Graphics chip designer Imagination Technologies more than tripled pre-tax profit in the year to end April after selling 47 per cent more chips for smartphones, netbooks and set-top boxes.
Some 37 Imagination-based products are now in production by partners, up from 29 last year, which meant units shipped jumped from 86m to 126m and gave management the confidence to reiterate its 200m full-year target. Royalty revenue jumped by 75 per cent to £24.4m, with average royalty per chip up from 16.2p to 19.4p as customers switched to the latest generation of chips. That more than offset flat licensing income of £22.9m, which included 12 major new deals with partners such as Apple.
Digital radio arm PURE is close to break-even after reducing adjusted operating losses by 90 per cent to £300,000, on revenues up 23 per cent at £33.6m, thanks to a better UK performance and an ongoing analogue-to-digital international switch.
Broker Panmure Gordon predicts adjusted pre-tax profits of £31.1m and EPS of 9.26p this year. Meanwhile, Intel and Apple are both customers and shareholders, with 15.7 and 10.6 per cent stakes respectively, making Imagination a possible takeover target.
IMAGINATION TECHNOLOGIES (IMG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 295p | MARKET VALUE: | £718m | |
| TOUCH: | 295-297p | 12-MONTH HIGH: | 312p | 104p |
| DIVIDEND YIELD: | NIL | PE RATIO: | 49 | |
| NET ASSET VALUE: | 28p | NET CASH: | £29m | |
| Year to 30 Apr | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2006* | 35.3 | -6.87 | -3.70 | nil |
| 2007* | -48.1 | -2.30 | -1.20 | nil |
| 2008** | 60.0 | 1.88 | 1.00 | nil |
| 2009 | 64.1 | 2.72 | 3.70 | nil |
| 2010 | 80.9 | 10.2 | 6.00 | nil |
| % change | +26 | +274 | +62 | - |
*12-month period to 31 March **13-month period to 30 April | ||||
