Gemalto first semester 2016 results
(Thomson Reuters ONE) -
* Revenue of ?1.5 billion, up +1% at constant exchange rates and stable at
historical exchange rates
* Revenue growth in Government Programs up +25%, Enterprise up +12%, Payment
up +11% and Machine-to-Machine up +9%, at constant exchange rates, fully
offsets lower sales to mobile network operators
* Gross margin increases by +92 basis points, confirming 2016 outlook
* Strong free cash flow generated, up +?128 million compared to first semester
of 2015
To better assess past and future performance, the income statement is
presented on an adjusted basis and variations in revenue figures above and in
this document are at constant exchange rates except where otherwise noted (see
page 2 "Basis of preparation of financial information"). Non-GAAP financial
measures are not meant to be considered in isolation or as a substitute for
comparable IFRS measures and should be read only in conjunction with the
consolidated financial statements. Reconciliation with the IFRS income
statement is presented in Appendix 1. The statement of financial position is
prepared in accordance with IFRS, and the cash position variation schedule is
derived from the IFRS cash flow statement. All figures in this press release
are unaudited.
Amsterdam, August 26, 2016 - Gemalto (Euronext NL0000400653 - GTO), the world
leader in digital security today announces its results for the first semester
2016.
Key figures of the adjusted income statement
Year-on-year variations
First semester First semester at historical at constant
(? in millions) 2016 2015 exchange rates exchange rates
Revenue 1,495 1,499 = +1%
Gross profit 586 574 +2%
Operating (415) (414) =
expenses
Profit from 172 160 +8%
operations
Profit margin 11.5% 10.6% +84bp
Olivier Piou, Chief Executive Officer, and Philippe Vallée, Chief Operating
Officer, commented: "Gemalto progressed well in the first semester. The Payment
& Identity segment saw another significant +14% growth, with all its businesses
growing at double-digit rates, fully offsetting lower sales in Mobile segment.
The Platforms and Services activity also posted a strong performance, with
revenue up by +20% year-on-year, and on its way to reaching one year ahead of
schedule the 1 billion euro yearly Platforms and Services revenue challenge we
had set for ourselves in 2013. This further illustrates the success of the
Gemalto's diversification and the acceleration of its structural transformation.
We will continue to focus our efforts and investment on our highest growing
businesses, and are confident in a further increase in gross margin. Entering
the last stretch of our current multi-year development plan, Gemalto will begin
the planning processes which will define its next milestones."
Basis of preparation of financial information
Segment information
The Mobile segment reports on businesses associated with mobile cellular
technologies including Machine-to-Machine, mobile secure elements (SIM, embedded
secure element) and mobile Platforms & Services. The Payment & Identity segment
reports on businesses associated with secure personal interactions including
Payment, Government Programs and Enterprise. The SafeNet acquisition in 2015 is
part of the Enterprise business.
In addition to this segment information the Company also reports revenues of
Mobile and Payment & Identity by type of activity: Embedded software & Products
(E&P) and Platforms & Services (P&S).
Historical exchange rates and constant currency figures
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
these other currencies exchange rates against the Euro have in particular 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. Revenue variations are at constant exchange rates and include
the impact of currencies variation hedging program, except where otherwise
noted. All other figures in this press release are at historical exchange rates,
except where otherwise noted.
Adjusted income statement and profit from operations (PFO) non-GAAP measure
The consolidated financial statements are prepared in accordance with the
International Financial Reporting Standards (IFRS).
To better assess its past and future performance, the Company also prepares an
adjusted income statement where the key metric used to evaluate the business and
make operating decisions over the period 2010 to 2017 is the profit from
operations (PFO).
PFO is a non-GAAP measure defined as IFRS operating profit adjusted for (i) the
amortization and depreciation of intangibles resulting from acquisitions, (ii)
restructuring and acquisition-related expenses, (iii) all equity-based
compensation charges and associated costs; and (iv) fair value adjustments upon
business acquisitions. These items are further explained as follows:
* Amortization and depreciation of intangibles resulting from acquisitions are
defined as the amortization and depreciation expenses related to the
intangibles recognized as part of the allocation of the excess purchase
consideration over the share of net assets acquired.
