IMI H1 profit dips 1.5% on weak China sales

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THE electronics and semiconductor manufacturer, Integrated Micro-Electronics Inc., (IMI) saw its net income dip 1.5 percent to $15 million (P701 million) in the January to June period this year on weaker sales of its China operations.

In a disclosure to the Philippine Stock Exchange, the company said its China operations reported a 10.7 percent drop in first-half revenue to $130.4 million due to the weak performance of the consumer electronics lines.

But revenues from Europe and Mexico were stronger, improving 11.5 percent to $153.4 million in the first half amid strong demand for automotive body control and lighting systems that IMI assembles in Bulgaria and the Czech Republic.

Revenue from its EMS operations in the Philippines was flat at $109.6 million, as weak performance from its storage device business offset gains in the manufacture of automotive cameras, security and access controls, asset tag sensors, and lighting controls.


Overall revenue in the first half slipped by 1.58 percent to $409.7 million (P19.4 billion) from $416.3 million in the same period last year.

However, its operating income grew 19 percent year-on-year to $20.7 million (P966.7 million) boosted by its focus on high-margin product segments, continuous improvement in operations, and disciplined cost management.

“The improvement in operating income came about as we expanded business in higher-margin segments of automotive and industrial. Line productivity and cost-saving programs also had a positive impact,” IMI president and chief operating officer Gilles Bernard said.

Capital spending reached $23.2 million in the first half, mainly for Mexico, Bulgaria, China and the Philippines to support line expansion.

It said production volume ramp-up in the automotive and industrial lines will commence in the fourth quarter of the year.

“The relentless rise in technology innovations is giving businesses speed and agility, and driving performance to ensure business success. We are optimistic that IMI has what it takes to remain relevant and on top of tech developments and trends down the road,” IMI chief executive officer Arthur Tan said.

Established in 1980, IMI is an Ayala Corp. subsidiary engaged in the business of manufacturing semiconductors and electronic devices. About a quarter of its revenues comes from its Philippine operations while the rest are from its international units in China and Singapore and its operations in Europe and Mexico.

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