TIDMIQE
IQE plc
("IQE" or the "Group")
2020 FULL YEAR RESULTS
Cardiff, UK
25 March 2021
Record revenue of GBP178m underpinned by the start of the 5G mega-cycle
IQE plc (AIM: IQE), the leading supplier of advanced wafer products and
material solutions to the semiconductor industry, announces its full
year results for the year ended 31 December 2020.
2020 Financials
FY 2020 FY 2019
GBP'm* GBP'm* Change (%)
Revenue 178.0 140.0 27.1
Adjusted EBITDA 30.1 16.2 85.8
Operating loss (5.5) (18.8)
Adjusted operating profit/loss 5.4 (4.7)
Reported loss after tax (2.9) (35.1)
Adjusted diluted EPS(p) 0.29p (2.46p)
Net cash generated from operations 35.5 8.9 298.9
Adjusted cash flow from operations 36.3 16.5 120.0
Capital investment (PP&E) 5.0 31.9 (84.3)
Net cash/(debt)** 1.9 (16.0)
* All figures GBP'm excluding adjusted diluted EPS.
** Net (debt) / funds excludes IFRS16 lease liabilities.
Adjusted Measures: The Directors believe that the adjusted measures
provide a more useful comparison of business trends and performance.
Adjusted measures exclude certain non-cash items, non-operational items
and significant infrequent items that would distort period on period
comparability. The following highlights of the full year results is
based on these adjusted profit measures, unless otherwise stated.
Financial Summary
-- Record revenue performance of GBP178.0m (FY 2019: GBP140.0m) representing
27% YoY revenue growth driven by the start of the 5G mega-cycle
-- Wireless revenue of GBP94.2m (FY 2019: GBP68.2m) representing 38%
YoY growth, driven by 5G infrastructure deployments in Asia, in
particular GaN on SiC for mMIMO base stations and 5G handset
market penetration, where there has been an increase in GaAs
content versus 4G phones
-- Photonics revenue of GBP81.6m (FY 2019: GBP69.8m) representing 17%
YoY growth, driven by continued growth in 3D Sensing and other
advanced sensing applications, in particular epiwafers for Direct
Time-of-Flight (DToF) camera modules that are enabling augmented
reality
-- Foreign exchange headwind of GBP0.5m (constant currency USD
revenue growth of 27.5% YoY)
-- Net cashflow from operations of GBP35.5m (FY 2019: GBP8.9m) resulting
from the strong trading performance, capital spending controls and
working capital management, leading to a net cash position (excluding
lease liabilities) of GBP1.9m as at 31 December 2020 (FY 2019: net debt
of GBP16m)
-- Increase in profitability with an adjusted operating profit of GBP5.4m
(FY 2019: GBP(4.7m) loss) as a result of revenue growth and the benefits
of high operational gearing
-- Reported operating loss of GBP(5.5)m (FY 2019: GBP(18.8)m) as a result of
exceptional impairment charges and legal costs reported at the half year,
offset by the proceeds from the settlement of a legal dispute resolved in
IQE's favour
-- Capital expenditure reduced to GBP5.0m on PP&E (FY 2019: GBP31.9m)
following the completion of the infrastructure phase of the Group's
capacity expansion in 2018 and 2019
Strategic and Operational Highlights
-- Business continuity maintained at all global sites during the COVID-19
pandemic with no interruptions to production
-- Consolidation of US MBE manufacturing activities at North Carolina site
by 2024, with transition underway
-- Acquisition of the 10% minority interest in IQE's Taiwanese subsidiary,
subject to an ongoing statutory Court process regarding valuation
-- Settlement in IQE's favour in a multifaceted intellectual property legal
dispute, resulting in $2.5m cash being received in February 2021
-- Three new Aixtron G4 tools ordered in Q1 2021 to support volume growth
for Wireless GaAs in Taiwan
-- Strong progress in new product development including IQepiMo(TM) template
technology for RF Filters, IQGeVCSEL 150(TM) technology for 6" VCSELs on
Germanium (Ge), a critical step in the pathway to 8" VCSEL technology,
and post year end IQDN-VCSEL(TM) technology for advanced sensing
applications at longer wavelengths on 150 mm GaAs substrates
-- The search for a new CEO who will lead IQE during the next phase of its
growth is ongoing. The appointment of a new CEO will facilitate Drew
Nelson's transition to becoming a board member with the title of
President.
Dr Drew Nelson, Chief Executive Officer of IQE, said:
"2020 was a year unlike any other and I'd like to extend my thanks to
all of our staff who have shown their commitment and resilience in
rising to the challenges we faced. Despite the global uncertainty that
we encountered, the strength and diversification of our business enabled
us to deliver record revenues of GBP178m, representing a 27%
year-on-year increase.
At the same time, we have made positive progress against our strategy
and recorded strong growth across our Wireless and Photonics divisions,
despite the external pressures.
This progress, combined with the return to a cash positive position and
the range of unique materials solutions for high performance devices in
our development pipeline, ensures we are well placed to maintain our
leadership position as the 5G mega-cycle gathers pace in the coming
years".
Current trading and H1 2021 outlook
After a consistently strong year in 2020 across IQE's broad portfolio of
products, trading has continued positively in 2021. In particular,
revenues for Wireless GaAs epiwafers are strong as a result of continued
5G handset market penetration and increased GaAs content. In addition,
demand for 3D sensing, advanced sensing applications and communications
products continues to remain positive.
IQE is well positioned for further 5G related GaN on SiC growth over the
multi-year replacement cycle. In the first half of FY21, revenues of GaN
on SiC are expected to be lower than in H1 FY20 amid lower market
estimates for mMIMO deployment in Asia. Beyond the near term, the
opportunities for this and other GaN on Si technologies are very strong
as global roll outs of 5G gather pace.
The Group is experiencing a foreign exchange headwind in FY 21 on a
reported basis, as the Group's revenues are predominantly earned in USD
but are reported in GBP.
The Group expects revenue and Adjusted EBITDA in the first half of 2021
to be similar to H1 FY20 on a constant currency basis.
Capital expenditure on PP&E for FY21 is expected to be in the range of
GBP20m to GBP30m as the Group resumes investment in capacity for
specific growth platforms, including three new reactors for Taiwan to
underpin further growth in FY22. Capitalisation of development costs are
expected to be in the range of GBP7m to GBP10m for the full year as the
Group continues to invest in future products to meet anticipated growing
demand for compound semiconductors driven by the macro trends of 5G and
connected devices.
