Ayala’s IMI reports $41-M net earnings

By James A. Loyola

Integrated Micro-Electronics, Inc. (IMI), the Ayala group’s tech manufacturing arm, announced that its September year-to-date net income, including favorable one-off items, rose to US$41.4 million from US$24.1 million in the same period last year.

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In a disclosure to the Philippine Stock Exchange, the firm said revenues grew 27 percent year-on-year with corresponding gross profit increase of 22 percent.

Gross profit margins, however, declined from last year’s 11 percent to 10.6 percent due to higher material, production, and logistics costs arising from the global component shortage.

The three-quarter reporting period ended September 30, 2018 includes non-operating income from recent transactions such as the sale of a Shenzhen entity and reversal of contingent liability related to the STI acquisition.

These are offset by a partial impairment of recorded goodwill on the acquisition of our China facilities triggered by slowing growth in the region.

Weakness of the RMB and EUR also resulted to significant foreign exchange losses. Excluding these one-offs, forex impact and other adjustments, net income is at $28.9 million versus last year’s adjusted net income of US$27.6 million.

“The fast-paced evolution of automotive and industrial segments resulting to unexpected demand for components is creating pressure in constrained markets,” said IMI Chief Executive Officer Arthur Tan.

He added that, “as we face the current challenges, IMI continues to strive in setting the bar to key technological advancements and remain ahead of the curve. We continue to expand our reach in countries which we believe will reap positive benefits and develop a competitive edge in the global market.”

Revenues of core businesses stood at US$780 million, a combined 18 percent growth across all IMI manufacturing sites in Europe, Asia, and Mexico. The growth came from the industrial and automotive segments which grew 67 percent and 24 percent year-on-year, respectively.