Deutsche Numis (Joint Broker)
+44 (0) 20 7260 1000
Simon Willis
Hugo Rubinstein
Iqra Amin
Headland Consultancy (Financial PR)
+ 44 (0) 20 38054822
Andy Rivett-Carnac: +44 (0) 7968 997 365
Chloe Francklin: +44 (0)78 3497 4624
ABOUT IQE
http://iqep.com
(https://www.globenewswire.com/Tracker?data=yZf7NKp1JKLALUCxlBuC8wkLnLAqoe5-kjjIlkMIDci9q9W0x_02bwZV-eorSbpLXZxy4zi3xHh-O4FM8nWjeg==)
IQE is the leading global supplier of advanced compound semiconductor wafers
and materials solutions that enable a diverse range of applications across:
· Smart Connected Devices
· Communications Infrastructure
· Automotive and Industrial
· Aerospace and Security
As a scaled global epitaxy wafer manufacturer, IQE is uniquely positioned in
this market which has high barriers to entry. IQE supplies the global market
and is enabling customers to innovate at chip and OEM level. By leveraging the
Group's intellectual property portfolio including know-how and patents, it
produces epitaxy wafers of superior quality, yield and unit economics.
IQE is headquartered in Cardiff UK, with employees across manufacturing
locations in the UK, US and Taiwan, and is listed on the AIM Stock Exchange in
London.
Financial Review
Consolidated Income Statement
6 months to 6 months to 12 months to
30 Jun 2024 30 Jun 2023 31 Dec 2023
(All figures £'000s) Note Unaudited Unaudited Audited
Revenue 7 66,018 52,016 115,252
Cost of sales (61,026) (56,241) (112,924)
Gross profit/(loss) 4,992 (4,225) 2,328
Selling, general and administrative expenses (16,301) (16,404) (32,486)
Impairment (loss)/reversal on trade receivables and contract assets (31) 355 1,808
Gain on acquisition of remaining interest in CSC - - 2,419
(Loss)/profit on disposal of intangible assets and property, plant and (1,094) - 152
equipment
Gains on remeasurement of right of use asset 296 - -
Other gains - 640 -
Operating loss 7 (12,138) (19,634) (25,779)
Finance costs (1,765) (1,832) (3,032)
Adjusted loss before income tax (8,972) (19,291) (23,231)
Adjustments 8 (4,931) (2,175) (5,580)
Loss before income tax 7 (13,903) (21,466) (28,811)
Taxation (1,168) 141 (567)
Loss for the period (15,071) (21,325) (29,378)
Loss attributable to:
Equity shareholders (15,071) (21,325) (29,378)
(15,071) (21,325) (29,378)
Loss per share attributable to owners of the parent during the period
Basic loss per (1.57p) (2.57p) (3.28p)
share
10
Diluted loss per (1.57p) (2.57p) (3.28p)
share
10
Adjusted basic and diluted earnings per share are presented in Note 10.
All items included in the loss for the period relate to continuing operations.
Consolidated statement of comprehensive income
6 months to 6 months to 12 months to
30 Jun 2024 30 Jun 2023 31 Dec 2023
(All figures £'000s) Unaudited Unaudited Audited
Loss for the period (15,071) (21,325) (29,378)
Exchange differences on translation of foreign operations* (1,181) (7,682) (8,088)
Total comprehensive expense for the period (16,252) (29,007) (37,466)
Total comprehensive expense attributable to:
Equity shareholders (16,252) (29,007) (37,466)
(16,252) (29,007) (37,466)
* Balance might subsequently be reclassified to the income statement when
it becomes realised.
Consolidated Balance Sheet
As At As At As At
30 Jun 2024 30 Jun 2023 31 Dec 2023
(All figures £'000s) Note Unaudited Unaudited Audited
Non-current assets
Intangible assets 34,275 35,061 35,378
Property, plant and equipment 124,716 121,640 129,553
Right of use assets 45,684 38,918 37,895
Total non-current assets 204,675 195,619 202,826
Current assets
Inventories 24,618 25,874 24,577
Trade and other receivables 46,849 36,996 38,220
Derivative financial instruments 12 - 259 -
Cash and cash equivalents 12 7,810 12,314 5,617
Assets held for resale 2,304 - 2,274
Total current assets 81,581 75,443 70,688
Total assets 286,256 271,062 273,514
Current liabilities
Trade and other payables (48,794) (33,458) (42,572)
Current tax liabilities (586) (65) (531)
Bank borrowings 12 (1,569) (6,123) (4,153)
Lease liabilities 12 (7,329) (7,140) (5,865)
Provisions for other liabilities and charges (1,225) (2,194) (2,998)
Total current liabilities (59,503) (48,980) (56,119)
Non-current liabilities
Trade and other payables (2,148) - (2,208)
Bank borrowings 12 (23,220) (845) (3,692)
Lease liabilities 12 (44,493) (42,826) (40,435)
Provisions for other liabilities and charges (504) (1,291) (671)
Deferred tax liabilities (710) (710) (604)
Total non-current liabilities (71,075) (45,672) (47,610)
Total liabilities (130,578) (94,652) (103,729)
Net assets 155,678 176,410 169,785
Equity attributable to shareholders of the parent
Share capital 13 9,666 9,614 9,615
Share premium 155,920 155,825 155,844
Retained earnings (62,537) (39,413) (47,466)
Exchange rate reserve 31,266 32,853 32,447
Other reserves 21,363 17,531 19,345
Total equity 155,678 176,410 169,785
Consolidated Statement of Changes in Equity
Unaudited Share capital Share premium Retained earnings Exchange rate reserve Other reserves Total equity
(All figures £'000s)
At 1 January 2024 9,615 155,844 (47,466) 32,447 19,345 169,785
Loss for the period - - (15,071) - - (15,071)
