Regulatory News:
Gemalto (Euronext NL0000400653 - GTO), the world leader in digital
security today announced its revenue for the first quarter of 2009.
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First quarter 2009 revenue and year-on-year revenue variation, by
segment:
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Mobile
Communication
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Secure
Transactions
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Security
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Total
three main
segments
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Others1
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Total
Gemalto
Q1 2009
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Total
Gemalto
Q1 2008
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First quarter
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192 M€
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100 M€
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60 M€
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351 M€
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16 M€
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367 M€
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388 M€
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Variation at constant exchange rates
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(19%)
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+ 1%
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+ 26%
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(8%)
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0%
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(8%)
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At historical exchange rates, Gemalto 2009 first quarter total
revenue is down 5%.
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Olivier Piou, Chief Executive Officer, commented: ?Revenue for
this quarter, though lower than Q1 2008, was in line with our
expectation of a return to the traditional seasonality pattern. Strong
progress continues to be made in securing new contracts for mobile
services and contactless payment devices. Government Programs benefits
from both a solid backlog and increasing momentum in national e-ID
programs. We are pleased with our success in leveraging our operational
efficiencies.?
First quarter 2009
Total revenue for the Q1 2009 was € 367 million, lower than Q1 2008 by
8% at constant exchange rates and by 5% at historical exchange rates.
Compared to a particularly strong first quarter last year Mobile
Communication reported lower revenue, while Secure Transactions turnover
was essentially unchanged. Government Programs continued to expand
rapidly, with new national e-ID programs on the rise. Revenue from
software and services increased from 8% of total revenue in Q1 2008 to
10% in Q1 2009. Net cash position further strengthened during this
quarter.
Segment information
Mobile Communication
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€ in millions
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Q1 2008
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Q1 2009
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Mobile Communication
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223
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192
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Year-on-year variation at constant exchange rates
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(19%)
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At historical exchange rates, Q1 2009 revenue is lower by 14%.
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At € 192 million first quarter 2009 Mobile Communication revenue was
lower than the very strong first quarter of 2008 by 19% at constant
exchange rates and by 14% at historical exchange rates, in line with
seasonality expectations for 2009.
The average SIM card selling price was lower by 17% year-on-year at
constant exchange rates, again compared with a strong performance in the
prior year. This reflects large shipments of entry-range products in
South Asia and lower activity in the high end North Asia markets.
Sequentially, i.e. compared to the fourth quarter of 2008, SIM card
average selling price declined by 6%.
Software and services revenue increased by 16% year-on-year, with
excellent performance in Asia and the Americas. Gemalto is gaining
momentum in securing new contracts for operated services with mobile
operators: by the end of Q1 it had already surpassed the number of
contracts signed during the full year 2008. The wide range of new
applications and service contracts secured during this quarter included
among others launching the SIMessenger solution for Personal Argentina,
as well as the mobile TV monitoring solution for Médiamétrie in France.
Gemalto also continues to strengthen its service offerings through
collaborations with partners. These included India-based mCheck for
mobile payment, and Option of Belgium for the remote device management
of Internet modems deployed to provide 3G data access.
Secure Transactions
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€ in millions
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Q1 2008
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Q1 2009
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Secure Transactions
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101
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100
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Year-on-year variation at constant exchange rates
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+ 1%
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At historical exchange rates, Q1 2009 revenue is lower by 1%.
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At € 100 million first quarter 2009 Secure Transactions revenue was
essentially unchanged from last year. Compared to Q1 2008, it is down 1%
at historical exchange rates and up 1% at constant rates.
Growth continues to be supported by deployment of dual-interface
contactless EMV cards particularly in Europe and the Americas, and by
further improvements in the level of personalization services, while
inventory optimization was observed at some payment card customers.
Lower Pay-TV shipments were partially offset by a stronger activity in
Transport.
Gemalto announced several new commercial successes during the quarter,
securing a number of new EMV migration opportunities, including an
alliance with Corporacíon Cardtech to address the Venezuelan market, as
well as Royal Bank of Scotland's EMV launch in Indonesia, India and
Taiwan. Numerous new programs were also announced in partnership with
our customers, including an innovative contactless EMV student identity
and payment card for Banco Santander in Spain.
