TomTom NV Q2 results: strong increase in revenues and net profit

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Beleggingsadvies 27/07/2005 08:09
TomTom NV Q2 results: strong increase in revenues and net profit
Second quarter 2005
Financial highlights:
Revenue of € 114.8 million, up 221% on the prior year and 73% on the previous quarter
262,000 integrated units shipped, up 143% on the previous quarter
Net profit of € 22.1 million, up 306% on the prior year, and 61% on the previous quarter.
Fully diluted EPS of € 0.20 for the quarter
Operational highlights:

Three new GO products, the GO 300, the GO 500, and the GO 700 launched
TomTom Plus, real-time location based services offering launched
European deals for the Toyota Aygo and Opel Corsa
Expansion into Australia and further broadening of European distribution
Cooperation with AVIS announced

Full year 2005: revenues expected to at least triple compared to 2004, with a broadly similar operating margin as 2004
For the whole press release, please click on the link below.

TomTom s Chief Executive Officer, Harold Goddijn said:
The market for personal navigation products and services is growing rapidly and
TomTom is a key driver of this growth with our newly introduced range of GO products, the GO 300, GO 500, and GO 700. We continued to grow both revenues and profit strongly in the second quarter due to the success of our new products. We expanded our presence geographically and secured important partnerships in the automotive sector. Adding the TomTom Plus range of real time location based services enables us to provide the user with a richer navigation experience. We look forward to the rest of the year with confidence and we now expect revenues to at least triple compared with last year, with operating margins sustained at a broadly similar level to last year s full year
reported operating margin.

Market developments
The total European and US car park is 418 million cars, and only 10% of new cars sold have a satellite navigation system fitted. 94% of cars on the road in Europe and 98% in the US do not have a satellite navigation system. Market acceptance for personal navigation products is accelerating faster than anticipated and there is continued high growth in the sector. This growth is being driven by more product choice and by lower price points for consumers. There is a move amongst consumers away from nonintegrated solutions towards integrated, fit-for purpose devices. TomTom is well positioned with its newly updated product range to be one of the leaders in this rapidly developing market.

Operational review
We shipped our new family of GO products, the GO 300, GO 500, and GO 700 during
the quarter. The three models each offer different functionality and price points, designed to gain mass market acceptance for our products. The majority of the GO units sold in the period were GO 300 units which started shipping in April. First shipments of the GO 500 and GO 700 took place towards the end of the quarter.
We are pleased with the progress we are making in the US. Distribution is increasing and we expect around 2,500 outlets to be selling our products by the end of the summer including Best Buy, Circuit City, CompUSA and Fry s Electronics. This network will give us meaningful national distribution for the first time. We also started shipping in Australia for the first time and we have had a positive reaction from this market so far.
We further deepened our distribution network across Western Europe to include,
amongst others: Halfords in the UK; Brightpoint in Germany, Finland and Sweden; Inpro Technologia and PC City in Spain; Norauto in France; GEN-Art in Italy and ACR Braendli & Voegell in Switzerland. We also expanded into Eastern Europe with our first product sales in Poland and The Czech Republic.
In the automotive sector we have made good progress which is marked in particular by volume shipments for our pan-European automotive deal for the Opel Corsa and by first shipments for the Toyota Aygo. We also announced a new cooperation with AVIS to supply the GO 700 for hire at selected airport rental centres across Europe.

The effective tax rate for the company in the quarter was 32.4% made up of the tax on the profits of the European operations at the Dutch tax rate of 31.5% and with no tax asset recorded against the losses of the US operation.
Cash flow During the quarter we received net proceeds from the IPO of 116.6 million and we generated cash from operations of 19.8 million. Working capital increased by 10.5 million. In the second half we will invest to fund the increased working capital we will need to fuel our growth.

Balance sheet
Our balance sheet was strengthened in the period by the issue of 7,142,857 new shares which increased shareholders equity by 116.6 million. At the end of the quarter we had no gearing and a net cash position of 187.9 million.

Het aandeel geeft goede cijfers, maar de concurrentie zal niet achterblijven en daar schuilt de pijn. Een product en dan blijf je kwetsbaar.
Het aandeel vinden wij te duur!

Bericht om 14.45 uur,
TomTom zegt later, In de VS loopt de zaak nog niet zoals het moet, maar er wordt hard aangewerkt. Er wordt veel aan marketing gedaan (uitgegeven ruim 12 miljoen in 't tweede kwartaal) , daar zullen pas later de vruchten worden geplukt. Hoe het gaat lopen in de VS wil/kan TomTom nog niet zeggen. Ook zal er nog geen dividend uitbetaald gaan worden.
De beleggers zullen het van winstnemingen moeten hebben. Dat vinden wij zorgelijk, want als de beleggers wel tot winstnemingen overgaan, kan de koers ook weer hard terug. Vandaag wil iedereen door dezelfde deur.

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