Other comprehensive expense for the period - - - (1,181) - (1,181)
Total comprehensive expense - - (15,071) (1,181) - (16,252)
Share based payments - - - - 2,018 2,018
Proceeds from shares issued (net of expenses) 51 76 - - - 127
Total transactions with owners 51 76 - - 2,018 2,145
At 30 June 2024 9,666 155,920 (62,537) 31,266 21,363 155,678
Unaudited Share capital Share premium Retained earnings Exchange rate reserve Other reserves Total equity
(All figures £'000s)
At 1 January 2023 8,048 154,720 (45,246) 40,535 17,003 175,060
Loss for the period - - (21,325) - - (21,325)
Other comprehensive income for the period - - - (7,682) - (7,682)
Total comprehensive expense - - (21,325) (7,682) - (29,007)
Share based payments - - - - 528 528
Proceeds/charge from shares issued 1,566 1,105 (1,342) - 28,500 29,829
Transfer of merger reserve to retained earnings - - 28,500 - (28,500) -
Total transactions with owners 1,566 1,105 27,158 - 528 30,357
At 30 June 2023 9,614 155,825 (39,413) 32,853 17,531 176,410
Audited Share capital Share premium Retained earnings Exchange rate reserve Other reserves Total equity
(All figures £'000s)
At 1 January 2023 8,048 154,720 (45,246) 40,535 17,003 175,060
Loss for the year - - (29,378) - - (29,378)
Other comprehensive expense for the year
- - - (8,088) - (8,088)
Total comprehensive expense - - (29,378) (8,088) - (37,466)
Share based payments - - - - 2,484 2,484
Tax relating to share options - - - - (142) (142)
Proceeds/(charge) from shares issued 1,567 1,124 (1,342) - 28,500 29,849
Transfer of merger reserve to retained earnings
- - 28,500 - (28,500) -
Total transactions with owners 1,567 1,124 27,158 - 2,342 32,191
At 31 December 2023 9,615 155,844 (47,466) 32,447 19,345 169,785
The comparative financial information for the 6 months to 30 June 2023 has
been restated to reclassify £1,342,000 from transfer of merger reserve to
retained earnings to proceeds/(charge) from shares issued in order to adopt a
consistent presentation with the audited financial statements for the year
ended 31 December 2023. The reclassification has had no impact on net assets,
cash flows or loss after tax for the 6 months to 30 June 2023.
Consolidated Cash Flow Statement 6 months to 6 months to 12 months to
30 Jun 2024 30 Jun 2023 31 Dec 2023
(All figures £'000s) Note Unaudited Unaudited Audited
Cash flows from operating activities
Adjusted cash inflow from operations 1,789 4,296 15,744
Cash impact of adjustments 8 (4,421) (1,864) (5,670)
Cash generated from operations 11 (2,632) 2,432 10,074
Net interest paid (1,410) (1,565) (3,242)
Income tax paid (701) (726) (912)
Net cash generated from operating activities (4,743) 141 5,920
Cash flows from investing activities
Purchase of property, plant and equipment (4,959) (5,183) (12,158)
Purchase of intangible assets (916) (1,681) (3,113)
Capitalised development expenditure (1,405) (1,590) (2,852)
Proceeds from disposal of property, plant and equipment and intangible assets 942 12 553
Acquisition of subsidiary, net of cash received (128) - (390)
Adjusted cash used in investing activities (7,317) (8,442) (17,960)
Cash impact of adjustments - proceeds from disposal of property, plant and 8 851 - -
equipment and intangible assets
Net cash used in investing activities (6,466) (8,442) (17,960)
Cash flows from financing activities
Proceeds from issuance of ordinary shares 127 31,219 31,239
Expenses associated with issue of ordinary shares - (1,390) (1,390)
Proceeds from borrowings 19,493 5,833 9,932
Repayment of borrowings (2,532) (25,302) (28,363)
Payment of lease liabilities (3,613) (748) (4,787)
Net cash generated from financing activities 13,475 9,612 6,631
Net increase / (decrease) in cash and cash equivalents 2,266 1,311 (5,409)
Cash and cash equivalents at the beginning of the period 5,617 11,620 11,620
Exchange losses on cash and cash equivalents (73) (617) (594)
Cash and cash equivalents at the end of the period 12 7,810 12,314 5,617
1. REPORTING ENTITY
IQE plc is a public limited company incorporated in the United Kingdom under
the Companies Act 2006. The Company is domiciled in the United Kingdom and is
quoted on the Alternative Investment Market (AIM).
These condensed consolidated interim financial statements ('interim financial
statements') as at and for the six months ended 30 June 2024 comprise the
Company and its Subsidiaries (together referred to as 'the Group'). The
principal activities of the Group are the development, manufacture and sale of
advanced semiconductor materials.
2. BASIS OF PREPARATION
These interim financial statements have been prepared in accordance with IAS
34 'Interim Financial Reporting', and should be read in conjunction with the
Group's last annual consolidated financial statements as at and for the year
ended 31 December 2023 which were approved by the Board of Directors on 9
April 2024 and have been delivered to the Registrar of Companies. The report
of the auditors on those financial statements was unqualified, did not contain
an emphasis of matter paragraph and did not contain any statement under
section 498 of the Companies Act 2006.
