AYALA-LED Integrated Micro-Electronics Inc. (IMI) on Monday said its income for the first quarter of the year plunged 94 percent to just $335,000 (about P16.7 million) from the previous year’s $5.57 million as its margins were constrained due to the fallout from the US-China trade war.
Consolidated revenues were flat at $323.04 million from last year’s $325.79 million, the company said in its disclosure to the Philippine Stock Exchange.
“Margins remain constrained by global market slowdown due to the fallout from the trade wars, political uncertainty in the UK and the ongoing electronic component shortage,” it said, adding margins were at 9 percent for the period from 10.6 percent last year.
IMI, however, said it continues to grow its target business segments in automotive, industrial and aerospace which comprise 77 percent of total revenues for the quarter.
Automotive revenues were at $168 million, a 27-percent growth; industrial at $68 million, a 10-percent increase; while aerospace, which IMI entered through the acquisition of a company, is now at $13 million, a growth of 6 percent from last year.
Consumer and telecom segment, however, declined by 59 percent and 12 percent, respectively, due to delays in new project awards and economic slowdown in China.
Aside from elevated raw materials costs, tight supplies of electronics components raised the need for expedited production cycles and expensive freight deliveries to maintain IMI’s top-level standards, the company said.
“The long and healthy relationships with our key customers have enabled us to open discussions to mitigate financial headwinds on IMI as we weather the global component issue. Having positioned ourselves as a top provider of high complexity technology solutions, we are poised to rebound quickly on both revenue and profitability aspects as our investments in the past years come to full utilization,” said Arthur Tan, the company’s CEO.
IMI has used $180 million for capital expenditures in the past three years, a significant portion of which was spent to support development of high-tech businesses and the opening of new operating sites that expanded its manufacturing footprint to Serbia and Japan.