Slight Dip in Q3 Revenues as IMI Copes With Global Slowdown

Integrated Micro-Electronics, Inc. (IMI) posted US$341 million of revenues in the third quarter of 2023, 3 percent lower year on year. The drop in demand is largely driven by a general slowdown across the electronics industry with companies tightening working capital levels amidst excess inventory in the supply chain. The company’s gross margin sits at 8.5 percent, with a total gross profit of $28.8 million for the quarter. Third-quarter net loss is at $1.6 million which still includes losses from STI Limited as IMI worked on closing the divestment transaction with Rcapital.

IMI’s wholly owned subsidiaries ended the quarter with a net income of $1.9 million versus $3.8 million in the same period last year. Major contributors to this drop are a $1 million inventory provision in Q3 and a $0.9 million increase in interest expense compared to 2022. Management teams will continue to closely monitor inventory levels to mitigate our exposure and accelerate cash conversion. With STI Limited still in the process of transitioning out of the group, non-wholly owned subsidiaries reported a net loss of $3.5 million in the third quarter.

Said IMI President Jerome Tan: “With the recent closing of the sale of STI Limited to Rcapital at the end of October, our management teams will be able to refocus efforts into improving margins for the core businesses and concentrate on sharpening our customer portfolio. Starting November 1, 2023, the financial results of STI Limited will no longer be consolidated into IMI figures, and the capital dedicated to supporting STI Limited will be redistributed to enable growth in our profitable business segments.” 

Tan added that new mobility project wins from the past few years have begun to contribute to the company, with the segment growing 12 percent compared to 2022. Sales pipeline activity remains robust with $247 million worth of annual revenue potential across all segments secured in the first nine months of 2023, a 50 percent improvement against the same period last year of $165 million. 

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