The interim financial statements do not include all of the information
required for a complete set of IFRS financial statements and do not constitute
statutory accounts within the meaning of section 434 of the Companies Act
2006. However, selected explanatory notes are included to explain events and
transactions that are significant to an understanding of the changes in the
Group's financial position and performance since the last annual financial
statements.
Comparative information in the interim financial statements as at and for the
year ended 31 December 2023 has been taken from the published audited
financial statements as at and for the year ended 31 December 2023. All other
periods presented are unaudited.
The Board of Directors and the Audit Committee approved the interim financial
statements on 9 September 2024.
3. GOING CONCERN
The Group experienced weaker customer demand and lower customer orders in 2023
as a result of the global semiconductor industry downturn prior to a gradual
improvement in market dynamics and customer demand from Q4 2023 which has
delivered revenue growth of 26.9% in H1 2024. Despite the gradual improvement
in market dynamics in H1 2024 the semiconductor industry remains in recovery
as markets continue to correct at varying paces with slower growth now
expected to extend throughout H2 2024, ahead of an expected full market
recovery in 2025.
In the six months to 30 June 2024, reported revenue increased 26.9% with the
group reducing its loss for the period to £15,071,000 (H1 2023: £21,325,000,
FY23: £29,378,000). The cash impact of the loss for the period, combined with
an increase in working capital, investment in capital and intangible asset
development and debt and lease service costs has resulted in an increase in
the Group's net debt position (excluding lease liabilities and fair value
gains/losses on derivative instruments) to £16,979,000 (H1 2022: £5,346,000
net funds, FY23: £2,228,000 net debt). At 30 June 2024 the Group had
undrawn committed funding of £4,300,000 ($5,500,000) available under the
terms of its credit facilities.
In assessing the going concern basis of preparation the Directors have
reviewed financial projections to 31 December 2025 ('the going concern
assessment period'), containing both a 'base case' and a 'severe but plausible
downside case'. The review period extends beyond the minimum required 12-month
period from the date of approval of the interim financial statements to
protect against the recovery in the semiconductor market occurring later than
forecast by the Directors.
Base Case
The base case is the Group's latest Board approved 2024 and 2025 forecasts.
The base case incorporates a gradual improvement in market dynamics in H2 2024
prior to a full market recovery in 2025 and the impact of cost cutting actions
primarily implemented by the Board in 2023.
In the base case the Group is forecast to maintain liquidity headroom and to
comply with its leverage and interest cover banking covenants throughout the
going concern assessment period. Liquidity headroom falls to
£5.5m in September 2024 prior to a gradual forecast improvement during 2025,
interest cover as well as leverage covenant headroom is low at Q4 2024 before
a gradual forecast increase in headroom during 2025 for both covenants.
Severe but plausible downside case
A severe but plausible downside scenario was modelled for H2 2024 and 2025,
reflecting a combination of greater uncertainty further out into the future, a
delay in market recovery and a delay in the new Power GaN business which is
forecast to ramp up in 2025. In line with an assumed revenue reduction in both
years, there is a reflective reduction in variable operating costs for 2024
and 2025, as well as mitigations in the form of further structural cost
savings, and deferred investment in capital expenditure and technology asset
development over and above those already reflected in the base case. These
cost savings and cash management actions have already been identified, are in
the control of management and are immediately actionable.
In the severe but plausible downside scenario modelled, the Group is forecast
to maintain liquidity headroom and to comply with its leverage and interest
cover banking covenants throughout the going concern assessment period.
Liquidity headroom falls to a low of £4.1m in August 2025, interest cover as
well as leverage covenant headroom is low at Q4 2024 before a gradual forecast
increase in headroom during 2025 for both covenants.
Whilst acknowledging that under the severe but plausible scenario liquidity
and covenant headroom is tight, the Directors believe that the Company and
Group will have adequate cash resources to continue operating for the
foreseeable future and to meet their liabilities as they fall due for the
going concern assessment period, such that the Directors consider it
appropriate to adopt the going concern basis of accounting in preparing the
Company and Group consolidated financial statements.
4. USE OF JUDGEMENTS AND ESTIMATES
In preparing these interim financial statements, management has made
judgements and estimates that affect the application of accounting policies
and the reported amounts of assets, liabilities, income and expense. Actual
results may differ from these estimates.
The significant judgements made by management in applying the Group's
accounting policies and the key sources of estimation uncertainty were the
same as those described in the last annual financial statements except as
follows:
Impairment of Cash Generating Units ('CGU')
At the end of each reporting period, the Group assesses whether there is any
indication of impairment of non-current assets allocated to the Group's CGU's.
Multiple production facilities and production assets are included in a single
CGU reflecting that production can (and is) transferred between sites and
production assets for different operating segments to suit capacity planning
and operational efficiency. Given the interdependency of facilities and
production assets non-current assets are tested for impairment by grouping
operational sites and production assets into CGUs based on type of production.
In the six months to 30 June 2024, the Group has experienced a gradual
improvement in market dynamics and customer demand following the global
semiconductor industry downturn, which, combined with a reduction in central
corporate costs has resulted in a reduction in the loss for the period to
£15,071,000 (H1 2023: £21,325,000, 2023: £29,378,000). The gradual
improvement in market dynamics and customer demand has principally been
focused in the Group's Wireless CGU which has delivered an operating profit of
£3,995,000 (H1 2023: £3,262,000 loss, 2023: £3,634,000 profit). The Group's
Photonics CGU continues to be loss making with an operating loss for the
period of £7,495,000 (H1: 2023: £7,179,000, 2023: £12,433,000). The losses
generated within the Photonics CGU and the low levels of profitability within
the Group's Wireless CGU have been assessed as an indicator of impairment such
that an impairment assessment of the non-current assets allocated to the
Photonics and Wireless CGU's has been performed.
