The boss of Imagination tells Ollie Gordon how he discussed tech with Elizabeth II
IT WASN’T something I was expecting, it was hugely humbling,” says Sir Hossein Yassaie of the knighthood he received from the Queen in the New Year’s Honours list last year in recognition of his services to technology and innovation.
Yassaie, the chief executive of British semiconductor company Imagination Technologies, adds: “The actual visit to the Palace and meeting the Queen was very, very interesting. We had a fascinating chat about the rise of the smartphone.
“Personally, it’s a really big deal to come from another country and be recognised in this way, and it has really raised my respect for Britain. It’s also great to see technology celebrated, which will hopefully encourage more kids to go study electronics and computer science.”
A British national since 1984, Yassaie came to the UK from Iran in 1976. He joined Imagination in 1992, quickly rising through the ranks to be named CEO six years later. He subsequently refocused the business on advanced technology development and created its successful silicon intellectual property business model, with the company growing rapidly into its current FTSE-250 shoes.
But that growth has stalled of late, and Imagination’s results for the first half of the year, published yesterday, reflect that slowdown. The Apple supplier saw its adjusted operating profits plummet 75 per cent year-on-year to £5m, with half-year group revenues down £3m to £82.2m. The decline has come as a bearish mobile chip market has combined with a period in which Imagination has poured money into developing its multimedia and computer processing platforms.
“We’ve had a certain transition period because we’ve been investing heavily in the core technologies,” says Yassaie. “And if you go back a couple of years, there was change in the mobile market that saw some of our customers exit because they though it was too hard.
“In mobile chips, there is a small number of big customers, and a number of those customers chose to exit because it was either win a lot or lose a lot. And, for us, losing customers like that slowed down our revenues. But, quite frankly, to go through all those changes, maintain our investments, and still deliver $5m profit is not really bad going.”
And investors appear to agree. The company’s stock surged over 16 per cent in trading yesterday following publication of the firm’s figures. Investors were buoyed by results that were not as weak as analysts had expected, as well as the company’s confirmation that its investment phase is finally at an end.
“Now that our product lines are complete and the heavy investment phase is over, we expect to see lower rates of operating cost growth going forward and increased focus on financial returns,” said Yassaie.
“Our market relevant and complementary technologies combined with our increased scale enable us to take advantage of natural leverage to improve the financial performance of our business. As a result we now expect to see significant expansion in operating margins in the medium-term.”
So it seems that for Yassaie and Imagination the braces are now off and, although there are still some lingering aches and pains, life is only going to get better.