IQE is the leading global outsource supplier of customized epitaxial wafers to the semiconductor industry.

Their technology is of most advanced like AFM means Atomic Force Microscopy and moves a minuscule cantilever over an objects surface, a sharp tip passes over dips or rises punched in the surface and reads out digital information. This technology is not going to slow down it is going to speed up and has to replace most existing forms of memory storage by virtue of capacity and size.

The future of nano-technology, these tiny/minute robots would need very small processors and most sure strained silicon could provide these.

The low share price is due to uncertainty as to when the cash will run out, but I don't think this will happen as cash is of 12 to 15M and NAV of 30p, and losses are going to drop on the next 3 month and we could have profits on the Q4 2004.

Latest news from the Chairman were" The Group remains confident that it is in a strong position within the outsourcing market, although the protection of its cash position is paramount.
With a broad product portfolio allowing the customer base to use IQE as a 'one stop shop', a large available production capacity and a strong balance sheet, the Board believes the Group will benefit strongly as the overall semiconductor industry recovers and will continue to strengthen its position as the leading outsource supplier of advanced wafer products to the sector. "

Nearly all the recent results have been encouraging. Q4 accounts are being completed (30th Dec 2002). IQE know where they stand, if things had got worse their would have been a trading statement by now, and with Amberwave (IQE's partner) increasing its Asian presence, this is a bullish trend and a good point to pick up the shares @ 4.25p

Intraday

5 month MA and Indicators

Mid twenties would be my guess.

That would be a good start britshare. There have been a few false dawns the last couple of years so hopefully this time will be different!

After all the disappointments in the last couple of years i would be happy to see 20p.

IQE PLC
21 August 2006


IQE plc

Embargoed for release until 7am, 21 August 2006

21 August 2006

IQE plc

(the ''Company'' or ''IQE'')

Acquisition


IQE, the leading global outsource supplier of customised wafer products and
outsource wafer services to the semiconductor industry, has completed the
acquisition of the Electronic Materials Division ('EMD'), the US epi foundry
business from EMCORE Corporation Inc. (NASDAQ listed: EMKR) ('EMCORE').


Key details of the acquisition

IQE has acquired the assets and business of EMD for a total of $16 million. The
total consideration is based on an initial payment of $13 million in cash and a
further $3 million in cash payable in four equal quarterly payments. The
deferred consideration will bear interest at 7.5 per cent. per annum

The acquisition has created the leading global outsource supplier of epi wafers
to the wireless market, providing significant opportunities to accelerate sales
into existing and new customers by providing the broadest range of current and
next generation products

All of EMD's employees, including its strong management team, have been offered
employment with IQE and it is the intention of the Board that the EMD business
will continue to be run as a stand alone entity in New Jersey

Noble & Company Limited has placed 87.5 million new ordinary IQE shares ('New
Ordinary Shares') at 13.75p per share to raise approximately 12 million (before
expenses) to finance the consideration and working capital (the 'Placing'). The
new ordinary shares were admitted to trading on AIM on 16 August 2006

Following the passing of the resolutions put to the shareholders at the
Extraordinary General Meeting held on 15 August 2006, admission of the New
Ordinary Shares to trading on AIM on 16 August 2006, and settlement of funds
with EMCORE IQE has now completed the acquisition


Details of the business

EMD provides foundry based production of high performance compound semiconductor
electronic epitaxial materials, with a focus on the wireless markets. EMD is
based in the US, has approximately 50 employees, ten advanced epitaxial tools
and is one of the top five third-party suppliers of epi wafers in the world.

EMD has pursued a similar strategy to that of IQE, in building a strong
outsource foundry model for the supply of epi wafers. They have concentrated on
HBT based technologies for power amplifier applications, as well as integrated
BiFET and GaN structures, and consequently supply a range of highly
complementary products to a range of customers different to that of IQE's own
customer base.

The acquisition positions IQE as the leading global outsource supplier of
current and next generation products into the wireless marketplace including
PHEMT, HBT, integrated BiFET and advanced GaN technologies. The Directors
believe this will create significant opportunity to grow revenues within
existing IQE and EMD customers by offering all major technology platforms to the
enlarged customer base, from the largest, state of the art production capacity
in the industry.

Dr Drew Nelson, President & CEO of IQE plc commented: 'We are very happy to
have completed this acquisition, which represents a key step forward in IQE's
development as the leading outsource wafer supplier worldwide to the global
semiconductor industry. The joining of the two companies allows IQE to offer a
truly one stop wafer outsource service to its customers, with a complete range
of current and next generation products. This transaction assures EMD's current
customers that as part of a larger wafer outsource group all the necessary
resources are in place to fully support the joint customer base as their wafer
demands continue to grow.'