Contacts:
IQE plc
+44 (0) 29 2083 9400
Drew Nelson
Tim Pullen
Amy Barlow
Peel Hunt LLP (Nomad and Joint Broker)
+44 (0) 20 7418 8900
Edward Knight
Paul Gillam
Nick Prowting
Citigroup Global Markets Limited (Joint Broker)
+44 (0) 20 7986 4000
Christopher Wren
Peter Catterall
Headland Consultancy (Financial PR)
Andy Rivett-Carnac: +44 (0) 7968 997 365
Chloe Francklin: +44 (0)78 3497 4624
Glossary
GaAs Gallium Arsenide
----- ----------------------------------------------
GaN Gallium Nitride
----- ----------------------------------------------
mMIMO Massive MIMO (Multiple-Input, Multiple Output)
----- ----------------------------------------------
SiC Silicon Carbide
----- ----------------------------------------------
VCSEL Vertical Cavity Surface Emitting Laser
----- ----------------------------------------------
ABOUT IQE
https://www.globenewswire.com/Tracker?data=_42kLlOWgbvlRT6_P8Rh4ndARULEVTZVCtGhVzL1fVv5YMRgC7KK-YXjbfBiFUq19hu7A5ZnKd7vwS1nE2M1kRn1kStCcR1iBsyrA35YgpsS25jnth-kLr_5hxfYzM4MzbqnCagB7fFpq5YY7qtZRRQZT4dCIzbiGkNIVQK0_AzFuhsXmSEc9fKOx3WNwK50eAqldswl4E0MKXyszZFvZm-T_8hWrr9cBzpeaE9Wt5Y=
http://iqep.com
IQE is the leading global supplier of advanced compound semiconductor
wafers and materials solutions that enable a diverse range of
applications across:
-- handset devices
-- global telecoms infrastructure
-- connected devices
-- 3D sensing
As a scaled global epitaxy wafer manufacturer, IQE is uniquely
positioned in a market which has high barriers to entry. IQE supplies
the whole market and is agnostic as to the winners and losers 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 c. 650 employees across nine
manufacturing locations in the UK, US, Taiwan and Singapore, and is
listed on the AIM Stock Exchange in London.
Financial Review
The Group reports financial performance in accordance with International
Financial Reporting Standards adopted by the European Union ('IFRS') and
provides disclosure of additional alternative non IFRS GAAP performance
measures to provide further understanding of financial performance.
Details of the alternative performance measures used by the Group
including a reconciliation to reported IFRS GAAP performance measures is
set out in note 5 to the financial statements.
On 11 March 2020, the World Health Organisation declared the outbreak of
a coronavirus (COVID-19) a pandemic. The COVID-19 outbreak created
uncertainty in global economies and posed a number of initial risks and
uncertainties in the markets in which the Group operates although
ultimately these have not adversely impacted financial performance
during the year with strong global growth trends in compound
semiconductor markets continuing and the Group experiencing little or no
disruption to its manufacturing operations as a result of the pandemic.
The Group's trading has remained resilient throughout the year with
significant growth experienced in a number of markets that has resulted
in the delivery of record revenue of GBP178.0m (2019: GBP140.0m) with
strong growth experienced in each of the Group's primary business
segments.
The Group's Wireless business segment represents the largest proportion
of the Group's revenue accounting for 52.9% (2019: 48.7%) of total wafer
sales with Photonics representing 45.8% (2019: 49.8%) and CMOSS++
representing 1.2% (2019: 1.5%).
Wireless wafer revenues increased 38.2% to GBP94.2m (2019: GBP68.2m).
The increase in Wireless revenue primarily reflects increased demand for
GaAs wafers for 5G handset power amplifiers fuelled by growing end
market demand for '5G ready' smartphones, increased demand for GaN on
SiC wafers for 5G infrastructure related to initial deployments of 5G
base stations and demand for high performance GaN on SiC wafers for
advanced RF applications.
Photonics wafer revenues were up 17.0% to GBP81.6m (2019: GBP69.8m) with
the Group experiencing consistently high demand for GaAs VCSEL wafers
for 3D sensing applications throughout the year and continuing strong
demand for high performance GaSb wafers for advanced sensing
applications.
Gross profit increased from GBP21.4m to GBP33.2m. The increase in gross
profit reflects a combination of higher trading volumes and an
improvement in overall gross profit margin percentage to 18.6% (2019:
15.3%) as the Group has benefited from greater capacity utilisation in
the current year. Adjusted gross profit, which excludes the charge for
share based payments, increased from GBP20.9m to GBP33.3m with a gross
margin improvement from 14.9% to 18.7%.
Selling, general and administrative ('SG&A') expenses decreased from
GBP36.3m to GBP34.7m. Adjusted SG&A, which excludes adjustments for
share based payments, restructuring costs, patent dispute legal costs
and certain non-current asset impairments increased from GBP25.8m to
GBP27.8m primarily reflecting an increase in investment in corporate
functions and employee headcount as the Group continues to grow.
Restructuring costs totalling GBP0.16m (2019: GBP0.81m) relate to
employee retention bonuses associated with the announced closure of the
Group's manufacturing facility in Pennsylvania (US). Restructuring costs
in 2019 related to site-specific employee related restructuring and
final costs associated with the closure of the Group's manufacturing
facility in New Jersey (US).
Patent dispute income of GBP1.7m (2019: GBP4.3m cost) relates to a
settlement agreement associated with legal costs incurred by the Group
that has been negotiated with the plaintiff following the previously
announced arbitration panel ruling in favour of the Group. Patent
dispute income also includes insurance income received from the Group's
insurers in relation to relevant costs incurred as part of the dispute
partially offset by actual legal costs incurred during the period.
Impairment of intangibles of GBP6.5m (2019: GBP3.8m) relates to the
write-down in value of the Group's non-filter related cREO(TM) patent
and development costs following the refocus of resource and investment
into cREO(TM) filter related development activities. The onerous
contract provision of GBP1.8m (2019: GBPnil), which is linked to the
commercial applications of the cREO(TM) technology and represents the
cost of minimum guaranteed future royalty payments related to the
historical acquisition of the technology from Translucent Inc. that are
payable in the period prior to the expected commercial exploitation of
the cREO(TM) filter technology.