The recoverable amount of the Photonics and Wireless CGU's have been
determined based on value in use calculations, using cash flow projections for
a five-year period plus a terminal value based upon a long-term growth rate of
2% in line with The Bank of England's monetary policy 2% inflation target.
Value in use calculations are based on the Group's latest 2024 and 2025
forecast and latest 2026 to H1 2029 projections which have been adjusted to
exclude the impact of expansionary capital expenditure and certain linked
earnings and cash flows. The value in use calculations incorporate cashflows
associated with the group's diversification into high-growth GaN power
markets. Revenue assumptions in year 1 reflect a gradual improvement in market
dynamics and customer demand, aligned with the low end of current analyst
ranges ahead of an expected full market recovery in year 2 where revenue is
aligned with the higher high end of current analyst ranges. Revenue
assumptions in the adjusted cash flow projections for years 3 to 5 have
typically been extrapolated from year 2 using business segment growth rates
that take account of industry trends and external market research, with
incremental customer and market share wins overlaid on top of market growth
assumptions.
The calculation of the recoverable amount of the CGU in the value in use
calculation is highly sensitive to small changes in the following key
assumptions applied in the 2024 and 2025 cash flow forecast:
Year 1 Year 2 Year 3 Year 4 Year 5 5 Year
% % % % % CAGR
%
Risk adjusted discount rate 18.1% 18.1% 18.1% 18.1% 18.1% N/A
Latest 2024 and 2025 forecast
Photonics revenue growth rate Latest 2024 and 2025 forecast
5.8% 5.0% 7.0% 18.6%
Latest 2024 and 2025 forecast
Wireless revenue growth rate Latest 2024 and 2025 forecast
9.3% 12.8% 6.0% 9.4%
Year 1 represents H2 2024 and H1 2025, year 2 represents H2 2025 and H1 2026,
year 3 represents H2 2026 and H1 2027, year 4 represents H2 2027 and H1 2028,
year 5 represents H2 2028 and H1 2029.
Wireless CGU
The recoverable amount of the Wireless CGU of £106,237,000, determined based
on value in use calculations is greater than the carrying amount
(£101,742,000) of the associated intangible assets, property, plant and
equipment and right of use assets allocated to the CGU such that no impairment
of Wireless CGU assets has been identified.
The Group has carried out a sensitivity analysis on the impairment test for
the Wireless CGU, using various reasonably plausible scenarios focused on
changes in business segment growth rates, direct wafer product margins and
changes in the discount rate applied in the value in use calculations.
· Growth rates in the value in use calculations take account of
continuing market demand for compound semiconductors and associated technology
advancement, driven by macro trends of 5G and connected devices where 5G
network infrastructure and 5G mobile handsets are being enabled by next
generation wireless compound semiconductor material. If the aggregated
compound annual revenue growth rate used in the value in use calculations to
determine the recoverable amount was to decrease by 1.0%, the magnitude of the
adverse impact on the recoverable amount of Wireless CGU non-current assets
would be £17,993,000.
· If direct wafer product margins for all products used in the
value in use calculations to determine the recoverable amount were reduced by
1.0%, the magnitude of the adverse impact on the Wireless CGU impairment would
be £18,321,000.
· If the discount rate used in the value in use calculations to
determine the recoverable amount was to increase by 0.5%, the magnitude of the
adverse impact on the recoverable amount of Wireless CGU non-current assets
would be £3,775,000.
Photonics CGU
The recoverable amount of the Photonics CGU of £160,715,000, determined based
on value in use calculations is greater than the carrying amount
(£115,448,000) of the associated intangible assets, property, plant and
equipment and right of use assets allocated to the CGU such that no impairment
of Photonics CGU assets has been identified.
The Group has carried out a sensitivity analysis on the impairment test for
the Photonics CGU, using various reasonably plausible scenarios focused on
changes in business segment growth rates, direct wafer product margins and
changes in the discount rate applied in the value in use calculations.
· Growth rates in the value in use calculations take account of
continuing market demand for compound semiconductors and associated technology
advancement, driven by macro trends of 5G and connected devices, and the
increasing proliferation of 3D and advanced sensing end user applications that
require enabling compound semiconductor material. If the aggregated compound
annual revenue growth rate used in the value in use calculations to determine
the recoverable amount was to decrease by 1.0%, the magnitude of the adverse
impact on the recoverable amount of Photonics CGU non-current assets would be
£26,503,000.
· If direct wafer product margins for all products used in the
value in use calculations to determine the recoverable amount were reduced by
1.0%, the magnitude of the adverse impact on the Photonics CGU impairment
would be £14,556,000.
· If the discount rate used in the value in use calculations to
determine the recoverable amount was to increase by 0.5%, the magnitude of the
adverse impact on the recoverable amount of Photonics CGU non-current assets
would be £5,743,000.
5. MATERIAL ACCOUNTING POLICIES
The accounting policies applied in these interim financial statements are the
same as those applied in the Group's consolidated financial statements as at
and for the year ended 31 December 2023. A number of new standards are
effective from 1 January 2024 but they do not have a material effect on the
Group's financial statements.
Recent accounting developments and the policy for recognising and measuring
income taxes in the interim period are described below.
