1st Half Hampered by Plant Shutdowns due to Pandemic
July 30, 2020, Laguna, Philippines — Integrated Micro-Electronics, Inc. (IMI) booked US$476 million of first half revenue in 2020 as plant shutdowns in various operating regions significantly affected financial results. Facilities in the Philippines, China, and Mexico all adhered to government mandated lockdowns to contain the spread of COVID-19. The global situation led to a 25% year-on-year reduction in top line sales while margins are likewise challenged with gross profit at US$30.5 million equating to a 6.4% margin. Reduction of overhead costs by approximately US$10 million through streamlining initiatives and government incentives helped mitigate the effects of the extended market softness. The addition of one-time inventory provisions totaling around US$3 million increased the total net loss to US$21.5 million in the first half of this year.
Arthur Tan, IMI’s president and chief executive officer, said “IMI has endured through several major crises in our 40-year history. Our battle-hardened organization has built IMI for long-term success. Challenging market environments bring opportunity to those who come prepared. IMI’s flexibility and expertise in providing the best quality technology solutions will allow us to emerge stronger than we were before.”
IMI’s wholly owned businesses declined to US$367 million of revenues, a 28% slide from last year. While some operating regions faced mandatory lockdowns, operating sites in Bulgaria and Czech Republic aligned with the demand slowdown of OEM customers by exercising voluntary reduced work schedules. As the automotive market outlook remains weak in the short term, IMI’s wide product portfolio has captured the increased demand from the consumer, industrial, medical, and telecom sectors.
Via Optronics and STI, Ltd. booked combined revenues of US$109 million for the period. In time for the uptick in global laptop demand, Via’s LCD supply chain issues were resolved in the second quarter, helping the subsidiary rebound with a 47% quarter-on-quarter improvement in top line sales. STI, on the other hand, faced continued demand slowdown as government pandemic response programs are prioritized over aerospace and defense projects.
“IMI expects a steady improvement in the second half of the year as revised customer forecasts indicate a better recovery than initially expected. The project pipeline continues to be active with US$175 million of new business wins despite the business constraints brought about by the pandemic,” Tan added.
Integrated Micro-Electronics, Inc. (IMI), the manufacturing arm of AC Industrial Technology Holdings, Inc., a wholly-owned subsidiary of Ayala Corporation, is among the leading global technology and manufacturing solutions expert in the world. IMI ranks among the top 20 in the list of top 50 EMS providers in the world by the Manufacturing Market Insider, based on 2019 revenues. In the automotive market, it is the 6th largest EMS provider in the world per New Venture Research.
IMI specializes in highly reliable and quality electronics for long product life cycle segments such as automotive, industrial electronics and more recently, the aerospace market.
From its 22 manufacturing plants across ten different countries, IMI provides engineering, manufacturing, and support and fulfillment capabilities to diverse industries globally.
For more information, visit www.global-imi.com.