Security
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€ in millions
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Q1 2008
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Q1 2009
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Security
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47
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60
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Year-on-year variation at constant exchange rates
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+ 26%
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At historical exchange rates, Q1 2009 revenue is increasing by
27%.
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In the first quarter of 2009 Security again posted a strong growth, with
revenue up by 26% at constant exchange rates and 27% at historical rates.
Government Programs revenue expanded by 32% on the back of strong
activities in the Americas. Steady delivery of electronic passport
contracts was complemented by the growing number of national e-ID
programs now underway. Identity and Access Management (IAM) revenue was
down 2%, with continued success in online banking solutions offset by
inventory optimization by the indirect distribution channels delivering
enterprise solutions. As expected, patent activity was also higher than
in 2008.
New commercial wins during the quarter – including further successes in
Belgium, Bahrain and Saudi Arabia - highlight the growing importance of
national e-ID programs alongside the existing e-passport deployments. In
IAM, the selection by Vietnam's largest bank Vietcombank builds on the
success of Gemalto's increasingly recognized online banking solutions,
and illustrates the Company's ability to leverage its expertise in
strong two-factor authentication combined with EMV CAP (Chip
Authentication Programs) services.
Others
The Public Telephony and POS Terminals segments, representing together
less than 5% of the Company's total revenue, are now reported on a
combined basis.
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€ in millions
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Q1 2008
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Q1 2009
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Others
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16
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16
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Year-on-year variation at constant exchange rates
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0%
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At historical exchange rates, Public Telephony and POS
Terminals combined Q1 2009 revenue is flat.
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Public Telephony revenue continued to decline as mobile telephony
expands, and POS Terminals grew on strong sales in Europe and the Middle
East.
Outlook
Our business has strong fundamentals and prospects. The current economic
environment does not put into question the mid and long-term objectives
of Gemalto, even if it limits short-term visibility. We will continue
our mission to provide trust and convenience to the wireless and digital
world that is emerging, and look ahead with the goal of revenue growth
and earnings expansion.
Market seasonality in 2009 is expected to be in line with historical
patterns. Our 2009 objective of above 10% adjusted operating margin
remains unchanged.
Conference call
Gemalto will hold an analysts and investors conference call in English
today at 3:00 pm Paris time (2:00 pm London time and 9:00 am New York
time). Callers may participate in the live conference call by dialling:
+44 207 107 1613 or +1 866 907 5928 or +33 1 72 00 09 86.
The presentation slide show will be available for download on our
Investor Relations web site (www.gemalto.com/investors)
at 1:00 pm Paris time (12:00 am London time, 7:00 am New York time).
Replays of the conference call will be available from approximately 3
hours after the conclusion of the conference call until May 14th
midnight Paris time by dialling:
+33 1 72 00 14 69
access code: 248652 #.
Reporting calendar
2009 second quarter revenue and first half earnings will be reported on
August 25, 2009, before the opening of Euronext Paris.
About Gemalto
Gemalto (Euronext NL 0000400653 GTO) is the world leader in digital
security with 2008 annual revenues of €1.68 billion, and 10,000
employees operating out of 75 offices, research and service centers in
40 countries.
Gemalto is at the heart of our evolving digital society. The freedom to
communicate, travel, shop, bank, entertain, and work?anytime,
anywhere?has become an integral part of what people want and expect, in
ways that are convenient, enjoyable and secure.
Gemalto delivers on the growing demands of billions of people worldwide
for mobile connectivity, identity and data protection, credit card
safety, health and transportation services, e-government and national
security. We do this by supplying to governments, wireless operators,
banks and enterprises a wide range of secure personal devices, such as
subscriber identification modules (SIM) in mobile phones, smart banking
cards, electronic passports, and USB tokens for online identity
protection. To complete the solution we also provide software, systems
and services to help our customers achieve their goals.
As the use of Gemalto's software and secure devices increases with the
number of people interacting in the digital and wireless world, the
company is poised to thrive over the coming years.
For more information please visit www.gemalto.com.
This communication does not constitute an offer to purchase or exchange
or the solicitation of an offer to sell or exchange any securities of
Gemalto.