5.1 Recent accounting developments
In preparing the interim financial statements, the Group has adopted the
following Standards, amendments and interpretations, which are effective for
2024 and will be adopted in the financial statements for the year ended 31
December 2024:
· Amendment to IAS 1 'Presentation of Financial Statements' on
classification of liabilities which is intended to clarify that liabilities
are classified as either current or non-current depending upon the rights that
exist at the end of the reporting period. The amendment also requires
disclosure of information for non-current liabilities that are subject to
future covenants relating to the risk that the liability could become
repayable within 12 months.
· Amendment to IAS 7 'Statement of Cash Flows' and IFRS 7
'Financial Instruments: Disclosures' related to the disclosure and
transparency of supplier finance arrangements.
· Amendment to IAS 12 'Income taxes' which provides temporary
mandatory relief from deferred tax accounting for top up tax and disclosure of
new information to compensate for the potential loss of information arising
from the mandatory relief.
· Amendment to IFRS 16 'Leases' which confirms the initial and
subsequent recognition principles for variable lease payments as a liability
in a sale and leaseback transaction
The adoption of these standards and amendments has not had a material impact
on the interim financial statements.
5.2 Income tax expense
Income tax expense is recognised at an amount determined by multiplying the
loss before tax for the interim reporting period by management's best estimate
of the weighted-average annual income tax rate expected for the full financial
year, adjusted for the tax effect of certain items recognised in full in the
interim period. As such, the effective tax rate in the interim financial
statements may differ from management's estimate of the effective tax rate for
the annual financial statements.
6. PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks and uncertainties affecting the Group are set out in the
Strategic Report in the 2023 Annual report and financial statements and remain
unchanged at 30 June 2024.The principal risks and uncertainties include:
· Health, safety, security and environment as the Group operates a
number of manufacturing sites which utilise potentially harmful gases,
materials and equipment
· Availability of sufficient capital and cash liquidity as the
group has been exposed to the semiconductor industry downturn through late
2022, 20283 and into 2024 which has resulted in financial losses
· Climate change and the risks relating to supply chain and
business disruption arising from extreme weather events and risks arising from
the failure to meet climate reporting obligations and increased energy costs
· Loss of key people
· International trade compliance and the risks associated with
non-compliance with complex international export control laws
· Intellectual property and the risks associated with either IQE
infringing the intellectual property rights of a third party or a third party
infringing on IQE's intellectual property rights
· Information technology risks including cyber-attacks, ransom ware
and/or viruses and risks associated with legacy system failure or cessation
· Business environment, including customer demand and input cost
risks
7. SEGMENTAL INFORMATION
6 Months to 30 June 2024 6 Months to 30 June 2023 12 Months to 31 Dec 2023
Unaudited Unaudited Audited
£'000 £'000 £'000
Revenue
Wireless 38,779 22,438 53,877
Photonics 26,765 28,012 59,098
CMOS++ 474 1,566 2,277
Revenue 66,018 52,016 115,252
Adjusted operating loss
Wireless 4,981 (2,978) 4,638
Photonics (4,338) (6,354) (9,988)
CMOS++ (964) (932) (2,269)
Central corporate costs (6,886) (7,195) (12,580)
Adjusted operating loss (7,207) (17,459) (20,199)
Adjusted items
Wireless (986) (284) (1,004)
Photonics (3,157) (825) (2,445)
CMOS++ (79) (15) (45)
Central corporate costs (709) (1,051) (2,086)
Operating loss (12,138) (19,634) (25,779)
Finance costs (1,765) (1,832) (3,032)
Loss before tax (13,903) (21,466) (28,811)
8. ADJUSTED PERFORMANCE MEASURES
The Group's results report certain financial measures after a number of
adjusted items that are not defined or recognised under IFRS including,
adjusted earnings before interest, tax, depreciation and amortisation,
adjusted operating loss, adjusted loss before income tax and adjusted losses
per share. The Directors believe that the adjusted performance measures
provide a useful comparison of business trends and performance and allow
management and other stakeholders to better compare the performance of the
Group between the current and prior year, excluding the effects of certain
non-cash charges, non-operational items and significant infrequent items that
would distort period on period comparability. The Group uses these adjusted
performance measures for internal planning, budgeting, reporting and
assessment of the performance of the business. The tables below show the
adjustments made to arrive at the adjusted performance measures and the impact
on the Group's reported financial performance.
