Gemalto (Euronext NL0000400653 - GTO), the world leader in digital
security today announces its revenue for the third quarter of 2013.
Third quarter 2013Ongoing operations(€ in
Year-on-year variations atconstant exchange rates
Olivier Piou, Chief Executive Officer, commented: "Gemalto's
diversified businesses and geographic footprint led to another quarter
of strong revenue growth. A key component of our new multi-year plan is
the development of our Platforms & Services activity, and its
performance, expanding nearly +30% since the beginning of the year,
evidences the trust our customers place in us. Our Embedded software &
Products activity also develops rapidly, as expected, with +8% in
year-to-date revenue growth. With this progress and despite the adverse
currency environment we are on track to deliver on our outlook for 2013,
which remains unchanged."
1 See basis of preparation on page 2, and appendix 3 of this
document for more information on ongoing operations.
Basis of preparation of financial information
For a better understanding of the current and future year-on-year
evolution of the business, the Company provides revenue from "ongoing
operations" for both 2013 and 2012 reporting periods.
The adjusted income statement for ongoing operations excludes, as per
the IFRS income statement, the contribution from discontinued operations
to the income statement, and also the contribution from assets
classified as held for sale and from other items not related to ongoing
In this publication reported figures for ongoing operations only differ
from figures for all operations by the contribution from assets held for
Appendix 3 bridges the revenue for ongoing operations to the revenue for
Historical exchange rates and constant exchange rates figures
Revenue variations are at constant exchange rates except where otherwise
The Company sells its products and services in a very large number of
countries and is commonly remunerated in currencies other than the Euro.
Fluctuations in exchange rates of these other currencies against the
Euro have a translation impact on the reported Euro value of the Company
revenues. Comparisons at constant exchange rates aim at eliminating the
effect of currencies translation movements on the analysis of the Group
revenue by translating prior year revenues at the same average exchange
rate as applied in the current year.
Third quarter 2013Revenue contributions by sector (€
in millions)Ongoing operations
Totalfour main segments
Year-on-year variationsat constant exchange rates
As a percentage of total revenue growthat constant exchange
Third quarter 2013Revenue contributions by activity
(€ in millions)Ongoing operations
Embedded software& Products
For the period, revenue for ongoing operations was up by +10%
year-on-year at constant exchange rates to €596 million, growing in all
regions and in all main segments. The Mobile sector grew by +9%, with an
identical increase in both Mobile Communication and Machine-to-Machine
segments. The Payment & Identity sector grew by +13%, on the back of an
excellent performance in Secure Transactions (+18%) and a lower increase
(+5%) recorded in Security this quarter.
Platforms & Services activities posted €113 million in revenue, an
increase of +37% compared to the third quarter of 2012. All segments
contributed to this remarkable expansion, which accounted for 55% of the
total Company revenue increase of the quarter. In Embedded software and
Products activities, revenue reached €483 million, up +5%, with solid
developments in all main segments.
Total Company revenue expansion was +10% at constant exchange rates and
+4% at historical exchange rates. During the third quarter, effects of
currency movements were significant due to the cumulative negative
effect of fluctuations in exchange rates against the Euro of most
currencies used by the Company in its activities, such as the American
dollar (-6%), Brazilian real (-16%), British pound (-7%), Japanese yen
(-25%) or South African rand (-22%).4
Revenue variations by segment and by region, at constant and historical
exchange rates, are presented in appendix 1 and 2. Average exchange
rates between the Euro and the US Dollar are presented in appendix 5.
2 "Mobile" includes the Mobile Communication and
Machine-to-Machine segments3 "Payment & Identity"
includes the Secure Transactions and Security segments4
Year-on-year variation in the average of monthly closing rates against
the Euro for the third quarter - source: Bloomberg.
Year-on-year variation at constant exchange rates
The Mobile Communication segment posted revenue of €287 million for the
quarter, growing by +9% at constant exchange rates compared to the third
quarter of 2012.
Revenue from Platforms & Services grew by +25%, reaching €53 million.
This growth came mainly from core subscriber services with LTE
subscription management and other remote management services as well as
operator billing services, which complemented the solid momentum in
mobile payment activities.
Embedded software & Products grew by 5% as deployments of LTE programs
continue and demand for multi-tenant SIM cards increases, driving
further mix improvement.
The Machine-to-Machine segment posted revenue of €49 million, an
increase of +9% at constant exchange rates. The increase in activity was
driven by improving demand in the Americas and Europe. The demand for
Cinterion modules and data management services stems from industrial
sectors that are integrating mobile connectivity into their product
offerings to reduce costs, improve data collection and deliver higher
levels of service. The automotive and track & trace sectors as well as
the developments in Platforms & Services initiated in the first
semester, which represent an encouraging albeit, as yet, limited
contribution, all posted positive dynamics during the quarter.
Secure Transactions posted a +18% revenue increase at constant exchange
rates to €162 million, extending the strong growth momentum started
during the first semester of 2013.
A large part of the revenue increase this quarter came from Asian
countries that have begun their migration to EMV technology. More
globally, the deployment of contactless and dual-interface electronic
payment cards continues to grow in proportion, representing close to
half of the quarter's deliveries.
Revenue expansion in Platforms & Services was similar to the segment
growth, driven by projects for mobile payment.