* Restructuring and acquisitions-related expenses are defined as (i)
restructuring expenses which are the costs incurred in connection with a
restructuring as defined in accordance with the provisions of IAS 37 (e.g.
sale or termination of a business, closure of a plant,.), and consequent
costs; (ii) reorganization expenses defined as the costs incurred in
connection with headcount reductions, consolidation of manufacturing and
offices sites, as well as the rationalization and harmonization of the
product and service portfolio and the integration of IT systems, consequent
to a business combination; and (iii) transaction costs (such as fees paid as
part of an acquisition process).
* Equity-based compensation charges are defined as (i) the discount granted to
employees acquiring Gemalto shares under Gemalto Employee Stock Purchase
plans; (ii) the amortization of the fair value of stock options and
restricted share units granted by the Board of Directors to employees; and
the related costs.
* Fair value adjustments over net assets acquired are defined as the reversal
in the income statement of the fair value adjustments recognized as a result
of a business combination, as prescribed by IFRS3R. Those adjustments are
mainly associated with (i) the amortization expense related to the step-up
of the acquired work-in-progress and finished goods assumed at their
realizable value and (ii) the amortization of the cancelled commercial
margin related to deferred revenue balance acquired.
These non-GAAP financial measures are not meant to be considered in isolation or
as a substitute for comparable IFRS measures and should be read only in
conjunction with our consolidated financial statements prepared in accordance
with IFRS.
In the adjusted income statement, Operating Expenses are defined as the sum of
Research and Engineering expenses, Sales and Marketing expenses, General and
Administrative expenses, and Other income (expense) net.
EBITDA is defined as PFO plus depreciation and amortization expenses, excluding
the above amortization and depreciation of intangibles resulting from
acquisitions.
Adjusted financial information
The interim condensed consolidated financial statements are prepared in
accordance with International Financial Reporting Standards (IFRS) as adopted by
the European Union. To better assess its past and future performance, the
Company also prepares an adjusted income statement.
First semester 2016 First semester 2015
Extract of Year-on-year variations
the
adjusted ? in As a % of ? in As a % of at at
income millions revenue millions revenue historical constant
statement exchange exchange
rates rates
Revenue 1,495.2 1,499.1 = +1%
Gross profit 586.3 39.2% 574.0 38.3% +92 bp
Operating (414.6) (27.7%) (414.4) (27.6%) (9 bp)
expenses
EBITDA 239.3 16.0% 219.6 14.6% +1.4 ppt
Profit from 171.7 11.5% 159.6 10.6% +84 bp
operations
Net profit 107.2 7.2% 105.7 7.1% +12 bp
Basic
Earnings per 1.20 1.21 =
share (?)
Diluted
Earnings per 1.19 1.19 =
share (?)
Total revenue for the first semester 2016 came in at ?1,495 million, up +1% at
constant exchange rates and stable at historical exchange rates.
In the first semester of 2016, currency translation effects generated a negative
(1) percentage point effect on the revenue generation with a contrasted
quarterly pattern. The impact was +1 percentage point increase in the first
quarter of 2016, and (3) percentage points reduction in the second quarter of
2016 due to the combined year-on-year depreciation of the US dollar, Chinese
yuan, British pound and Brazilian real versus the euro. The hedging program,
which aims at partially neutralizing the impact of currency variations on the
Company's profit from operations, produced a 0.2 percentage point offset in the
revenue comparison to the same semester last year.
Gross profit was up by ?12 million, to ?586 million, representing gross margin
of 39.2%, up +92 basis points year-on-year, a step forward towards the Company's
2016 outlook. The increase in gross margin came mainly from the Payment &
Identity segment and in particular the Payment and Enterprise businesses.
Operating expenses were up slightly, by ?0.2 million, at ?415 million. Resources
are being internally shifted to address the Company's most rapidly growing
businesses.
As a result, profit from operations was ?172 million, up ?12 million year-on-
year, representing 11.5% profit margin, and an 84 basis points improvement when
compared to the first semester of 2015.
Gemalto's financial income was (?23) million compared to (?14) million in the
first semester of 2015 as interest expense, foreign exchange transactions and
other financial items increased. Adjusted income tax expense was (?29) million
in the first semester of 2016, resulting in an adjusted net profit of the
Company of ?106 million, stable year-on-year.
Consequently, adjusted basic earnings per share came in at ?1.20 and adjusted
diluted earnings per share were at ?1.19, stable when compared to the first
semester of 2015.
