TomTom reports fourth quarter and full year 2010 results
Financial highlights full year 2010
- Revenue increased by 3% to €1,521 million
- Net result increased by 24% to €108 million, EPS of €0.49
- Net debt reduced to €294 million (YE 2009: €442 million)
Financial highlights Q4 2010
- Revenue decreased by 3% to €516 million (Q4 2009: €533 million)
- Content & Services revenue grew by 16% to €98 million
- Automotive revenue grew by 52% to €55 million
- Gross margin of 46% and EBIT margin of 13%
- Net result of €52 million
- Net cash flow from operating activities of €141 million
Operational highlights Q4 2010
- Expansion of existing automotive partnerships with Fiat, Toyota and Subaru
- Agreement signed with smartphone manufacturer HTC for provision of content
- Extension of MiTAC content licensing agreement to include Magellan
- GPS fitness watch announced in conjunction with Nike
Outlook full year 20111
We expect broadly flat revenue and earnings per share in 2011 compared with 2010.
TomTom’s Chief Executive Officer, Harold Goddijn
“In 2010 we launched new products, rolled-out our traffic information service and broadened the customer base of our company. We grew revenue and earnings per share and generated €145 million of cash.
The size of the PND market declined compared to the previous year, though by increasing our market share and because of a more limited decline in selling prices, our Consumer business proved to be a resilient revenue base for the company. Our Automotive business delivered rapid growth (52% y.o.y.) by deepening existing and adding new partnerships. Our Business Solutions unit grew strongly and our content Licensing business successfully focused on the expanding internet and wireless market.
Overall I am pleased with the performance of the company in 2010. In 2011 we will accelerate the development of the technologies which will deliver the user experience expected by our customers of tomorrow.”
Outlook 2011
In 2011 we expect our Consumer business unit revenues to contract modestly as a result of a decline in the size of the PND market and limited price erosion, partly compensated by a strengthening of our market share, geographical expansion and growth in Content and Services. Automotive is expected to grow its existing partnerships, offer real-time services and announce new contract wins. Licensing will widen its product delivery capabilities to strengthen our position in the government, enterprise and wireless markets. Business Solutions aims to outperform the expected European fleet management market growth rate of 10 to 20 percent. Overall we expect revenue to be broadly in line with 2010.
TomTom has developed all of the core content, knowledge and technologies needed to create the best user experience for car navigation. We will invest in these assets to bring innovative products and services to the market. 2011 will see an increase in expenditure, primarily in development and commercial activities, as we evolve our technologies and capabilities to expedite our growth in the Automotive and Business Solutions segments. Together with more Content and Services in our revenue mix and a reduced level of debt, this results in an expectation of broadly flat earnings per share compared with 2010.
View the full TomTom Fourth Quarter and Full Year 2010 results release in PDF format at www.tomtom.nl