Operating loss improved from GBP18.8m in 2019 to a current year loss of
GBP5.5m. Reflecting the adjustments noted above, adjusted operating loss
of GBP4.7m in 2019 improved significantly in 2020 with a return to
profitability and an adjusted operating profit of GBP5.4m. The segmental
analysis in note 3 reflects the adjusted operating margins for the
primary segments (before central corporate support costs). Wireless
adjusted operating margins and photonics operating margins improved from
9.7% and 1.9% in 2019 to 12.1% and 11.1% in 2020, primarily reflecting
increases in volume and increased utilisation of manufacturing capacity.
The credit of GBP3.8m (2019: GBP4.7m charge) associated with the Group's
share of losses in its joint venture, Compound Semiconductor Centre
Limited, reflects the reversal of previously recognised losses as part
of the application of the loss absorption requirement of IAS28.38
following an equal and opposite increase in the level of impairment loss
associated with the Group's preference share debt due from CSC. The loss
absorption credit of GBP3.8m recorded in 'share of losses in joint
venture' and the increased impairment charge of GBP3.8m relating to the
preference share financial asset recorded as an 'impairment loss on
financial assets' has no net impact on the Group's loss for the year.
Finance costs increased to GBP2.2m from GBP1.5m in 2019 reflecting a
combination of the Group's utilisation of its bank borrowing facilities
and the unwind of discounting associated with lease liabilities.
The tax credit of GBP1.0m (2019: GBP10.2m charge) reflects an effective
tax rate of 25% with the credit principally arising as a result of the
recognition of deferred tax assets for certain current year UK trading
losses. The tax charge of GBP10.2m in 2019 primarily reflected increased
deferred tax charges relating to the partial reversal of previously
recognised US deferred tax assets. A forecast shift in the balance of
the Group's projected manufacturing production, a position that remains
unchanged in the current year, resulted in a shift in forecast profits
between the US and rest of the world. The forecast shift in
manufacturing and profitability in the US has restricted the Group's
ability to recognise deferred tax assets for historical US trading
losses and in 2019 resulted in the partial reversal of previously
recognised US deferred tax assets with a tax impact of GBP9.6m. The
effective tax rate of 21% (2019: 10%) applicable to the tax charge of
GBP1.5m (2019: GBP1.8m) on adjusted items is reflective of applicable
statutory tax rates.
The reduction in the loss for the year to GBP2.9m (2019: GBP35.1m)
reflects a combination of significant growth in the wireless and
photonics business segments, improved profitability within both business
segments and a reduction in the impact of adjusted non-cash and other
non-operational items which at an adjusted level, has resulted in a
return to profitability, with an adjusted profit for the year of GBP2.7m
(2019: GBP19.0m loss).
Basic and diluted loss per share has improved from a loss per share of
4.51p to a loss of 0.41p in the current year with adjusted basic
earnings per share of 0.29p (2019: 2.46p loss) and adjusted diluted
earnings per share of 0.29p (2019: 2.46p loss) reflecting the Group's
return to profitability at the adjusted profit level.
Cash generated from operating activities increased significantly in the
year to GBP33.3m (2019: GBP8.1m) reflecting the Group's positive
underlying trading performance and careful management of working
capital. This increase in cash generation combined with a reduction in
capital expenditure and technology development costs has reduced cash
expenditure on investing activities from GBP41.8m to GBP11.8m and
resulted in a significant strengthening in the Group's balance sheet
position with a full year net funds position of GBP1.9m (excluding lease
liabilities) compared to a net debt position of GBP156.0m (excluding
lease liabilities) in 2019.
Cash expenditure as part of investing activities includes GBP1.4m of
cash cost associated with the acquisition of the minority interest in
the Group's Taiwanese subsidiary, IQE Taiwan ROC. On 5 October 2020, the
group acquired the remaining 9.82% of issued shares held by third party
minority shareholders in its subsidiary, IQE Taiwan ROC, taking its
equity ownership from 90.18% to 100.00%. The acquisition was affected
using a statutory share swap arrangement under Taiwan's Business Mergers
and Acquisition Law with the final total consideration payable to be
determined by the Taiwan Court. Consideration paid to date consists of
GBP1.4m which has been settled via the issuance of 2,606,689 ordinary
shares in IQE plc and cash consideration of GBP1.4m which for a minority
of selling shareholders is subject to adjustment dependent upon a price
determined by the Taiwan Court.
Equity shareholder funds totals GBP260.4m (2019: GBP270.4m) with the
movement from 2019 primarily reflecting the loss for the year, the
impact of the acquisition of the Taiwanese minority interest and adverse
foreign exchange differences arising on the retranslation of net
investments in overseas subsidiaries.
Financial Summary
2020 2019
GBP'000 GBP'000
Revenue 178,016 140,015
Adjusted EBITDA (see below) 30,101 16,246
Operating (loss) / profit
--Adjusted* 5,386 (4,676)
--Reported (5,517) (18,802)
(Loss) / profit after tax
--Adjusted* 2,702 (19,010)
--Reported (2,893) (35,128)
Net cash flow from operations
Before adjustments (note 4) 36,324 16,530
Reported 35,457 8,948
Free cash flow**
Before exceptional cash flows 23,566 (25,445)
Reported 22,699 (33,027)
Net (debt)/cash excluding lease liabilities*** 1,923 (15,970)
Equity shareholders' funds 260,435 266,593
Basic EPS -- adjusted**** 0.29p (2.46p)
Basic EPS -- unadjusted (0.41p) (4.51p)
Diluted EPS -- adjusted**** 0.29p (2.46p)
Diluted EPS -- unadjusted (0.41p) (4.51p)
----------------------------------------------- --------- ---------
Consolidated income statement for the year ended 31 December 2020
2020 2019
GBP'000 GBP'000
------------------------------------------------------- --------- ---------
Revenue 178,016 140,015
Cost of sales (144,866) (118,631)
-------------------------------------------------------- --------- ---------
Gross profit 33,150 21,384
Selling, general and administrative expenses (34,697) (36,297)
Impairment loss on financial assets (3,788) (4,134)
Profit on disposal of property, plant and equipment (182) 245
-------------------------------------------------------- --------- ---------
Operating loss (5,517) (18,802)
Finance costs (2,165) (1,458)
Reversal / share of losses of joint ventures accounted
for using the equity method 3,788 (4,688)
Adjusted profit / (loss) before income tax 3,221 (7,019)
Adjustments (7,115) (17,929)
-------------------------------------------------------- --------- ---------
Loss before income tax (3,894) (24,948)
Taxation 1,001 (10,180)
Loss for the year (2,893) (35,128)
-------------------------------------------------------- --------- ---------
Loss attributable to:
Equity shareholders (3,271) (35,473)
Non-controlling interest 378 345
-------------------------------------------------------- --------- ---------
(2,893) (35,128)
-------------------------------------------------------- --------- ---------
Loss per share attributable to owners of the parent
during the year
Basic loss per share (0.41p) (4.51p)
Diluted loss earnings per share (0.41p) (4.51p)
-------------------------------------------------------- --------- ---------
Adjusted basic and diluted loss per share are presented in note 5.