This communication contains certain statements that are neither reported
financial results nor other historical information and other statements
concerning Gemalto. These statements include financial projections and
estimates and their underlying assumptions, statements regarding plans,
objectives and expectations with respect to future operations, events,
products and services and future performance. Forward-looking statements
are generally identified by the words "expects", "anticipates",
"believes", "intends", "estimates" and similar expressions. These and
other information and statements contained in this communication
constitute forward-looking statements for purposes of applicable
securities laws. Although management of the company believes that the
expectations reflected in the forward-looking statements are reasonable,
investors and security holders are cautioned that forward-looking
information and statements are subject to various risks and
uncertainties, many of which are difficult to predict and generally
beyond the control of the company, that could cause actual results and
developments to differ materially from those expressed in, or implied or
projected by, the forward-looking information and statements, and the
company cannot guarantee future results, levels of activity, performance
or achievements. Factors that could cause actual results to differ
materially from those estimated by the forward-looking statements
contained in this communication include, but are not limited to: the
ability of the company's to integrate according to expectations; the
ability of the company to achieve the expected synergies from the
combination; trends in wireless communication and mobile commerce
markets; the company's ability to develop new technology and the effects
of competing technologies developed and expected intense competition
generally in the companies' main markets; profitability of expansion
strategy; challenges to or loss of intellectual property rights; ability
to establish and maintain strategic relationships in its major
businesses; ability to develop and take advantage of new software and
services; the effect of the combination and any future acquisitions and
investments on the company's share prices; and changes in global,
political, economic, business, competitive, market and regulatory
forces. Moreover, neither the company nor any other person assumes
responsibility for the accuracy and completeness of such forward-looking
statements. The forward-looking statements contained in this
communication speak only as of the date of this communication and the
company are under no duty, and do not undertake, to update any of the
forward-looking statements after this date to conform such statements to
actual results, to reflect the occurrence of anticipated results or
otherwise except as otherwise required by applicable law or regulations.
Appendix 1
Deliveries of secure personal devices (unaudited)
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In millions of units
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First quarter
2008
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First quarter
2009
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% growth
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SIM cards
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254
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247
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(3%)
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Secure Transactions
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69
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69
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0%
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Security
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9
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13
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+ 44%
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Total
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332
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329
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(1%)
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Appendix 2
First quarter revenue by region at historical rates (unaudited)
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€ in millions
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First quarter
2008
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First quarter
2009
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Year-on-year
variation at historical
exchange rates
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Year-on-year
variation at constant
exchange rates
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EMEA
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214
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192
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(11%)
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(10%)
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North & South America
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88
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101
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+ 15%
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+ 12%
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Asia
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85
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74
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(13%)
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(22%)
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Total revenue
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388
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367
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(5%)
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(8%)
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First quarter revenue by business segment at historical rates (unaudited)
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€ in millions
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First quarter
2008
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First quarter
2009
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Year-on-year
variation at historical
exchange rates
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Year-on-year
variation at constant
exchange rates
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Mobile Communication
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223
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192
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(14%)
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(19%)
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Secure Transactions
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101
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100
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(1%)
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+ 1%
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Security
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47
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60
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+27%
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+26%
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Others
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16
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16
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0%
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0%
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Total revenue
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388
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367
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(5%)
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(8%)
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Appendix 3
Average exchange rates between the Euro and the US dollar
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EUR/USD
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2008
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2009
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First quarter
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1.48
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1.33
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Second quarter
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1.56
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First half
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1.52
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Third quarter
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1.54
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Fourth quarter
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1.35
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Second half
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1.44
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Full year
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1.48
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1 Public Telephony plus Point-of-Sale Terminals, together
accounting for less than 5% of total first quarter revenue.
Investor Relations
Vincent Biraud
M.: +33(0)
6 08 48 33 23
vincent.biraud@gemalto.com
or
Corporate
Communication
Rémi Calvet
M.: +33(0) 6 22 72 81
58
remi.calvet@gemalto.com
or
Emlyn
Korengold
TBWA Corporate
T. : +33 (0) 6 08 21 93
74
emlyn.korengold@tbwa-corporate.com
