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Filtronic abandons IPO for handset antennas operation

Posted: 04 Feb 2005 ?? ?Print Version ?Bookmark and Share

Keywords:wireless chip? filtronic? antenna? mobile phone?

Wireless chip specialist Filtronic has shelved plans to float its handsets products business, which is among the top three suppliers of antennas for mobile phones, and is looking at other options to reduce its debts.

In a statement accompanying the company's interim results for the six months ended Nov. 30, Filtronic said that while it is continuing to look at the disposal of the handset products division, which represents just over 20 percent of group sales, "in light of current market conditions, the board is not pursuing an initial public offering (IPO) at this stage."

The group planned an IPO on the Helsinki, Finland stock exchange so that it could focus on its integrated power amplifier and transmit/receive modules activities for wireless base stations, where 63 per cent of its sales come from and which is expected to contribute the biggest margins in the coming years.

The other part of the business, representing a further 16 per cent of sales is supplying MMICs, most recently for point to point microwave links.

Professor David Rhodes, Filtronic's chairman, said the group continued to reduce its net debts over the period, by ?10.6 million ($20 million) to ?44 million ($83 million), mainly though the disposal and leaseback of sites in Merrimack, USA and Brisbane, Australia.

Sales rose 5 per cent to ?130.1m ($245 million), led by an 18 per cent increase in wireless infrastructure sales to ?82.3m ($155 million). However, operating profits for the period were ?2.6 million ($4.9 million), half of what it achieved for the corresponding six months of 2003, primarily because of the performance of the handset products division.

Professor Rhodes said Filtronic maintained it's roughly 18 per cent global market share for mobile phone antennas, and is now supplying the parts to a broader customer base, including Samsung and several ODMs.

He added power amplifier production is being ramped up and the company is developing a new line of integrated devices for wireless infrastructure. However, he warned revenues in the handsets group are expected to remain 'seasonal' and that operating margins in the division may come under pressure.

- John Walko

EE Times

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