All items included in the loss for the year relate to continuing
operations.
Non-controlling interest relates to minority shareholder interests in
the Group's subsidiary, IQE Taiwan ROC, prior to the acquisition of the
minority shareholding on 5 October 2020.
Consolidated statement of comprehensive income for the year ended 31
December 2020
2020 2019
GBP'000 GBP'000
----------------------------------------------------- --------- ---------
Loss for the year (2,893) (35,128)
Exchange differences on translation of foreign
operations* (6,104) (3,654)
Total comprehensive expense for the year (8,997) (38,782)
------------------------------------------------------ --------- ---------
Total comprehensive expense attributable to:
Equity shareholders (9,482) (39,084)
Non-controlling interest 485 302
------------------------------------------------------ --------- ---------
(8,997) (38,782)
----------------------------------------------------- --------- ---------
* Items that may be subsequently be reclassified to profit or loss.
Items in the statement above are disclosed net of tax.
Consolidated balance sheet as at 31 December 2020
2020 2019
GBP'000 GBP'000
----------------------------------------------------- --------- ---------
Non-current assets
Intangible assets 105,772 118,456
Fixed asset investments - 75
Property, plant and equipment 126,229 136,482
Right of use assets 37,339 39,355
Deferred tax assets 7,821 5,679
Other financial assets - -
----------------------------------------------------- --------- ---------
Total non-current assets 277,161 300,047
------------------------------------------------------ --------- ---------
Current assets
Inventories 30,887 30,668
Trade and other receivables 38,575 33,065
Cash and cash equivalents 24,663 8,800
------------------------------------------------------ --------- ---------
Total current assets 94,125 72,533
------------------------------------------------------ --------- ---------
Total assets 371,286 372,580
------------------------------------------------------ --------- ---------
Current liabilities
Trade and other payables (35,605) (26,367)
Current tax liabilities (1,426) (1,162)
Bank borrowings (6,201) (2,034)
Lease liabilities (4,798) (3,083)
Provisions for other liabilities and charges (515) -
------------------------------------------------------ --------- ---------
Total current liabilities (48,545) (32,646)
------------------------------------------------------ --------- ---------
Non-current liabilities
Bank borrowings (16,539) (22,736)
Lease liabilities (42,226) (44,895)
Deferred tax liabilities (2,054) (1,860)
Provisions for other liabilities and charges (1,487) -
------------------------------------------------------ --------- ---------
Total non-current liabilities (62,306) (69,491)
------------------------------------------------------ --------- ---------
Total liabilities (110,851) (102,137)
------------------------------------------------------ --------- ---------
Net assets 260,435 270,443
------------------------------------------------------ --------- ---------
Equity attributable to the shareholders of the parent
Share capital 8,004 7,961
Share premium 154,185 152,385
Retained earnings 62,089 63,826
Exchange rate reserve 21,291 27,502
Other reserves 14,866 14,919
260,435 266,593
Non-controlling interest - 3,850
------------------------------------------------------ --------- ---------
Total equity 260,435 270,443
------------------------------------------------------ --------- ---------
Consolidated statement of changes in equity for the year ended 31
December 2020
Exchange
Share Share Retained Rate Other Non-controlling Total
capital premium earnings reserve reserves interests equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ ------- ------- -------- -------- -------- --------------- -------
At 1 January 2020 7,961 152,385 63,826 27,502 14,919 3,850 270,443
------------------------ ------- ------- -------- -------- -------- --------------- -------
Comprehensive expense
(Loss) / profit for the
year - - (3,271) - - 378 (2,893)
Other comprehensive
expense for the year - - - (6,211) - 107 (6,104)
Total comprehensive
expense for the year - - (3,271) (6,211) - 485 (8,997)
Transactions with owners
Share based payments - - - - 55 - 55
Tax relating to share
options - - - - 57 - 57
Proceeds from shares
issued 17 388 - - (165) - 240
Acquisition of
non-controlling
interest 26 1,412 1,534 - - (4,335) (1,363)
------------------------ ------- ------- -------- -------- -------- --------------- -------
Total transactions with
owners 43 1,800 1,534 - (53) (4,335) (1,011)
At 31 December 2020 8,004 154,185 62,089 21,291 14,866 - 260,435
------------------------ ------- ------- -------- -------- -------- --------------- -------
Exchange
Share Share Retained rate Other Non-controlling Total
capital premium earnings reserve reserves interests equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ ------- ------- -------- -------- -------- --------------- --------
At 1 January 2019 7,767 151,147 99,299 31,113 16,404 3,548 309,278
------------------------ ------- ------- -------- -------- -------- --------------- --------
Comprehensive expense
(Loss) / profit for the
year - - (35,473) - - 345 (35,128)
Other comprehensive
expense for the year - - - (3,611) - (43) (3,654)
Total comprehensive
expense for the year - - (35,473) (3,611) - 302 (38,782)
Transactions with owners
Share based payments - - - - (641) - (641)
Tax relating to share
options - - - - (124) - (124)
Proceeds from shares
issued 194 1,238 - - (720) - 712
------------------------ ------- ------- -------- -------- -------- --------------- --------
Total transactions with
owners 194 1,238 - - (1,485) - (53)
At 31 December 2019 7,961 152,385 63,826 27,502 14,919 3,850 270,443
------------------------ ------- ------- -------- -------- -------- --------------- --------
Other reserves relates to share based payments.
