Gemalto announced its revenue for the first quarter of 2009.
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 EUR 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.
At historical exchange rates, Q1 2009 revenue is lower by 14%.
At EUR 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 MÃÂ©diamÃÂ©trie 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.
At historical exchange rates, Q1 2009 revenue is lower by 1%.
At EUR 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
Gemalto announced several new commercial successes during the quarter,
securing a number of new EMV migration opportunities, including an
alliance with CorporacÃÂon 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.
At historical exchange rates, Q1 2009 revenue is increasing by 27%.
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
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.
At historical exchange rates, Public Telephony and POS Terminals
combined Q1 2009 revenue is flat.
Public Telephony revenue continued to decline as mobile telephony
expands, and POS Terminals grew on strong sales in Europe and the Middle
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
Gemalto (Euronext NL 0000400653 GTO) is the world leader in digital
security with 2008 annual revenues of EUR1.68 billion, and 10,000
employees operating out of 75 offices, research and service centers in
Gemalto is at the heart of our evolving digital society. The freedom to
communicate, travel, shop, bank, entertain, and workÃ¢ÂÂanytime,
anywhereÃ¢ÂÂhas 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.