IFRS results
Amortization and depreciation of intangibles resulting from acquisitions
increased by (?6) million year-on-year, to (?29) million, mainly due to the Trüb
and SafeNet acquisitions. Restructuring and acquisition-related expenses
decreased by ?5 million to (?14) million, and came mainly from the IT and
facilities integration costs of SafeNet and Trüb and from the implementation of
a new information system (ERP) to harmonize finance and reporting systems. The
equity-based compensation charge evolved to (?19) million versus (?17) million
for the same period of last year. Fair value adjustments related mainly to the
non-cash amortization of the IFRS revaluation of SafeNet's pre-acquisition
deferred revenue accounted for (?2) million for the first semester 2016 compared
to (?67) million for the same period last year.
Gemalto hence recorded an increase of ?75 million in its IFRS operating profit
(EBIT), at ?108 million for the first semester of 2016 compared to ?33 million
in the first semester of 2015. This performance highlights both the increase in
operating profitability and the now marginal effect of the non-cash IFRS fair-
value adjustments related to the SafeNet's pre-acquisition deferred revenue.
Consequently the IFRS net profit increased four-fold, coming in at ?58 million
for the first semester of 2016 versus ?14 million in the first semester of 2015.
As a result, IFRS basic earnings per share and diluted earnings per share for
the first semester 2016 grew four-fold at ?0.65 and ?0.65 respectively compared
to ?0.16 and ?0.15 in the first semester of 2015.
Statement of financial position and cash position variation schedule
In the first semester of 2016, operating activities generated a cash flow of
?177 million before changes in working capital, lower compared to ?199 million
in 2015 mainly due to an increase in tax payment. Changes in working capital
reduced cash flow by (?43) million, less than during the same period of 2015 at
(?57) million.
Capital expenditure and acquisition of intangibles reduced by ?29 million to
(?75) million, representing 5.0% of total Company revenue versus 6.9% of revenue
in the same period of 2015.
Property, Plant, and Equipment reduced by ?18 million to (?34) million, compared
to the high level of last year which related to the initial investments made to
support the strong start of the payment business in the United States.
Acquisition and capitalization of intangible assets represented a net cash
outflow of ?41 million compared to ?52 million for the first semester of 2015,
with capitalization of development expenses representing 1.9% of revenue.
As a result, in the first semester of 2016, the Company generated free cash flow
of ?64 million compared to a (?64) million outflow for the same period of 2015,
up +?128 million year-on-year.
Acquisitions used ?3 million in cash during the first semester of 2016, versus
?888 million during the same period of 2015 which had seen the closing of both
the SafeNet and Trüb acquisitions.
Gemalto's share buy-back and liquidity programs generated a (?0.3) million net
cash outflow for the first semester of 2016. As at June 30, 2016, the Company
held 861,474 shares, i.e. 1.0% of its own shares in treasury. The total number
of Gemalto shares issued increased by +886,199 this semester, to 89,893,908
shares. Net of the 861,474 shares held in treasury, 89,032,434 shares were
outstanding as at June 30, 2016.
On May 26, 2016, Gemalto paid a cash dividend of ?0.47 per share in respect of
the fiscal year 2015, up +12% on the dividend paid in May 2015 which was of
?0.42 per share. This May 2016 distribution used ?42 million in cash. Net
repayment of financing instruments generated a ?22 million cash outflow, mainly
from debt repayment.
Cash in hand, net of bank overdrafts amounted to ?400 million as at June
30, 2016.
Considering the ?734 million total amount of borrowings as at June 30, 2016,
Gemalto's net debt position reduced to ?334 million compared to a net debt
position of ?490 million as at June 30, 2015. This significant (?156) million
variation is due to the strong free cash flow generated by the Company during
the last twelve months.
Segment information
Revenue variations are expressed at constant currency exchange rates unless
otherwise noted.
Year-on-year variations Payment & Total two main Patents &
and currencies impact Identity Mobile segments Others Total
(? in millions)
Second quarter
Revenue 504 299 803 1 804
At constant rates +11% (5%) +5% (94%) +3%
At historical rates +7% (7%) +1% (94%) (1%)
First semester
Revenue 937 557 1,494 1 1,495
At constant rates +14% (13%) +2% (92%) +1%
At historical rates +12% (13%) +1% (92%) =
As a percentage of total 63% 37% 100% 0% 100%
revenue
During the second quarter, revenue expanded by +3% at constant exchange rates
and was (1%) lower at historical exchange rates. The strong growth in Payment &
Identity segment revenue, up +11% at constant exchange rates, continued in the
second quarter and was supported by all its businesses, i.e. Payment, Government
Programs and Enterprise. The Mobile segment revenue was lower by (5%) at
constant exchange rates in the second quarter of 2016, following the steep (20%)
year-on-year reduction recorded in the first quarter of 2016. The second quarter
improvement in the Mobile segment revenue pattern comes from the slower decline
in SIM sales, the continued increase in Machine-to-Machine revenue and the year-
on-year growth in the Mobile segment's Platforms & Services activity.