Consolidated cash flow statement for the year ended 31 December 2020
2020 2019
GBP'000 GBP'000
------------------------------------------------------- -------- --------
Cash flows from operating activities
------------------------------------------------------- -------- --------
Adjusted cash inflow from operations 36,324 16,530
Cash impact of adjustments (867) (7,582)
-------------------------------------------------------- -------- --------
Cash generated from operations 35,457 8,948
Net interest paid (1,142) (671)
Income tax paid (993) (151)
-------------------------------------------------------- -------- --------
Net cash generated from operating activities 33,322 8,126
-------------------------------------------------------- -------- --------
Cash flows from investing activities
Purchase of property, plant and equipment (4,993) (31,864)
Purchase of intangible assets (731) (1,806)
Capitalised development expenditure (4,678) (8,427)
Proceeds from disposal of property, plant and equipment - 263
Acquisition of minority interest (1,363) -
Acquisition of subsidiary, net of cash acquired - 10
Net cash used in investing activities (11,765) (41,824)
-------------------------------------------------------- -------- --------
Cash flows from financing activities
Proceeds from issuance of ordinary shares 240 712
Proceeds from borrowings 5,000 41,895
Repayment of borrowings (7,030) (17,125)
Payment of lease liabilities (3,764) (3,651)
Net cash (used) / generated from financing activities (5,554) 21,831
-------------------------------------------------------- -------- --------
Net increase / (decrease) in cash and cash equivalents 16,003 (11,867)
Cash and cash equivalents at 1 January 8,800 20,807
Exchange losses on cash and cash equivalents (140) (140)
-------------------------------------------------------- -------- --------
Cash and cash equivalents at 31 December 24,663 8,800
-------------------------------------------------------- -------- --------
Notes to the financial statements for the year ended 31 December 2020
1. General information
IQE plc ('the company') and its subsidiaries (together 'the Group')
develop, manufacture and sell advanced semiconductor materials. The
Group has manufacturing facilities in Europe, United States of America
and Asia and sells to customers located globally.
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). The
address of the Company's registered office is Pascal Close, St Mellons,
Cardiff, CF3 0LW.
1. Basis of preparation and significant accounting policies
2.1 Basis of preparation
The financial information set out in the announcement does not
constitute the Group's statutory accounts for the year ended 31 December
2020 or 31 December 2019. Statutory accounts for 2019 have been
delivered to the registrar of companies, and those for 2020 will be
delivered in due course. The auditor has reported on those accounts and
their report was (i) unqualified, (ii) did not include references to any
matters to which the auditors drew attention by way of emphasis without
qualifying their report and (iii) did not contain statements under
section 498 (2) or (3) of the Companies Act 2006.
The financial statements have been prepared and approved by the
directors in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006 ("Adopted
IFRSs"). The financial statements have been prepared under the
historical cost convention except where fair value measurement is
required by IFRS the accounting policies have been consistently applied
to all years presented.
2.2 Going concern
The Group made a loss of GBP2,893,000 (2019: GBP35,128,000 loss) but had
an increase in cash and cash equivalents of GBP15,863,000 (2019:
GBP12,007,000 decrease) for the year ended 31 December 2020.
On 11 March 2020, the World Health Organisation declared the outbreak of
a coronavirus (COVID-19) a pandemic. The COVID-19 outbreak continues to
create uncertainty in global economies and the markets in which the
Group operates which pose risks to the Group's continuity of business
operations, demand for its products and its forecast future financial
performance given current world health and global economic conditions.
The following matters have been considered by the directors in
determining the appropriateness of the going concern basis of
preparation in the financial statements:
-- The Group's operations are geographically diversified. Manufacturing
operations are located at ten different sites across three continents,
significantly lessening the impact of potential disruption at any single
site as a result of the ongoing Coronavirus pandemic. All manufacturing
sites continue to remain operational and production has not been affected
by any disruption at any of the Group's global sites.
-- The Group dual or multi-sources key raw materials (substrates, gases,
spares and consumables) wherever possible, from a broad range of global
suppliers, reducing the likelihood of potential disruption to production
from any single supplier. The Group works closely with suppliers and
customers to manage inventory levels in order to create supply chain
resilience against potential disruption. All manufacturing sites continue
to remain operational and production has not been affected by any supply
chain disruption.
-- The Group's trading has remained resilient throughout the year with
significant growth experienced in a number of markets that has resulted
in the delivery of record revenue of GBP178,016,000 (2019:
GBP140,015,000) and an increase in adjusted profit before tax to
GBP3,221,000 (2019: GBP7,019,000 loss).
-- Net debt (excluding lease liabilities) has significantly reduced with the
group ending the financial year in a net funds (excluding lease
liabilities) position of GBP1,923,000 (2019: GBP15,970,000 net debt) as a
result of a combination of increased cash generated from operations and a
reduction in capital expenditure following the completion of the
infrastructure phase of the Group's expansion in Massachusetts USA,
Hsinchu Taiwan and at its Newport Foundry in South Wales. Net funds
(excluding lease liabilities) consists of GBP24,663,000 (2019:
GBP8,800,000) of cash net of bank loans of GBP22,740,000 (2019:
GBP24,770,000) repayable over a period to 29 August 2024.
-- On 24 January 2019, the Group agreed a GBP25,735,000 ($35,000,000)
three-year multi-currency revolving credit facility from HSBC Bank plc
which is undrawn. The Group has complied with all covenants associated
with the facility.
-- On 29 August 2019, the Group agreed a GBP30,000,000 five-year Asset
Finance Loan facility from HSBC Bank of which GBP25,000,000 has been
drawn. The Group has complied with all covenants associated with the
facility.
-- On 10 December 2020, the Group agreed the extension of the relaxation of
certain banking covenants applicable at 31 December 2020 and 30 June 2021
to include 31 December 2021 as an on-going precautionary measure designed
to increase covenant headroom and availability of cash funding under the
terms of the Group's committed bank facilities.
-- The Group generated cash from operating activities of GBP33,322,000
(2019: GBP8,126,000) and its financial forecasts for the period up to and
including 31 December 2022 show that the Group is forecast to continue to
comply with its banking covenants and has adequate cash resources to
continue operating for the foreseeable future.