Revenue in Security grew in both the Government Programs and Identity &
Access Management businesses, reaching €98 million, up +5% on top of the
+22% growth posted for the same quarter of 2012. Contracts related to
voter registration and post issuance drove a strong increase in
Platforms & Services sales, and the Embedded software & Products
activity captured new ePassport contracts that were up for renewal in
Europe and Africa.
Operational performance has been restored following the start up phase
of two new facilities in the first semester, and even if quarterly
oscillations in relative growth rates may occur in this dynamic
business, the government contracts backlog remains healthy.
The activity in Patents continues to be limited due to ongoing
litigation initiated by the Company in the United States. As
anticipated, no meaningful revenue was recognized during the third
Identity for citizens - Gemalto announced several developments in the
government identity space including new wins in both Embedded software &
Products and Platforms & Services.
Machine-to-Machine - Several developments in the space reinforce Gemalto
leadership in that market as well as its ability to partner within the
ecosystem to facilitate the expansion of the internet of things.
Related press releases:
October 1, 2013: Gemalto selected for Belgian ePassportSeptember
24, 2013: Gemalto, Oracle and V2COM Collaborate to Deliver M2M
Technology for Smart Grid Solutions in Latin AmericaSeptember 23,
2013: Gemalto's new M2M development kit boosts innovation in the
Internet of ThingsSeptember 16, 2013: Imprimerie Nationale selects
Gemalto for the French electronic driving licenseSeptember 3,
2013: Gemalto automatic border management solution live at Oslo AirportAugust
1, 2013: Gemalto and KORE enable global connectivity and M2M
applications with cloud-based service platformJuly 18, 2013:
Gemalto Honored with Connected World 2013 Gold Value Chain Award for
Facilitating Innovative M2M Technology
For the full year 2013 Gemalto anticipates double-digit expansion in
both profit from operations and revenue at constant exchange rates.
Increased investment in operations to drive business development beyond
2013 should lead to a more pronounced seasonality in profit from
operations between the two semesters.
Live Audio Webcast and Conference call
Gemalto third quarter 2013 revenue presentation will be webcast in
English today at 3pm Amsterdam and Paris time (2pm London time and
9am New York time).
This listen-only live audio webcast of the presentation and the Q&A
session will be accessible from our Investor Relations web site:
Questions will be taken by way of conference call. Investors and
financial analysts wishing to ask questions should join the presentation
The accompanying presentation slide set is also available for download
on our Investor Relations web site.
Replays of the presentation and Q&A session will be available in webcast
format on our Investor Relations web site approximately 3 hours after
the conclusion of the presentation. Replays will be available for one
The full year 2013 results will be reported on Thursday March 6, 2014,
before the opening of Euronext Amsterdam.
Stock Exchange Listing
Gemalto N.V. is dual listed on NYSE Euronext Amsterdam and Paris, in the
compartment A (Large Caps).
Gemalto has also established a sponsored Level I American Depository
Receipt (ADR) Program in the United States since November 2009. Each
Gemalto ordinary share is represented by two ADRs. Gemalto's ADRs trade
in U.S. dollar and give access to the voting rights and to the dividends
attached to the underlying Gemalto shares. The dividends are paid to
investors in U.S. dollar, after being converted into U.S. dollar by the
depository bank at the prevailing rate.
Gemalto (Euronext NL0000400653 GTO) is the world leader in digital
security with 2012 annual revenues of €2.2 billion and more than 10,000
employees operating out of 83 offices and 13 Research & Development
centers, located in 43 countries.
We are at the heart of the rapidly evolving digital society. Billions of
people worldwide increasingly want the freedom to communicate, travel,
shop, bank, entertain and work - anytime, everywhere - in ways that are
enjoyable and safe. Gemalto delivers on their expanding needs for
personal mobile services, payment security, authenticated cloud access,
identity and privacy protection, eHealthcare and eGovernment efficiency,
convenient ticketing and dependable machine-to-machine (M2M)
applications. We develop secure embedded software and secure products
which we design and personalize. Our platforms and services manage these
products, the confidential data they contain and the trusted end-user
services made possible.
Our innovations enable our clients to offer trusted and convenient
digital services to billions of individuals. Gemalto thrives with the
growing number of people using its solutions to interact with the
digital and wireless world.
For more information visit
blog.gemalto.com, or follow @gemalto on Twitter.
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: trends
in wireless communication and mobile commerce markets; the Company's
ability to develop new technology and the effects of competing
technologies developed; effects of the intense competition in the
Company's main markets; 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,
platforms and services; profitability of the expansion strategy; effects
of acquisitions and investments; ability of the Company's to integrate
acquired businesses, activities and companies according to expectations;
ability of the Company to achieve the expected synergies from
acquisitions; 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 or its representatives 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
required by applicable law or regulations.
All variations in these appendices are comparing the revenue of the
third quarter 2013 to the revenue of the third quarter 2012. For a
better understanding of Gemalto's year-on-year business evolution, the
revenue figures have been calculated for ongoing operations, as
described in the basis of preparation of this document, unless otherwise
Revenue variations at constant and historical exchange rates
Year-on-year variation at historical exchange rates
Revenue from ongoing operations, by region
Ongoing operations(€ in millions)
Year-on-year variation atconstant exchange rates
Year-on-year variation athistorical exchange rates
Revenue from ongoing operations and all operations
Revenue(€ in millions)
Year-to-date revenue and year-on-year variations at constant exchange
Year-to-date revenue at the end of Q3 2013(€ in millions)
Average exchange rates between the Euro and the US dollar
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