Integrated Micro-Electronics Inc. (IMI), a subsidiary of the Ayala Group struggling to make a profit, may be on the cusp of a profitable year after a period of restructuring and streamlining its operations. The company, which has faced considerable financial difficulties, has scaled down its operations, refocusing on its core strength to improve profitability.
Alberto M. de Larrazabal, Ayala Corp. chief financial officer, acknowledged that VIA Optronics AG, the IMI unit providing interactive display systems, is still expected to face challenges in achieving profitability. But just the same, he said, the core business of IMI could return to the black this year. The VIA unit, which offers products such as optical bonding, metal mesh touch sensors, and camera modules, has been a source of concern for the company’s financials.
“VIA will still be a bit of a challenge, but our core business should return to profitability,” de Larrazabal said, emphasizing company efforts to streamline its operations. As part of the restructuring, IMI has revamped its manufacturing processes, recruited new talent, and focused on optimizing its cost structure. The result has been a much leaner and more profitable operation, with substantial reductions in overhead.
IMI’s operational shift has included existing non-core product lines where the company lacked sufficient capabilities. Additionally, IMI closed its Chengdu, China facility in December 2024 and transitioned customer commitments to other operational sites. CEO Louie Hughes highlighted the importance of aligning operations with market demand while enhancing cost-effectiveness. The company thanked its Chengdu team for ensuring a smooth transition.
Financially, IMI has made progress despite still facing depressed revenue. For the first nine months of 2024, IMI losses were reduced to $9.23 million, a significant improvement from the $85.26 million loss reported for the same period in 2023. However, revenues were still down 18 percent year-on-year, totaling $841.01 million, compared to $1.03 billion in prior year. Despite the drop, $758 million of this year’s revenue was generated from IMI’s core businesses, which saw a 9 percent decline in sales year-on-year.
The Ayala Group previously considered selling IMI but decided to pull the company from the market after an unsatisfactory offer and unfavorable peso-dollar exchange rate. De Larrazabal expressed confidence in the new leadership at IMI, which has made significant strides in restructuring the organization, flattening its structure, and reducing costs.
Looking ahead, IMI’s ability to return to profitability will depend on the continued success of its core operations and its ability to navigate a challenging market environment.