6 months to 30 Jun 2024 6 months to 30 Jun 2023
Reported Reported 2023
Adjusted Adjusted Adjusted Adjusted Adjusted Adjusted Reported
£'000s Results Items Results Results Items Results Results Items Results
Revenue 66,018 - 66,018 52,016 - 52,016 115,252 - 115,252
Cost of sales (60,316) (710) (61,026) (56,088) (153) (56,241) (111,244) (1,680) (112,924)
Gross profit/(loss) 5,702 (710) 4,992 (4,072) (153) (4,225) 4,008 (1,680) 2,328
Other gains - - - 640 - 640 - - -
SG&A (13,229) (3,072) (16,301) (14,382) (2,022) (16,404) (26,167) (6,319) (32,486)
Impairment (loss)/reversal of receivables (31) - (31) 355 - 355 1,808 - 1,808
Gains on acquisitions - - - - - - - 2,419 2,419
Profit/(loss) on disposal of PPE 55 (1,149) (1,094) - - - 152 - 152
Gain on remeasurement of right of use asset 296 - 296 - - - - - -
Operating loss (7,207) (4,931) (12,138) (17,459) (2,175) (19,634) (20,199) (5,580) (25,779)
Finance costs (1,765) - (1,765) (1,832) - (1,832) (3,032) - (3,032)
Loss before tax (8,972) (4,931) (13,903) (19,291) (2,175) (21,466) (23,231) (5,580) (28,811)
Taxation (1,168) - (1,168) 141 - 141 (759) 192 (567)
Loss for the period (10,140) (4,931) (15,071) (19,150) (2,175) (21,325) (23,990) (5,388) (29,378)
6 months to 30 Jun 2024 6 months to 30 Jun 2023
Reported Reported 2023
Pre-tax Tax Pre-tax Tax Pre-tax Tax Reported
£'000s Adjustment Impact Results Adjustment Impact Results Adjustment Impact Results
Share based payments (2,129) - (2,129) (460) - (460) (2,520) 192 (2,328)
Share based payments - CEO recruitment (38) - (38) (6) - (6) (45) - (45)
Share based payments - CFO recruitment (67) - (67) - - - - - -
CEO recruitment (153) - (153) (147) - (147) (300) - (300)
CFO recruitment - - - (326) - (326) (454) - (454)
Gain on deemed disposal of CSC - - - - - - 2,419 - 2,419
Restructuring (1,305) - (1,305) (1,236) - (1,236) (4,680) - (4,680)
Restructuring - loss on disposal of PPE (1,149) - (1,149) - - - - - -
Restructuring - impairment of PPE (90) - (90) - - - - - -
Total (4,931) - (4,931) (2,175) - (2,175) (5,580) 192 (5,388)
The nature of the adjusted items is as follows:
Current period:
· Share based payments - The charge recorded in accordance with
IFRS 2 'share based payment' of which £710,000 (H1 2023: £153,000 2023:
£840,000) has been classified within cost of sales in gross profit and
£1,419,000 (H1 2023: £307,000, 2023: £1,680,000) in selling, general and
administrative expenses within operating loss. Cash costs defrayed in the
period total £117,000 (H1 2023: £nil 2023: £nil) in respect of employer
social security contributions relating to unapproved employee share options.
Share based payments which arise each financial year are classified as an APM
due to the non-cash charge being partially outside of the Group's control as
it is based on factors such as share price volatility and interest rates which
may be unrelated to the performance of the Group during the period in which
the expense occurred.
· Chief Executive Officer recruitment - The Chief Executive
Officer's starting bonus of £1,000,000, of which £200,000 relates to a
share-based payment award and £800,000 relates to a cash award, is payable
over the first three years of employment. The charge of £38,000 (H1 2023:
£6,000, 2023: £45,000) relates to the share element of the new starter award
and the charge of £153,000 (H1 2023: £153,000, 2023: £345,000) relates to
costs associated with the cash element of the award. Cash costs defrayed in
the period total £nil (H1 2023: £463,000, 2023: £463,000).
· Chief Finance Officer recruitment - The charge of £67,000 (H1
2023: £nil, 2023: £nil) relates to the share-based payment element of the
new Chief Finance Officer's starter award. No other recruitment or severance
costs relating to the change in Chief Finance Officer have been incurred in
the current period with prior year costs relating to external recruitment
costs in relation to newly appointed Chief Finance Officer and settlement
costs and legal fees in relation to the former Chief Financial Officer (H1
2023: £326,000, 2023: £454,000). Cash costs defrayed in the period total
£nil (H1 2023: £280,000, 2023: £454,000).
· Restructuring - The charge of £2,544,000 (H1 2023: £1,236,000,
2023: £4,680,000) relates to the closure of the Group's manufacturing
facility in Pennsylvania, the strategic repurposing of the Group's silicon
site in the UK and final costs and expenses related to the closure of the
Group's Singapore operations:
- Restructuring charges of £2,496,000 (H1 2023: £450,000, 2023:
£3,390,000) consist of employee related costs of £135,000 (H1 2023:
£450,000, 2023: £1,789,000), site decommissioning costs of £1,101,000 (H1
2023: £nil, 2023: £1,601,000) and loss on disposal and impairment of PPE of
£1,260,000 (H1 2023: £nil, 2023: £nil) relating to the announced closure of
the Group's manufacturing facility in Pennsylvania, USA in 2024. The charge
was classified as selling, general and administrative expenses and loss on
disposal of PPE within operating loss. As at 30 June 2024, cumulative
restructuring charges of £7,842,000 (H1 2023 £2,096,000, 2023: £5,346,000)
have been incurred. Cash costs totalling £7,878,000 (H1 2023: £1,136,000,
2023: £4,037,000) has been incurred to date with £3,841,000 (H1 2023:
186,000, 2023: £3,087,000) defrayed in the current period.
- Restructuring charges of £67,000 (H1 2023: £nil, 2023: £nil)
consist of employee related costs of £88,000 (H1 2023: £nil, 2023: £nil)
and profit on disposal of PPE of £21,000 (H1 2023: £nil, 2023: £nil), in
relation to the strategic repurposing of the silicon site in the UK. The
charge was classified as selling, general and administrative expenses and loss
on disposal of PPE within operating loss. Cash costs defrayed in the period
total £88,000 (H1 2023: £nil, 2023: £nil). Proceeds on disposal of PPE in
the period total £851,000 (H1 2023: £nil, 2023: £nil).
- Restructuring charges of £nil (H1 2023: £786,000, FY23:
£1,290,000) relate to labour costs associated with a group wide restructuring
programme and associated employee redundancies (excluding costs relating to
the closure of the group's manufacturing facility in Pennsylvania). The charge
was classified as selling, general and administrative expenses within
operating loss. Cash costs defrayed in the period total £nil (H1 2023:
£786,000 2023: £1,290,000).
