Ayala Corporation, the country’s oldest conglomerate, is no longer selling manufacturing subsidiary Integrated Micro-electronics Inc. as the unit has managed to turnaround after measures were taken to cut losses.
In an interview, Ayala Chief Finance Officer Alberto M. de Larrazabal said that they had put the company in the market last year but, since no deal was made, they have opted to get it into better share.
“We’ve pulled it out of the market. We’re not entertaining offers at this point,” said Larrazabal noting that, when IMI was on the selling block last year, they did not get any good offers.
He explained that, “we brought in a whole new team (into IMI) and they have done an excellent job in restructuring the organization. To flatten it, reduce the costs.
“So the cost structure is so much better now. So now you have a much more profitable operation.”
With this done, he said that, this year, IMI’s focus will be on the sales side since its profitability will allow it to be more competitive in bidding for sales contracts.
“We have actually exited certain product lines where we know we do not have the capability. What we’ve done is we’ve refocused back to where our strengths are,” said Larrazabal.
He noted that, IMI has brought down inventory levels, fine-tuned and revamped operating and manufacturing processes, brought in new talents, and has reduced operations down to its core products “where we have inherent strengths.”
Larrazabal said the core business is now in good shape although they still have a bit of a challenge with IMI’s subsidiary VIA Optronics
“This year we will be focusing on growing. Then, after that, we can weigh the options. Whether we sell will be a function of how market circumstances are,” he said.
Last January, IMI announced the strategic closure of its facility in Chengdu, China as part of its ongoing efforts to streamline operations and reduce costs, aligning with the company’s strategy to consolidate its footprint into strategically located facilities.
Production at IMI Chengdu concluded in December 2024 after all customer commitments have been successfully met although some remaining customer projects have been seamlessly transferred to other IMI sites.
“This strategic move is expected to enhance operational efficiency and bolster IMI’s capability to deliver high-quality products and services to its global portfolio of customers from its other strategically positioned manufacturing sites.
“We are taking these steps to ensure our operations remain aligned with market demands while enhancing our ability to serve customers with agility and cost-effectiveness.
“We extend our heartfelt gratitude to our Chengdu team for their dedication and hard work in ensuring a smooth transition,” said IMI Chief Executive Offier Louie Hughes.
IMI reported that its net loss ballooned almost five-fold to P$9.2 million in the first nine months of 2024 from $1.6 million in the same period of 2023.
The firm said its core businesses have remained profitable for the year, generating $4.3 million of net income excluding one-offs over the first nine months of 2024.
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