Ayala-led electronics manufacturing service provider, Integrated Micro-Electronics Inc. (IMI), turned unprofitable in the first quarter of the year as lockdown measures and global supply chain disruptions triggered by the new coronavirus disease (COVID-19) pandemic constrained businesses across various markets.
IMI ended the quarter with a net loss of $4.6 million, a turnaround from the modest $335,000 net profit in the same period last year, the company disclosed to the Philippine Stock Exchange (PSE).
Global revenues amounted to $256 million in the first three months, down by 20.7 percent from $323 million a year ago, attributed to the global fallout from the outbreak.
Despite operational headwinds, IMI said it continued to extend various assistance programs to employees working in a number of territories under quarantine.
IMI global management teams tempered the negative financial impact by controlling overhead costs, reducing raw material expenses and securing support from various governments including Bulgaria, China, Czech Republic, Germany, Serbia and Singapore, the company disclosed.
The wholly owned businesses of IMI saw a 19-percent drop in first quarter revenues to $209 million. Operations were hampered by government-mandated shutdowns of its facilities in China in February and the enhanced community quarantine (ECQ) in the Philippines that began in mid-March.
As such, revenues from Asian operating units fell by 20 percent year-on-year to $105 million.
Operating sites in Europe and North America remained fully operational throughout the first quarter, but revenues declined by 15 percent due to disruptions in the global supply chain.
Germany-based Via Optronics and UK-based STI Ltd. produced combined revenues of $47 million, a decline of 27 percent year-on-year. Both subsidiaries faced near-term headwinds in their regions, particularly Via Optronics’ extended shutdown of its main operating plant in Suzhou, China.
While the overall market environment was challenging, IMI said it was pursuing additional business opportunities, particularly in the medical and telecommunications segments.
Since successfully returning to full operational capacity in early March, IMI’s operating sites in China have seen growth in demand for products used in medical equipment and 5G telecom infrastructure. STI has also started producing components used in medical ventilators as part of the Ventilator Challenge UK.
The recent rise in work from home arrangements is also expected to lead to an uptick in demand for Via Optronics’ display solutions in the laptop segment.
“IMI’s robust business continuity protocols allow us to smoothly adapt our operations to current circumstances while ensuring the health and safety of our employees. The company’s wide geographical footprint gives us the flexibility to shift and address demands across all our regions as the pandemic situation continues to affect global markets,” said Arthur Tan, IMI’s chief executive. —DORIS DUMLAO-ABADILLA INQ
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