Overall, the diversification of the Company has been reinforced this semester by
the +14% growth at constant exchange rates of the Payment & Identity segment,
offsetting the lower (13%) sales in the Mobile segment. Payment & Identity at
63% now represents almost two-thirds of the Company revenue, compared to 56% in
the same period last year.
Contribution by
activity
First semester 2016 Embedded software
& Platforms & Total two main Patents &
(? in millions, Products Services segments Others
variations at
constant exchange
rates)
Revenue 1,010 484 1,494 1
Year-on-year revenue (4%) +20% +2% (92%)
growth
As a percentage of 68% 32% 100% 0%
revenue
Embedded software & Products revenue reduced by (4%) due to lower SIM sales to
mobile network operators and lower payment cards revenue in China. The
structural transformation of the Company accelerated with the Platforms &
Services activity posting a strong +20% growth in the first semester of 2016, to
now represent 32% of total Company revenue, compared to 27% a year ago. The
Platforms & Services year-on-year revenue expansion at constant exchange rates
came from both the Payment & Identity and Mobile segments. In the Payment &
Identity segment, contribution to revenue growth came from all three business
lines, with an increase in Payment issuance services, in eGovernment services
and in the Enterprise cybersecurity solutions sales.
Profit from operations Total Payment & Mobile
(? in millions) (including Patents & Others) Identity
First semester 172 118 59
As a percentage of the total 100% 69% 34%
profit from operations
Year-on-year variation +8% +53% (17%)
First semester profit from operations increased by +8% year-on-year. As a result
of the gross margin improvement, the Payment & Identity segment profit from
operations increased by ?41 million, up +53% compared to first semester of
2015. The Payment & Identity profit from operations expansion largely offset the
lower contribution from both the Mobile and the Patents & Others segments. The
Payment business has been the main contributor to the profit from operations
increase, benefitting from the optimization of the United States EMV operations
after the particularly rapid ramp-up reported during previous semesters. The
contribution of the Payment & Identity segment is now 69% of the total Company
profit from operations, clearly illustrating the balanced profile of the
Company.
Payment & Identity
First semester 2016 First semester 2015 Year-on-year variations
at at
? in As a % of ? in As a % of historical constant
millions revenue millions revenue exchange exchange
rates rates
Revenue 936.8 840.2 +12% +14%
Gross profit 374.0 39.9% 310.5 37.0% +3.0 ppt
Operating (255.8) (27.3%) (233.1) (27.7%) +0.4 ppt
expenses
Profit from 118.2 12.6% 77.5 9.2% +3.4 ppt
operations
Payment & Identity's first semester revenue came in at ?937 million, increasing
by +14% at constant exchange rates compared to the same period in 2015. The
segment's Embedded software & Products sales were up by +7% at ?576 million and
its Platforms & Services sales increased to ?361 million, up +27%.
The Payment business grew by +11% reaching ?503 million. The Americas posted the
largest revenue growth, on strong sales of EMV payment cards and rapid expansion
of issuance services in the United States, offsetting the lower sales in Asia.
Gemalto also saw the early stage interest for dual interface cards in the United
States, with the particularly rapid delivery of a significant project for a
customer portfolio. Payment Embedded software & Products sales were stable and
Payment Platforms & Services revenue expanded by +60% compared to first semester
2015.
Revenue from the Enterprise business came in at ?217 million for the first
semester of 2016, up +12%. The revenue improvement came from all three business
lines, Encryption, Authentication and Software Monetization. To meet the
increasing market demand for cybersecurity solutions, the Enterprise business is
quickly increasing its sales coverage, expanding Gemalto's ecosystem of
technology partners and accelerating investment in R&D in order to rapidly
strengthen the Company's offering in this growing sector.
The Government Programs business was up +25%, at ?217 million. In addition to
Trüb's contribution in the first quarter, sales expansion came mostly from
delivery commencements of previously won projects in all regions and project
backlog continued to expand. Government Programs' Embedded software & Products
revenue was up +23%, and its Platforms & Services sales were up +30% compared to
the first semester of 2015.