- Restructuring credit of £19,000 (H1 2023: £nil, 2023: £nil)
relating to the voluntary liquidation of the Group's Singapore subsidiaries,
where manufacturing operations ceased in June 2022. The credit was classified
as selling, general and administrative expenses within operating loss. Cash
credits in the period total (£19,000) (H1 2023: £nil, 2023: £nil).
Prior periods
· Gain on acquisitions of £nil (H1 2023: £nil, 2023: £2,419,000)
relates to the gain recognised on acquisition of the remaining shares in the
Group's joint venture, CSC, increasing its shareholding to 100%. Cash costs
defrayed in the period relating to deferred consideration in respect of the
acquisition total £128,000 (H1 2023: £nil, 2023: £nil).
The cash impact of adjusted items in the consolidated cash flow statement
represents costs associated with employer social security contributions
relating to unapproved employee share options of £117,000 (H1 2023: £nil
2023: £nil), the recruitment of the group's Chief Executive Officer of £nil
(H1 2023: £463,000, 2023: £463,000), the recruitment and severance of the
group's new and former Chief Finance Officer of £nil (H1 2023: £280,000,
2023: £454,000), payment of employee and site related decommissioning costs
associated with the closure of the Group's site in Pennsylvania of £3,841,000
(H1 2023: £186,000, 2023: £3,087,000), payment of employee related costs
associated with the repurposing of the silicon site in the UK of £88,000 (H1
2023: £nil, 2023: £nil), final net cash receipts of £19,000 (H1 2023:
£nil, 2023: £nil) relating to the voluntary liquidation of the Group's
Singapore subsidiaries following closure of the site in 2022, onerous contract
royalty payments related to the Group's cREO™ technology of £394,000 (H1
2023: £41,000, 2023: £256,000) and payment of employee related costs
associated with labour cost reductions within the Group of £nil (H1 2023:
£786,000, 2023: £1,290,000).
Adjusted EBITDA (adjusted earnings before interest, tax, depreciation and
amortisation) has been calculated as follows:
(All figures £'000s) 6 months to 6 months to 12 months to
30 June 2024 30 June 2023 31 Dec 2023
Unaudited Unaudited Audited
Loss attributable to equity shareholders (15,071) (21,325) (29,378)
Finance costs 1,765 1,832 3,032
Tax 1,168 (141) 567
Depreciation of property, plant and equipment 8,796 6,073 13,186
Depreciation of right of use assets 1,791 1,898 3,790
Impairment of right of use asset 32 - -
Amortisation of intangible fixed assets 3,546 3,750 7,688
Profit on disposal of PPE and intangibles* (55) - (152)
Gain on remeasurement (296) - -
Adjusted Items 4,931 2,175 5,580
Share based payments 2,129 460 2,520
Share based payments - CEO & CFO recruitment 105 6 45
CEO recruitment 153 147 300
CFO recruitment & severance - 326 454
Gain on deemed disposal of JV - - (2,419)
Restructuring 1,305 1,236 4,680
Restructuring - loss on disposal of PPE 1,149 - -
Restructuring - impairment of PPE 90 - -
Adjusted EBITDA 6,607 (5,738) 4,313
Share based payments (2,129) (460) (2,520)
Share based payments - CEO & CFO recruitment (105) (6) (45)
CEO recruitment (153) (147) (300)
CFO recruitment & severance - (326) (454)
Gain on deemed disposal of JV - - 2,419
Restructuring (1,305) (1,236) (4,680)
EBITDA 2,915 (7,913) (1,267)
* Excludes the adjustment 'Restructuring - loss on disposal of PPE' which is
separately disclosed as part of the groups adjusted items
9. TAXATION
The Group's consolidated effective tax rate for the six months ended 30 June
2024 was 8.4% (H1 2023: 0.7%, 2023: 2.0%). The effective tax rate differs from
the theoretical amount that would arise from applying the standard corporation
tax in the UK of 25.0% (H1 2023: 19.0%, 2023: 23.5%) principally due to
non-recognition of current year tax losses in the UK and USA.
10. LOSS PER SHARE
(All figures £'000s) 6 months to 6 months to 12 months to
30 June 2024 30 June 2023 31 Dec 2023
Unaudited Unaudited Audited
Loss attributable to ordinary shareholders (15,071) (21,325) (29,378)
Adjustments to loss after tax (note 8) 4,931 2,175 5,388
Adjusted loss attributable to ordinary shareholders (10,140) (19,150) (23,990)
Number of shares:
Weighted average number of ordinary shares 961,679,720 830,940,409 896,744,318
Dilutive share options 8,031,368 4,621,705 10,155,464
969,711,088 835,562,114 906,899,782
Basic loss per share (1.57p) (2.57p) (3.28p)
Adjusted loss per share (1.05p) (2.30p) (2.68p)
Diluted loss per share (1.57p) (2.57p) (3.28p)
Adjusted diluted loss per share (1.05p) (2.30p) (2.68p)
Basic loss per share is calculated by dividing the loss attributable to
ordinary shareholders by the weighted average number of ordinary shares during
the period.
Diluted loss per share is calculated by dividing the loss attributable to
ordinary shareholders by the weighted average number of shares and 'in the
money' share options in issue. Share options are classified as 'in the money'
if their exercise price is lower than the average share price for the period.
As required by IAS 33, this calculation assumes that the proceeds receivable
from the exercise of 'in the money' options would be used to purchase shares
in the open market in order to reduce the number of new shares that would need
to be issued.