-- The Group's trading has remained resilient throughout the year with
significant growth experienced in a number of markets with record revenue
of GBP178,016,000 (2019: GBP140,015,000) and strong growth delivered in
each of the Group's primary business segments. Wireless and Photonics
growth drivers, which include increased demand for GaAs wafers for 5G
smartphone power amplifiers, GaN on SiC wafers for 5G infrastructure and
advanced RF applications, VCSEL wafers for 3D sensing applications and
GaSb wafers for infrared applications, continue to remain strong and
trading in Q1 2021 remains favourable with positive momentum continuing
across the Group's Wireless and Photonics business units.
-- The Group's severe but plausible downside financial forecasts have been
prepared with significant reductions to future forecast revenues,
designed to reflect severe downside scenarios associated with demand
risks, for a 24-month period to 31 December 2022. The severe but
plausible downside scenario, applied to the Group's financial forecasts,
which take account of current trading and customer demand, assumes a 10%
reduction in 2021 revenue and a 22% reduction in 2022 revenue partially
offset by mitigations within the control of the company, including
deferred investment in employee related costs across the forecast period
and certain capital expenditure mitigations in 2022. The severe but
plausible downside scenario illustrates that the Group is forecast to
continue to comply with its banking covenants but would require either
the extension, or refinancing of its current revolving credit facility
from HSBC Bank plc on expiry in January 2022. The severe but plausible
downside scenario illustrates that a facility of GBP9,000,000,
significantly below the Group's current committed facility of
GBP25,735,000 could be required in 2022. The Group has a long-standing
and trusted relationship with its bankers, HSBC Bank plc, who remain
supportive and who have, at the date of this report, extended formal
credit approved heads of terms for a one-year extension of the Group's
GBP25,735,000 ($35,000,000) revolving credit facility until January 2023.
The credit approved heads of terms include banking covenants consistent
with the covenant arrangements applicable until expiry of the existing
facility. On this basis, the directors believe that the group has, or
will have access, to adequate cash resources to continue operating for
the foreseeable future even in a severe but plausible downside scenario.
The Group meets its day-to-day working capital and other cash
requirements through its bank facilities and available cash. The Group's
cash flow forecasts and projections, in conjunction with the level of
assessed covenant headroom on the Group's committed bank facilities show
that the Group and the Company have adequate cash resources to continue
operating and to meet its liabilities as they fall due for the assessed
period to 31 December 2022, such that the directors consider it
appropriate to adopt the going concern basis of accounting in preparing
the consolidated financial statement.
1. Changes in accounting policy and disclosures
2. New standards, amendments and interpretations.
The following new standards, amendments and interpretations have been
adopted by the Group for the first time for the financial year beginning
on 1 January 2020:
-- Amendments to IFRS 9 'Financial Instruments', IAS 39 'Financial
Instruments: Recognition and Measurement' and IFRS 7 'Financial
Instruments: Disclosures' to provide certain reliefs, including in
relation to hedge accounting, arising from issues related to interest
rate benchmark reform.
-- Amendments to IFRS 3 'Business Combinations' which clarifies the
definition of a business.
-- Amendments to IAS 1 'Presentation of financial statements' and IAS 8
'Accounting policies, changes in accounting estimates and errors' which
are intended to make the definition of material easier to understand.
-- Amendments to references to the 'Conceptual framework' in IFRS standards.
The adoption of these standards, amendments and interpretations has not
had a material impact on the financial statements of the Group or parent
company.
(b) New standards, amendments and interpretations issued but not
effective and not adopted early
A number of new standards, amendments to standards and interpretations
which are set out below are effective for annual periods beginning after
1 January 2020 and have not been applied in preparing these consolidated
financial statements.
-- Amendment to IFRS 3 'Business combinations' to update references to the
Conceptual Framework for Financial Reporting without changing the
accounting requirements for business combinations.
-- Amendments to IFRS 9 'Financial Instruments', IAS 39 'Financial
Instruments: Recognition and Measurement', IFRS 7 'Financial Instruments:
Disclosures, IFRS 4 'Insurance Contracts', IFRS 16 'Leases' related to
interest rate benchmark reform (phase two) and the issues that arise from
the implementation of the reforms, including the replacement of one
benchmark with an alternative one.
-- Amendment to IFRS 16 'Leases' which provides an optional practical
expedient for lessees from assessing whether a rent concession related to
COVID-19 is a lease modification.
-- IFRS 17 'Insurance contracts' which establishes the principles for the
recognition, measurement, presentation and disclosure of insurance
contracts and supersedes IFRS 4 'Insurance Contracts'
-- Amendments 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.
-- Amendments to IAS 16 'Property, plant and equipment' to prohibit the
deduction from cost of property, plant and equipment amounts received
from selling items produced while preparing the asset for its intended
use with any such sales and related cost recognised in profit or loss.
-- Amendments to IAS 37 'Provisions, contingent liabilities and contingent
assets' to specify which costs a company includes when assessing whether
a contract will be loss making.
-- Annual improvements to make minor amendments to IFRS 1 'First-time
adoption of IFRS', IFRS 9 'Financial Instruments', IAS 41 'Agriculture'
and amendments to the illustrative examples accompanying IFRS 16
'Leases'.
The Directors anticipate that at the time of this report none of the new
standards, amendments to standards and interpretations are expected to
have a material effect on the financial statements of the Group or
parent company.
3. Segmental analysis
3.1 Description of segments and principal activities
The Chief Operating Decision Maker is defined as the Executive
Management Board. The Executive Management Board, consisting of the
Chief Executive Officer, Chief Financial Officer, Chief Operations
Officer, Chief Technology Officer, Executive VP Global Business
Development, Wireless and Emerging Products and Executive VP Global
Business Development, Photonics & Infrared consider the group's
performance from a product perspective and have identified three primary
reportable segments:
-- Wireless -- this part of the business manufactures and sells compound
semiconductor material for the wireless market which includes radio
frequency devices that enable wireless communications.
-- Photonics -- this part of the business manufactures and sells compound
semiconductor material for the photonics market which includes
applications that either transmit or sense light, both visible and
infrared.
-- CMOSS++ - this part of the business manufactures and sells advanced
semiconductor materials related to silicon which include the combination
of the advanced properties of compound semiconductors with those of lower
cost of silicon technologies.