Overall, the Payment & Identity segment's gross margin improved to 40%, up +3.0
percentage points compared to the first semester of 2015. The largest
contribution to this performance came from the optimization of the Payment
business.
Operating expenses grew to (?256) million in the first semester of 2016, from
(?233) million in the first semester of 2015. This was largely due to the
increased investments in the Enterprise business, the addition of the Trüb
expenses of the first quarter of 2016, as well as to the shift of internal
resources from the Mobile segment's SIM business to the Payment & Identity
segment in order to address the rapid growth of its different businesses.
As a result, profit from operations in Payment & Identity for the first semester
2016 came in at ?118 million, up +53% from the ?77 million recorded in the first
semester of 2015. Profit from operations margin increased to 12.6%, up +3.4
percentage points compared to 9.2% in the first semester of 2015.
Mobile
First semester 2016 First semester 2015 Year-on-year variations
at at
? in As a % of ? in As a % of historical constant
millions revenue millions revenue exchange exchange
rates rates
Revenue 556.8 641.3 (13%) (13%)
Gross profit 212.0 38.1% 246.2 38.4% (0.3 ppt)
Operating (153.1) (27.5%) (175.2) (27.3%) (0.2 ppt)
expenses
Profit from 58.9 10.6% 71.0 11.1% (0.5 ppt)
operations
The Mobile segment posted revenue of ?557 million for the first semester of
2016. Revenue was lower by (13%) at constant exchange rates compared to the same
period of 2015.
Embedded software & Products sales for the segment came in at ?434 million,
lower by (16%) at constant exchange rates. SIM sales declined by (26%) at ?282
million for the first semester, with a (16%) year-on-year decrease in the second
quarter. This was mainly due to the tail-end effect in the first quarter of
2016 of the United States operators' mobile payment venture closing, coupled
with lower demand in Latin America and Asia. Revenue derived from SIM products
now represents less than one fifth of total Company revenue. Conversely, the
Machine-to-Machine (M2M) business continued to grow, up +9% year-on-year at ?153
million, in line with the expanding global demand of connected devices and
embedded secure elements for the Internet of Things (IoT). The certifications of
Gemalto M2M "Cat 1" wireless modules by several major Mobile Network Operators
and the launch of the world's first Voice over LTE (VoLTE) Cat 1 modules
associated with important new design wins during the semester continue to drive
the business expansion across sectors and regions.
The Platforms & Services revenue for the Mobile segment grew by +15% in the
second quarter of 2016 compared to the second quarter of last year. This led to
a +3% year-on-year revenue expansion for the first semester, at ?123 million,
fully offsetting the adverse effect in Mobile Platforms & Services of the United
States operators' mobile payment venture closing last year. Since the adoption
of GSMA specifications related to embedded SIMs (eSIMs) remote activation and
management for both the Machine-to-Machine and secondary devices for consumer
market, Gemalto's Mobile Subscriber Services business has made significant
progress, with several key projects wins announced. In particular, Gemalto has
been selected to provide its On-Demand Connectivity (ODC) subscription
management solution for KDDI, a leading operator in Japan, to enable secure
connectivity for connected cars and IoT applications worldwide. Gemalto has also
recently provided the ODC service to Orange for the connected Samsung Gear S2
smartwatch, allowing users to securely and indiscernibly connect to their
cellular network. Gemalto is fully involved in this global interoperability
effort, bringing its technical expertise and neutrality to help both device
manufacturers and mobile network operators best align the ecosystem's
participants objectives.
Gross margin for the Mobile segment decreased slightly, to 38.1% this semester
from 38.4% in the first semester of 2015, mainly due to the expansion in the
traditionally lower gross margin Machine-to-Machine business.
Operating expenses decreased significantly, to (?153) million this semester from
(?175) million in the first semester of 2015 as a result of the shift of part of
the segment's resources to the rapidly growing Payment and Identity businesses.
As a result, the Mobile segment's profit from operations for the first semester
of 2016 was ?59 million, compared to the ?71 million posted in the same period
of last year. The segment's profit from operations margin came in at 10.6%,
compared to 11.1% in the first semester of 2015.
Patents & Others
First semester 2016 First semester 2015 Year-on-year variations
at at
? in As a % of ? in As a % of historical constant
millions revenue millions revenue exchange exchange
rates rates
Revenue 1.5 17.7 (92%) (92%)
Gross profit 0.4 24.6% 17.3 97.7% -
Operating (5.7) - (6.1) (34.6%) -
expenses
Profit from (5.4) - 11.1 63.0% -
operations
The Patents & Others segment, traditionally lumpy, generated ?1 million in
revenue in the first semester of 2016, versus ?17.7 million in the first
semester of 2015. Operating expenses were lower by (?0.4) million, and profit
from operations came in at (?5) million in the first semester of 2016.