Contacts

IQE plc +44(0) 29 2083 9400
Dr Drew Nelson, President & CEO
Stuart Hall, CFO
Chris Meadows, Investor Relations

Noble & Company Limited +44(0) 20 7763 2200
John Llewellyn-Lloyd
Graeme Bayley


About IQE

IQE is a leading provider of outsource epitaxial wafer services to the global
semiconductor industry. Its wafer products include a portfolio of compound
semiconductor wafers for use across the whole spectrum of opto electronic and
wireless applications, a range of advanced compound semiconductor substrates,
and a comprehensive epi service of advanced products for the silicon industry.
IQE operates state of the art manufacturing facilities utilizing all of the key
crystal growth technologies, with facilities located in Cardiff and Milton
Keynes, UK and in Bethlehem, Pennsylvania , USA. IQE's products are found in a
diverse range of leading edge consumer, communication, computing and industrial
applications, including mobile handsets and wireless infrastructure, optical
communications, optical storage (CD, DVD), laser optical mouse, laser printers &
photocopiers, thermal imagers, leading edge medical products, barcode, high
efficiency LEDs and a variety of advanced silicon based systems.

I'm very surprised not to see the market react more positively to today's very encouraging results. Losses slashed, sales up and, most importantly, an admission that things look set to continue on this positive path.

Not surprised.. it's a funny old market.... should see some upside but it moight be gradual.

Queen1, they're still slightly loss-making and trading at I guess around 3 times NAV including proceeds of recent fundraising and acqusition, so it's understandable that one or two may decide to bank the profits they made on doubling their money in less than a year.

Also the margin of gross profit is very low at 9%. I don't know how their costs stack up, but it's clear they have a long way to go to cover their current rate of losses.

Agreed soul traders and on paper I have doubled my money on these. But I think today's results show the big strides taken towards profitability and on that basis I'm happy to stick around.

At last, a break through 17p! Decisive?

Well, it continues a very attractive trendline that has been rising since about the end of May 2005.

Shares Mag seems to like IQE as well.

I got on board this time last year. It's been a slow journey but I'm hoping it will continue!

Any views on the recent fall over the last month or so.
Lots of sells not many buys.

Blame Shares Mag for tipping it!!

I'm still positive. On the way to profitability so I'm maintaining my holding.

I not sure that they are on the way to profitability.
With revenue of 14.5m they are still posting a loss of 1.5m. They have traded at a loss for the last five years & although the margin is narrowing, losses continue.
Having bought EMD for $13m, they also now have to part with 4 x $750k payments over the next year. I haven't been able to find out if EMD itself is profitable, but as it is intended to stand alone & still trade as EMD, this shouldn't really matter. However, if EMD need a short term cash injection it would make sense to borrow it from IQE, thus affecting IQE's cash flow.
IMO IQE won't be profitable within the next 18 months, sadly.

Any news on this one?More deals in the last 2 days.Hopefully they will break past the 17p.

It just needs a little nudge over 17p Shauney and I think we'll be off and running!

Shauney, what deals? - can't see any RNS on this.

My tip/ramp for the day: If it's silicon you want, buy SOLA. Roaring away, currently at 200p, price target 300p - and the co is both profitable and growing fast. PDYOR etc.

Sorry Soul i meant shares traded. Sola do look interesting will keep an eye on them.

IQE, the leading worldwide outsource supplier of customised wafer products and outsource wafer services to the global semiconductor industry is pleased to announce that it has signed a Memorandum of Understanding with a leading European RF wireless chip foundry. The agreement concerns the supply of IQE's epi-wafers to be used in their RF wireless switch products. The intention of the memorandum is that the customer will utilise IQE as its preferred external supplier of epi-wafers to complement their existing in-house epi-wafer capacity. As the customer's own product demand increases, it is anticipated that any increase in epi-wafer requirements beyond the customers internal capacity will flow directly to IQE as the customer's preferred external source.

Commenting on the agreement Dr Drew Nelson, CEO of IQE plc, said, 'IQE is very pleased to announce a new outsource arrangement with another leading supplier of RF chips to the global wireless industry, having worked closely with the customer over the last twelve months to achieve fully 'qualified supplier' status. We will be working closely with the customer to fully realise all the benefits of such an outsource arrangement to enable significant commercial benefits to accrue to both parties. Again, this demonstrates the strength of the outsource model, which is now becoming a key part of customers strategic considerations.'