The Executive Management Board primarily use revenue and a measure of
adjusted operating profit to assess the performance of the operating
segments. Measures of total assets and liabilities for each reportable
segment are not reported to the Executive Management Board and therefore
have not been disclosed.
2020 2019
Revenue GBP'000 GBP'000
------------------------------------------------------- -------- --------
Wireless 94,193 68,166
Photonics 81,627 69,758
CMOS++ 2,196 2,091
Revenue 178,016 140,015
------------------------------------------------------- -------- --------
Adjusted operating profit / (loss)
Wireless 11,393 6,590
Photonics 9,080 1,324
CMOS++ (714) (1,304)
Central corporate costs (14,373) (11,286)
Adjusted operating profit / (loss) 5,386 (4,676)
Adjusted items (see note 4) (10,903) (14,126)
Operating loss (5,517) (18,802)
Reversal / share of losses of joint venture accounted
for using the equity method 3,788 (4,688)
Finance costs (2,165) (1,458)
Loss before tax (3,894) (24,948)
------------------------------------------------------- -------- --------
4. Adjusted profit 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 operating profit, adjusted profit before income tax and
adjusted earnings per share. The Directors believe that the adjusted
profit measures provide a more 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 profit 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
profit measures and the impact on the Group's reported financial
performance.
2020 2019
Adjusted Adjusted Reported Adjusted Adjusted Reported
Results Items Results Results Items Results
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------ --------- -------- --------- --------- -------- ---------
Revenue 178,016 - 178,016 140,015 - 140,015
Cost of
sales (144,689) (177) (144,866) (119,145) 514 (118,631)
------------ --------- -------- --------- --------- -------- ---------
Gross profit 33,327 (177) 33,150 20,870 514 21,384
Other income - - - - - -
SG&A (27,759) (6,938) (34,697) (25,791) (10,506) (36,297)
Impairment
loss on
financial
assets - (3,788) (3,788) - (4,134) (4,134)
Profit on
disposal of
PPE (182) - (182) 245 - 245
------------ --------- -------- --------- --------- -------- ---------
Operating
profit /
(loss) 5,386 (10,903) (5,517) (4,676) (14,126) (18,802)
Reversal /
share of JV
losses - 3,788 3,788 (737) (3,951) (4,688)
Finance
costs (2,165) - (2,165) (1,606) 148 (1,458)
------------ --------- -------- --------- --------- -------- ---------
Profit /
(loss)
before tax 3,221 (7,115) (3,894) (7,019) (17,929) (24,948)
Taxation (519) 1,520 1,001 (11,991) 1,811 (10,180)
Profit /
(loss) for
the period 2,702 (5,595) (2,893) (19,010) (16,118) (35,128)
------------ --------- -------- --------- --------- -------- ---------
2020 2019
Pre-tax Tax Adjusted Pre-tax Tax Adjusted
Adjustment Impact Results Adjustment Impact Results
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------- ----------- -------- -------- ----------- -------- --------
Share based
payments (265) 210 (55) 771 133 904
Amortisation
of acquired
intangibles - - - (385) 81 (304)
Restructuring (162) 39 (123) (813) 164 (649)
Patent dispute
legal fees 1,689 (321) 1,368 (4,308) 775 (3,533)
Impairment --
intangibles (6,537) 1,242 (5,295) (3,805) 685 (3,120)
Onerous
contract (1,840) 350 (1,490) - - -
Impairment --
ROU asset - - - (1,623) - (1,623)
Impairment --
financial
assets (3,788) - (3,788) (4,134) - (4,134)
Share of JV
losses --
financial
asset 3,788 - 3,788 (3,951) - (3,951)
CSDC
acquisition -
negative
goodwill - - - 171 - 171
Discounting - - - 148 (27) 121
Total (7,115) 1,520 (5,595) (17,929) 1,811 (16,118)
-------------- ----------- -------- -------- ----------- -------- --------
The nature of the adjusted items is as follows:
-- Share based payments -- The charge (2019: credit) recorded in accordance
with IFRS 2 'Share based payment' of which GBP177,000 (2019: GBP514,000
credit) has been classified within cost of sales in gross profit and
GBP88,000 (2019: GBP257,000 credit) has been classified as selling,
general and administrative expenses in operating profit. GBPnil cash has
been defrayed in the year (2019: GBP1,331,000) in respect of employer
social security contributions following the exercise of unapproved
employee share options.
-- Amortisation of acquired intangibles - The charge of GBPnil (2019:
GBP385,000) relates to the amortisation of acquired intangibles arising
in respect of fair value exercises associated with previous corporate
acquisitions and has been classified as selling, general and
administrative expenses within operating profit and is non-cash.
-- Restructuring -- The charge of GBP162,000 relates to employee retention
bonus costs relating to the announced closure of the Group's
manufacturing facility in Pennsylvania, USA. The charge was classified as
selling, general and administrative expenses within operating loss. Cash
costs defrayed in the year total GBPnil.
The 2019 charge of GBP813,000 relates to the closure of the Group's
manufacturing facility in New Jersey, USA at a cost of GBP226,000 and
site-specific restructuring and employee severance costs of GBP587,000.
The charge was classified as selling, general and administrative
expenses within operating loss. Cash costs of GBP1,947,000 related to
severance and reactor decommissioning costs of GBP1,360,000 associated
with the closure of the New Jersey site and cash costs of GBP587,000
associated with site specific employee severance costs.
-- Patent dispute legal costs -- The credit relates to a settlement
agreement of GBP1,825,000 (US$2,500,000) associated with legal costs
incurred by the Group that has been negotiated with the plaintiff
following an arbitration panel ruling in favour of the Group on 17
January 2020. The settlement has been cash received in the post balance
sheet period. The credit also includes an increase in insurance income of
GBP410,000 (2019: GBPnil) following final settlement with the Group's
insurers partially offset by legal costs incurred during the year of
GBP546,000 (2019: GBP4,308,000). Cash cost, net of the full insurance
receipt of GBP740,000 ($1,000,000) total GBP867,000 as a result of the
payment of current and prior period legal costs during the year of
GBP1,607,000 (2019: GBP4,304,000).