Additional information
Below is a highlight of new contracts and achievements published by the Company
in the first semester of 2016
Payment & Identity
January, 19 2016 Finland selects Gemalto for its new secure electronic
passport and eID
February, 2 2016 Gabon selects Gemalto for fully integrated border and
visa system
February, 23 2016 Gemalto releases findings of 2015 Breach Level Index
February, 24 2016 Peru selects the Imprimerie Nationale Group and Gemalto
for end-to-end ePassport program
February, 25 2016 Gemalto expands Security Industry's largest Data
Protection ecosystem
April, 7 2016 Gemalto eBanking solution increases online security for
BBVA Bancomer in Mexico
May, 10 2016 JETCO selects Gemalto to roll out secure Peer-to-Peer
mobile payments in Hong Kong
May, 16 2016 Colorado partners with MIDS, a Gemalto company, for
secure polycarbonate identity credentials
June, 7 2016 Colombia selects Gemalto's secure ePassport solution
Mobile
February, 8 2016 Verizon certifies Gemalto's first Cat. 1 LTE M2M
Solution for IoT
February, 16 2016 Gemalto launches leading edge M2M Cat 1 LTE module with
seamless 2G and 3G fall-back
February, 18 2016 Gemalto and Bridge Alliance, a partnership of 35 leading
operators in Asia, demonstrate GSMA standards-based
solution for multi-country deployment of IoT devices
February, 23 2016 Gemalto and Jasper Partner to Simplify the Global
Deployment of IoT Devices
February, 24 2016 PROSA and Gemalto Partner to Offer Mobile Payments in
Mexico
April, 24 2016 Gemalto and Worldline join forces to make mobile payment
deployment fast and easy
May, 3 2016 Verizon selects Gemalto to migrate to Advanced OTA
technology for 4G LTE services
June, 30 2016 KDDI in Japan selects Gemalto's Connected cars and IoT
solution
Industry Recognitions
January 6, 2016 Gemalto Cat 1 LTE connectivity solution wins Most
Innovative Application Award
January 18, 2016 Gemalto-led e-passport research project wins European
Innovation Award
March 15, 2016 Gemalto Wins "Best Identity Management Platform" in GSN
2015 Homeland Security Awards
May, 25 2016 Gemalto Wins 2016 Cybersecurity Excellence Award for
Best Multi-Factor Authentication Solution
June, 21 2016 Gemalto ePassports ranked #1 for speed in Industry tests
Outlook
For 2016, Gemalto expects to generate a +1.5 percentage point gross margin
increase, accelerating its profit from operations expansion towards its 2017
objectives.
Live Audio Webcast and Conference call
Gemalto first semester 2016 results 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:
www.gemalto.com/investors
Questions will be taken by way of conference call. Investors and financial
analysts wishing to ask questions should join the presentation by dialing:
(UK) +44 203 367 9453 or (US) +1 855 402 7761 or (FR)
+33 1 7077 0942
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 year.
The semi-annual report, including the interim condensed consolidated financial
statements as of June 30, 2016, is available on our investor web site
(www.gemalto.com/investors).
Reporting calendar
Third quarter 2016 revenue will be reported on Friday October 28, 2016, before
the opening of Euronext Amsterdam.
Stock Exchange Listing
Gemalto N.V. is dual listed on Euronext Amsterdam and Paris, in the compartment
A (Large Caps).
Mnemonic: GTO
Exchange Dual listing on Euronext Amsterdam and Paris
Market of reference Euronext Amsterdam
ISIN Code NL0000400653
Reuters GTO.AS
Bloomberg GTO:NA
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.
Structure Sponsored Level I ADR
Exchange OTC
Ratio (ORD:DR) 1:2
DR ISIN US36863N2080
DR CUSIP 36863N 208
|Investor Relations |Corporate Communication Media Relations Agency
| |
| |
| |
|Winston Yeo |Isabelle Marand Suzanne Bakker
|M.: +33 6 2947 0814 |M.: +33 6 1489 1817 M. : +31 6 1136 8659
|winston.yeo(at)gemalto.com |isabelle.marand(at)gemalto.com suzanne.bakker(at)citigateff.nl
| |
Sébastien Liagre
M.: +33 6 1751 4467
sebastien.liagre(at)gemalto.com
About Gemalto
Gemalto (Euronext NL0000400653 GTO) is the global leader in digital security,
with 2015 annual revenues of ?3.1 billion and customers in over 180 countries.
