Slide 1: H1 2024 Interim Results Presentation
H1 2024 Interim Results Presentation 10 September 2024 Powering tomorrow’s technology, today
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by IQE plc solely for information purposes and Although IQE plc believes that the expectations, estimates and projections constituting should not be considered to be an offer or solicitation to buy, sell or subscribe for any any forward-looking statemen
Slide 3: Welcome
Welcome Americo Lemos Chief Executive Officer Powering tomorrow’s technology, today
Slide 4: Market update
Market update Americo Lemos Chief Executive Officer Powering tomorrow’s technology, today
Slide 5: Industry recovering at varying paces
Industry recovering Wireless market at varying paces inventory correction Photonics market slower recovery IQE plc | H1 2024 Results Presentation 5
Slide 6: £66m revenue delivered in line with market guidance
27% £66m revenue growth vs H1 2023 £6.6m revenue delivered in line with market guidance Adjusted EBITDA 1 £12.3m increase vs H1 2023 Note: H1 2024 financials are unaudited IQE plc | H1 2024 Results Presentation 6 1 Adjusted EBITDA and LBIT are non-IFRS measures, may be calculated differently and the
Slide 7: H1 2024 Financial Performance
H1 2024 Financial Performance Jutta Meier Chief Financial Officer Powering tomorrow’s technology, today
Slide 8: H1 2024 segmental revenue
H1 2024 segmental revenue Total Wireless Total Photonics Total CMOS++ £38.8m £26.8m £0.5m Increased Down Down 73% 4% 70% from H1 2023 from H1 2023 from H1 2023 • Result of inventory normalisation • A reduction in segments of InP • Reflects a strategic rebalancing of and design wins in Android RF Fro
Slide 9: H1 2024 financial highlights
H1 2024 financial highlights Revenue Adj. EBITDA1 Adj. LBIT1 Adj. operating cashflow £’m £’m £’m £’m 66.0 4.3 52.0 6.6 1.8 10% H1 H1 H1 2023 2023 2024 H1 H1 H1 H1 H1 2023 2024 2024 2023 2024 14% (7.2) (5.7) (17.4) Note: H1 2024 financials are unaudited IQE plc | H1 2024 Results Presentation 9 1 Adju
Slide 10: Net debt bridge
Net debt bridge £1.8m Adjusted operating cashflow £(2.6)m Net operating cashflow IQE plc | H1 2024 Results Presentation 10
Slide 11: Cost control initiatives
Cost control initiatives 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 Continued focus in H2 on structural cost co
Slide 12: Strategic update
Strategic update Americo Lemos Chief Executive Officer Powering tomorrow’s technology, today
Slide 13: We have the right strategy
We have the right strategy Maintain Diversify CONNECT SENSE POWER DISPLAY IQE plc | H1 2024 Results Presentation 13
Slide 14: Addressing the growing GaN Power market
Addressing the growing GaN Power market GaN investment R&D Industry inflection point Investment in GaN tools Accelerated GaN Power R&D Power demand from key technology Deployed capacity in two continents Pipeline of Power GaN R&D projects trends including GenAI and EVs R&D and production ramp capaci
Slide 15: GenAI ready portfolio
GenAI ready portfolio Edge AI Connect anywhere Cloud VCSELs, lasers, GaN RF, GaAs HBT Quantum lasers, detectors Photonics InP, VCSELs InP: Accurate & advanced sensing InP: Ultra-low latency, high bandwidth connectivity GaN: Efficient power IQE plc | H1 2024 Results Presentation 15
Slide 16: Proposed IQE Taiwan IPO
Proposed IQE Taiwan IPO Strategic move to accelerate implementation of the growth initiatives set out at the Capital Markets Day Enhance our market position Expect to Upgrade & Accelerate Enhance expand enter growth strategy R&D efforts production Emerging capacity Market Board in Public offering to
Slide 17: Current trading and outlook - 2024
Current trading and outlook - 2024 Moderated pace of recovery expected to continue Sector recovery expected to continue in H2, albeit at different rates across market segments and regions – macro factors continue to impact consumer confidence Revenue and adjusted EBITDA expected at lower end of anal
Slide 18: Appendix
Appendix Powering tomorrow’s technology, today
Slide 19: H1 2024 cashflow, capex and net debt
H1 2024 cashflow, capex and net debt Capitalised Cashflow PP&E capex cashflow Adj. net debt development costs £1.8m £1.4m £5.0m £(17.0)m Adjusted operating 30 June 2024 cashflow Down Down £(2.6)m £0.2m £0.2m £5.3m Net operating cashflow from H1 2023 from H1 2023 Net funds at H1 2023 • Adj. op cashfl
Slide 20: EBITDA bridge
EBITDA bridge Note: H1 2024 financials are unaudited IQE plc | H1 2024 Results Presentation 20
Slide 21: Summary financials
Summary financials £’million H1 2024 H1 2023 Revenue 66.0 52.0 Sales, general & administrative costs (16.3) (16.4) Impairment loss on trade receivables and contract assets 0.1 0.4 Adjusted EBITDA1 6.6 (5.7) Adjusted LBIT (7.2) (17.4) Reported LBIT (12.1) (19.6) Reported loss before tax (13.9) (21.5)
Slide 22: Adjusted income statement items
Adjusted income statement items H1 2024 H1 2023 Share based payments £2.1m £0.5m Share based payments – £0.1m £0.0m CEO and CFO recruitment CEO recruitment £0.2m £0.2m CFO severance and - £0.3m recruitment Restructuring £1.3m £1.2m Restructuring – loss on £1.1m - disposal of PPE Restructuring – impa
Slide 23: Balance sheet
Balance sheet As at 30 June 2024 £’million H1 2024 H1 2023 Intangible assets 34.3 35.1 Property, plant & equipment 124.7 121.6 Right of use assets 45.7 38.9 Total current assets 81.6 75.4 Current liabilities* (50.6) (35.7) Bank borrowings due within 1 year (1.6) (6.1) Lease liabilities due within 1