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IQE looks to 2013 for growth

RESULTS: Semiconductor specialists, IQE, expects strong growth from 2013 and brokers estimate the shares could be worth as much as 65p
March 21, 2012

Semiconductor specialist, IQE, saw sales rise 4 per cent in the year to end-December 2011 to £75.3m, while pre-tax profit increased 9 per cent to £6.89m – despite an inventory correction in the last quarter having held performance back..

IC TIP: Buy at 28p

While that inventory issue has continued into the current year, chief executive Drew Nelson expects a return to growth from the following quarter. Moreover, IQE's gross margin increased to 24.1 per cent from 22.8 per cent and the group has invested £17.4m in building capacity for an expected surge in demand, which Mr Nelson expects from 2013. Broker Canaccord Genuity forecasts adjusted pre-tax profit for 2012 of £9.4m, giving adjusted EPS of 1.56p.