We bring trust to an increasingly connected world.
Our technologies and services enable businesses and governments to authenticate
identities and protect data so they stay safe and enable services in personal
devices, connected objects, the cloud and in between.
Gemalto's solutions are at the heart of modern life, from payment to enterprise
security and the internet of things. We authenticate people, transactions and
objects, encrypt data and create value for software - enabling our clients to
deliver secure digital services for billions of individuals and things.
Our 14,000+ employees operate out of 118 offices, 45 personalization and data
centers, and 27 research and software development centers located in 49
countries.
For more information visit
www.gemalto.com, or follow (at)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 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.
Appendix 1
Reconciliation from IFRS to Adjusted financial information
|
Six-month period ended June |
30 2016 |
(? in millions) | Basic Diluted
---------+
Weighted average number of shares 88,320 89,340
outstanding (in thousands)
|
| Excluding
IFRS financial information | non-controlling
| interest Basic EPS Diluted EPS
---------+
Operating profit 107,693
Financial income (22,679)
Share of profit /
(loss) from 3,576
associates
Non-recurring profit
/ (loss) relating to (16,887)
associates
Income tax (13,172)
Profit (loss) from
discontinued 0
operation (net of
income tax)
IFRS Net profit for the 58,531 57,744 0.65 0.65
period
|
Reconciliation to adjusted |
financial information |
---------+
Share-based
compensation expense 19,086
and
associated costs
Fair value
adjustment upon 1,635
business acquisition
Restructuring and
acquisition-related 14,074
expenses
Amortization and
depreciation of
intangibles 29,223
resulting from
acquisitions
Profit (loss) from
discontinued 0
operation (net of
income tax)
Income tax (15,340)
|
Adjusted Net profit for the 107,209| 106,422 1.20 1.19
period |
---------+
The first semester 2016 adjusted basic earnings per share is determined on the
basis of the weighted average number of Gemalto shares outstanding during the
six-month period ended June 30, 2016, i.e. 88,320,213 shares. The first semester
2016 adjusted diluted earnings per share is determined by using 89,339,875
shares corresponding to the IFRS treasury stock method, i.e. on the basis of the
same weighted average number of Gemalto shares outstanding and considering that
all outstanding equity-based instruments were exercised (1,414,056 instruments)
and the proceeds received from the instruments exercised (?22,428,933) were used
to buy-back shares at the average share price of the first semester 2016
(394,394 shares at ?56.89).
|
Six-month period ended June |
30 2015 |
(? in millions) | Basic Diluted
---------+
Weighted average number of shares 87,605 88,689
outstanding (in thousands)
|
| Excluding
IFRS financial information | non-controlling
| interest Basic EPS Diluted EPS
---------+
Operating profit 33,141
Financial income (13,686)
Share of profit /
(loss) from 806
associates
Non-recurring profit
/ (loss) relating to 0
associates
Income tax (4,400)
Profit (loss) from
discontinued (2,662)
operation (net of
income tax)
IFRS Net profit for the 13,199 13,734 0.16 0.15
period
|
Reconciliation to adjusted |
financial information |
---------+
Share-based
compensation expense 17,114
and
associated costs
Fair value
adjustment upon 67,271
business acquisition
Restructuring and
acquisition-related 18,790
expenses
Amortization and
depreciation of
intangibles 23,307
resulting from
acquisitions
Profit (loss) from
discontinued 2,662
operation (net of
income tax)
Income tax (37,190)
|
Adjusted Net profit for the 105,153| 105,688 1.21 1.19
period |
---------+
Appendix 2
Interim consolidated statement of financial position
(? in thousands) June 30, December 31,
2016 2015
ASSETS
Non-current assets
Property, plant and equipment, net 339,804 347,994
Goodwill, net 1,525,062 1,524,933
Intangible assets, net 572,315 592,597
Investments in associates 52,110 64,897
Deferred income tax assets 192,949 197,212
Available-for-sale financial assets, net - -
Other non-current assets 61,157 45,585
Derivative financial instruments 1,792 276
Total non-current assets 2,745,189 2,773,494
Current assets
Inventories, net 266,479 273,564
Trade and other receivables, net 952,077 949,690
Derivative financial instruments 19,833 18,048
Cash and cash equivalents 402,785 407,659
-----------------------
Total current assets 1,641,174 1,648,961
-----------------------
Total assets 4,386,363 4,422,455
Equity
Share capital 89,894 89,008
Share premium 1,290,161 1,240,241
Treasury shares (34,399) (36,329)
Fair value and other reserves (26,146) (8,135)