11. CASH GENERATED FROM OPERATIONS
(All figures £'000s) 6 months to 6 months to 12 months to
30 June 2024 30 June 2023 31 Dec 2023
Unaudited Unaudited Audited
Loss before tax (13,903) (21,466) (28,811)
Finance costs 1,765 1,832 3,032
Depreciation of property, plant and equipment 8,796 6,073 13,186
Impairment of property, plant and equipment 90 - -
Depreciation of right of use assets 1,791 1,898 3,790
Impairment of right of use assets 32 - -
Amortisation of intangible assets 3,546 3,750 7,688
Inventory provision write downs 469 760 522
Non-cash movement on trade receivable expected credit losses 31 (355) (1,808)
Non-cash provision movements 143 404 1,599
Fair value gain on derivative financial instruments - (640) -
Gain on deemed disposal of JV - - (2,419)
Loss/(profit) on disposal of property, plant and equipment 1,094 - (152)
Gain on remeasurement of right of use asset (296) - -
Share based payments 2,234 466 2,565
Cash inflow from operations before changes in working capital 5,792 (7,278) (808)
(Increase)/decrease in inventories (1,345) 5,946 7,503
(Increase)/decrease in trade and other receivables (9,315) 7,185 6,601
Increase/(decrease) in trade and other payables 4,566 (3,043) (1,760)
Decrease in provisions (2,330) (378) (1,462)
Cash inflow from operations (2,632) 2,432 10,074
12. ANALYSIS OF NET DEBT
(All figures £'000s)
6 months to 6 months to 12 months to
30 June 2024 30 June 2023 31 Dec 2023
Unaudited Unaudited Audited
Bank borrowings due after one year (23,220) (845) (3,692)
Bank borrowings due within one year (1,569) (6,123) (4,153)
Lease liabilities due after one year (44,493) (42,826) (40,435)
Lease liabilities due within one year (7,329) (7,140) (5,865)
Total borrowings (76,611) (56,934) (54,145)
Fair value of derivative financial instruments - 259 -
Cash and cash equivalents 7,810 12,314 5,617
Net debt (68,801) (44,361) (48,528)
On 17 May 2023, the Company refinanced its £27,300,000 ($35,000,000)
multi-currency revolving credit facility, provided by HSBC Bank plc. The
facility is secured on the assets of IQE plc and its subsidiary companies with
a committed term to 1 May 2026. Interest on the facility is payable at a
margin of between 2.50 and 3.50 per cent per annum over SONIA on any drawn
balances and the facility is subject to quarterly leverage and Interest cover
covenants tests. The facility was £23,220,000 (H1 2023 £nil, 2023:
£3,937,000) utilised at 30 June 2024.
On 29 August 2019, the Company agreed a new £30,000,000 asset finance
facility, provided by HSBC Bank plc that is secured over various plant and
machinery assets. The facility has a five-year term and an interest rate
margin of 1.65% per annum over base rate on any drawn balances.
The Group's bank facilities provided by HSBC Bank plc are subject to certain
leverage and interest cover financial covenants. The Group has complied with
all the financial covenants of its borrowing facilities during 2024 and 2023.
Bank borrowings relate to amounts drawn down on the Group's multi-currency
revolving credit and asset finance facilities.
Cash and cash equivalents comprise balances held in instant access bank
accounts and other short-term deposits with a maturity of less than 3 months.
13. SHARE CAPITAL
6 months to 6 months to 12 months to
Number of shares 30 June 2024 30 June 2023 31 Dec 2023
Unaudited Unaudited Audited
As at 1 January 961,518,692 804,841,965 804,841,965
Employee share schemes 5,114,245 1,052,260 1,183,997
Placing - 150,000,000 150,000,000
Retail Offer - 5,492,730 5,492,730
As at 30 June / 31 December 966,632,937 961,386,955 961,518,692
6 months to 6 months to 12 months to
(All figures £'000s) 30 June 2024 30 June 2023 31 Dec 2023
Unaudited Unaudited Audited
As at 1 January 9,615 8,048 8,048
Employee share schemes 51 11 12
Placing - 1,500 1,500
Retail Offer - 55 55
As at 30 June / 31 December 9,666 9,614 9,615
On 17 May 2023, IQE plc raised funds by way of a Placing and a Retail Offer to
all existing shareholders. In each case these were offered at an issue price
of 20 pence per share (the 'Issue Price'). The Placing utilised a cashbox
structure and therefore the premium on the ordinary shares and associated
costs, in accordance with section 612 of the Companies Act 2006, were
initially recognised within the merger reserve (incorporated within 'Other
reserves'). The investment in the newly incorporated subsidiary utilised
within the cashbox structure was dissolved in the year ended 31 December 2023
and the merger reserve was subsequently transferred into retained earnings as
it was determined to be distributable in accordance with the Companies Act
2006. The Placing and Retail Offer raised net funds of £29,708,000 from the
issue of 155,492,730 ordinary shares.
14. COMMITMENTS
The Group had capital commitments at 30 June 2024 of £452,000 (H1 2023:
£12,197,000, 2023: £553,000).
RESPONSIBILITY STATEMENT
We confirm that to the best of our knowledge:
· the condensed set of financial statements has been prepared in
accordance with IAS 34 Interim Financial Reporting as adopted for use in the
UK;
· the interim management report includes a fair review of the
information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an
indication of important events that have occurred during the first six months
of the financial year and their impact on the condensed set of financial
statements; and a description of the principal risks and uncertainties for the
remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being
related party transactions that have taken place in the first six months of
the current financial year and that have materially affected the financial
position or performance of the entity during that period; and any changes in
the related party transactions described in the last annual report that could
do so.
Americo Lemos Jutta Meier
Chief Executive Officer, IQE plc. Chief Financial Officer, IQE plc.
9 September 2024 9 September 2024
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