Imagination Technologies on track for higher licensing revenues

LONDON, June 30 (Reuters) - Imagination Technologies (Other OTC: IGNMF - news) , which provides graphics technology to Apple (NasdaqGS: AAPL - news) , said it was confident of achieving licensing revenue growth of 10 percent this year, a target which reassured investors after a downgrade last year.

For the year to April 30, Imagination on Tuesday reported licensing revenue growth of 2 percent, in line with the downgraded forecast for single-digit growth provided in March.

Shares (Berlin: DI6.BE - news) in Imagination, which receives revenue from selling licenses to partners that incorporate the technology in their chips, climbed 2.5 percent following the publication of the company's results.

"You have to frame the licensing revenues target against the warning back in March. It's a bit of a relief around that," Jefferies analyst Robert Lamb said.

Imagination's confidence in the rise in licensing revenues came after the company said it had secured a new licensing deal with an unnamed tier-one mobile company and said that Spreadtrum, a Chinese mobile chip-maker, had also become a licensee.

"We see these as extremely positive developments for Imagination," added the analyst.

The company, which has a market capitalisation of 585 million pounds ($920 million), reported annual adjusted operating profit of 21.1 million pounds, slightly behind last year, and guided that profitability would rise in 2016. ($1 = 0.6358 pounds) (Reporting by Sarah Young; editing by James Davey)