Cumulative translation adjustments 34,245 39,505
Retained earnings 1,175,185 1,158,525
-----------------------
Capital and reserves attributable to the 2,528,940 2,482,815
owners of the Company
-----------------------
Non-controlling interests 6,055 6,716
Total equity 2,534,995 2,489,531
Liabilities
Non-current liabilities
Borrowings 558,309 549,758
Deferred income tax liabilities 109,233 122,817
Employee benefit obligations 138,001 121,958
Provisions and other liabilities 126,132 145,335
Derivative financial instruments 6,676 5,966
-----------------------
Total non-current liabilities 938,351 945,834
-----------------------
Current liabilities
Borrowings 178,116 192,579
Trade and other payables 674,064 718,585
Current income tax liabilities 26,994 33,799
Provisions and other liabilities 18,882 19,366
Derivative financial instruments 14,961 22,761
-----------------------
Total current liabilities 913,017 987,090
-----------------------
Total liabilities 1,851,368 1,932,924
Total equity and liabilities 4,386,363 4,422,455
Appendix 3
Cash position variation schedule
Six-month period ended
June 30
-------------------------------------------------------------------------------
? in millions 2016 2015
-------------------------------------------------------------------------------
----------------------------------------------------------- -------------------
Cash and bank overdrafts, beginning of period 405 1,057
----------------------------------------------------------- -------------------
Cash generated by operating activities, before 177 199
changes in working capital
Net change in working capital (43) (57)
Cash used in restructuring actions and acquisition (16) (19)
related expenses
Net cash generated by operating activities before
Time de-correlated hedging effect / (Prepaid 117 123
derivatives)
Time de-correlated hedging effect / (Prepaid 22 (84)
derivatives)
----------------------------------------------------------- -------------------
Net cash generated by operating activities 139 40
----------------------------------------------------------- -------------------
Capital expenditure and acquisitions of intangibles (75) (104)
----------------------------------------------------------- -------------------
Free cash flow 64 (64)
----------------------------------------------------------- -------------------
Interest received, net (1) 0
Cash used by acquisitions (3) (888)
Currency translation adjustments 1 7
----------------------------------------------------------- -------------------
Cash generated (used) by operating and investing 61 (944)
activities
----------------------------------------------------------- -------------------
Cash generated (used) by the liquidity and share 0 3
buy-back program
Dividend paid to Gemalto shareholders (42) (37)
Net proceed (repayment) from/of financing (22) 179
instruments
Other cash provided (used) by financing activities (2) (2)
----------------------------------------------------------- -------------------
Cash and bank overdrafts, end of period 400 257
----------------------------------------------------------- -------------------
Current and non-current borrowings excluding bank (734) (746)
overdrafts, end of period
------- -------------------
----------------------------------------------------------- -------------------
Net (debt), cash, end of period (334) (490)
-----------------------------------------------------
Appendix 4
Revenue, by region
Year-on-year variations
First semester First semester First semester at constant at historical
? in millions 2016 2015 exchange rates exchange rates
Europe, Middle 635 652 (1%) (3%)
East and Africa
Americas 593 562 7% 5%
Asia 267 285 (5%) (6%)
-------------------------------------------------------------------------------
Total revenue 1,495 1,499 1% 0%
-------------------------------------------------------------------------------
Year-on-year variations
Second quarter Second quarter Second quarter at constant at historical
? in millions 2016 2015 exchange rates exchange rates
Europe, Middle 336 370 (7%) (9%)
East and Africa
Americas 319 292 15% 9%
Asia 149 152 3% (2%)
-------------------------------------------------------------------------------
Total revenue 804 813 3% (1%)
-------------------------------------------------------------------------------
Press release (PDF):
http://hugin.info/159293/R/2037421/759176.pdf
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Gemalto via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 26.08.2016 - 00:00 Uhr
Sprache: Deutsch
News-ID 491249
Anzahl Zeichen: 61715
contact information:
Town:
Meudon
Kategorie:
Business News
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"Gemalto first semester 2016 results"
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