2020 Q1 Financial Results Affected by Coronavirus Pandemic
April 30, 2020, Laguna, Philippines — Integrated Micro-Electronics, Inc. (IMI) booked US$256 million of revenue in the first quarter of 2020 as it manages global fallout from the COVID-19 outbreak. Despite operational headwinds, IMI continues to extend various employee assistance programs amidst quarantine protocols in a number of its operating sites. The situation led to lower gross profit results at US$19.5 million with a 7.6% gross margin, a decline from 9.0% in the same period last year. IMI global management teams have been able to partly mitigate the negative financial impact by controlling overhead costs, reducing raw material expenses, and securing ongoing support from various governments including Bulgaria, China, Czech Republic, Germany, Serbia and Singapore. The company ends the quarter with a net loss of US$4.6 million.
IMI’s wholly owned businesses declined to US$209 million of revenues, a 19 percent reduction from last year. Hampered by government mandated shutdowns of its Chinese facilities in February, and the Enhanced Community Quarantine protocols in the Philippines that began in mid-March, revenues from its Asian operating units were reduced by 20 percent to US$105 million. Operating sites in Europe and North America, on the other hand, remained fully operational throughout the first quarter, but declined 15% in revenues as they contended with market disruptions in the global supply chain.
Via Optronics and STI, Ltd. produced combined revenues of US$47 million, a decline of 27 percent from 2019. Both subsidiaries faced near-term headwinds in their regions, particularly VIA’s extended shutdown of its main operating plant in Suzhou, China.
While the overall market environment is challenging, IMI is pursuing additional business opportunities, particularly in the medical and telecommunications segments. Since successfully returning to full operational capacity in early March, IMI’s operating sites in China have seen growth in demand for products used in medical equipment and 5G telecom infrastructure. STI, Ltd. has also started producing components used in medical ventilators as part of the Ventilator Challenge UK. The recent rise in work from home arrangements is expected lead to an uptick in demand for Via Optronics’ display solutions in the laptop segment.
Arthur Tan, IMI’s chief executive officer, said “IMI’s robust business continuity protocols allow us to smoothly adapt our operations to current circumstances while ensuring the health and safety of our employees. The company’s wide geographical footprint gives us the flexibility to shift and address demands across all our regions as the pandemic situation continues to affect global markets. With our experience in high quality manufacturing, we are able to serve current demands in the medical and telecom segments that are critical during this outbreak. Despite these turbulent times, we firmly believe that the strategies we set forth in building towards a sustainable, interconnected future continue to be very relevant.”
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 manufacturing solutions expert in the world. IMI ranks among the top 20 EMS providers in the world by the Manufacturing Market Insider, based on 2019 revenues. In the automotive market, it is the 5th 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.
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