-- Impairment of intangibles -- The non-cash charge of GBP6,537,000 (2019:
GBP3,805,000) relates to the impairment of the Group's non-filter related
cREO(TM) patent and development costs resulting from a lack of current
intent to continue relevant development activities following the refocus
of resource and investment into cREO(TM) filter related development
activities. The non-cash charge in 2019 related to the impairment of
certain development costs, patent costs and software where the Group took
the decision to either discontinue using the asset or discontinue the
relevant technology development activities.
-- Onerous contract -- The onerous contract provision of GBP1,840,000 (2019:
GBPnil) is non-cash in the current period and represents the cost of
minimum guaranteed future royalty payments associated with the use of
cREO(TM) technology acquired from Translucent Inc.
-- Impairment of right of use asset -- The non-cash charge of GBPnil (2019:
GBP1,623,000) relates to the impairment of the right of use asset
relating to space at the Singapore manufacturing site sub-let by Compound
Semiconductor Development Centre Limited, the Group's former joint
venture that was acquired during 2019. The charge was classified as
selling, general and administrative expenses within operating loss.
-- Impairment of financial asset -- The non-cash charge of GBP3,788,000
(2019: GBP4,134,000) relates to the increase in the expected credit loss
associated with the Group's preference share financial asset due from its
joint venture, CSC.
-- Reversal / share of joint venture losses (financial asset) - The Group
treats its preference share financial assets due from its joint venture,
CSC, as a long-term interest in an equity accounted investee and is
required to apply the loss absorption requirements of IAS 28.38 to the
carrying amount of the preference share financial asset, after the
application of any expected credit losses as described above and in note
3.8. Application of the loss absorption requirements following the
increase in expected credit losses has resulted in the reversal of the
Group's share of previously allocated joint venture losses to the
preference share financial asset resulting in a non-cash credit of
GBP3,788,000 (2019: GBP3,951,000 charge) which has been recognised within
'share of losses of joint ventures accounted for using the equity method'
in the Consolidated Income Statement.
-- CSDC acquisition negative goodwill -- The non-cash credit of GBPnil
(2019: GBP171,000) relates to the negative goodwill arising on the
Group's acquisition of its former joint venture, Compound Semiconductor
Centre Limited (see note 31). The credit was classified as selling,
general and administrative expenses within operating loss.
-- Discounting -- This relates to the unwind of discounting on long term
financial assets of GBPnil (2019: GBP148,000). Discounting is non-cash
and has been classified as finance costs within profit before tax.
The cash impact of adjusted items in the consolidated cash flow
statement represents the cash costs defrayed in 2020 in respect of
patent dispute legal costs, net of insurance income received in respect
of patent legal costs totalling GBP867,000.
Adjusted EBITDA (adjusted earnings before interest, tax, depreciation
and amortisation) is calculated as follows:
2020 2019
GBP'000 GBP'000
------------------------------------------------ ------------ --------
Loss attributable to equity shareholders (3,271) (35,473)
Non-controlling interest 378 345
Finance costs 2,165 1,458
Tax (1,001) 10,180
Depreciation of property, plant and equipment 12,983 10,477
Depreciation of right of use assets 3,681 3,590
Amortisation of intangible fixed assets 7,869 8,222
Loss/(profit) on disposal of PPE 182 (245)
Share based payments 265 (771)
Adjusted Items 6,850 18,463
------------------------------------------------ --- -------- --------
Restructuring 162 813
Patent dispute settlement and legal costs (1,689) 4,308
Impairment of intangibles 6,537 3,805
Onerous contract provision 1,840 -
Impairment of right of use asset - 1,623
Impairment of financial asset 3,788 4,134
Share of joint venture losses (financial asset) (3,788) 3,951
CSDC acquisition negative goodwill - (171)
Adjusted EBITDA 30,101 16,246
------------------------------------------------ --- -------- --------
5. Loss per share
Basic loss per share is calculated by dividing the loss attributable to
ordinary shareholders by the weighted average number of ordinary shares
in issue during the year.
Diluted loss per share is calculated by dividing the loss attributable
to ordinary shareholders by the weighted average number of shares and
the dilutive effect of '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 year. 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.
The directors also present an adjusted earnings per share measure which
eliminates certain adjusted items in order to provide a more meaningful
measure of underlying profit. The adjustments are detailed in note 4.
2020 2019
GBP'000 GBP'000
---------------------------------------------------- ----------- -----------
Loss attributable to ordinary shareholders (3,271) (35,473)
Adjustments to loss after tax (note 4) 5,595 16,118
Adjusted profit / (loss) attributable to ordinary
shareholders 2,324 (19,355)
---------------------------------------------------- ----------- -----------
2020 2019
Number Number
---------------------------------------------------- ----------- -----------
Weighted average number of ordinary shares 797,228,579 787,175,574
Dilutive share options 11,395,298 13,562,165
---------------------------------------------------- ----------- -----------
Adjusted weighted average number of ordinary shares 808,623,877 800,737,739
Adjusted basic loss per share 0.29p (2.46p)
Basic loss per share (0.41p) (4.51p)
Adjusted diluted loss per share 0.29p (2.46p)
Diluted loss per share (0.41p) (4.51p)
---------------------------------------------------- ----------- -----------
6. Cash generated from operations
2020 2019
Group GBP'000 GBP'000
------------------------------------------------------ -------- --------
Loss before tax (3,894) (24,948)
Finance costs 2,165 1,458
Depreciation of property, plant and equipment 12,983 10,477
Depreciation of right of use assets 3,681 3,590
Amortisation of intangible assets 7,869 8,222
Impairment of intangible assets 6,537 3,805
Impairment of right of use assets - 1,623
Impairment of financial assets 3,788 4,134
Share of joint venture (3,788) 3,951
Inventory write downs (note 17) 3,025 3,219
Loss / (profit) on disposal of fixed assets 182 (245)
CSDC acquisition negative goodwill - (171)
Non-cash provision movements 2,002 -
Share based payments 265 (771)
------------------------------------------------------ -------- --------
Cash inflow from operations before changes in working
capital 34,815 14,344
(Increase) / decrease in inventories (4,128) 2,184
(Increase) / decrease in trade and other receivables (7,151) 4,130
Increase / (decrease) in trade and other payables 11,921 (11,710)
------------------------------------------------------ -------- --------
Cash inflow from operations 35,457 8,948
------------------------------------------------------ -------- --------
(END) Dow Jones Newswires
March 25, 2021 03:00 ET (07:00 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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