TomTom warns on sales but maintains 2016 earnings target

TomTom on Thursday said sales of its personal navigation devices (PNDs) had been weaker than expected in the third quarter compared with the first half of 2016 and it lowered its full-year sales target to €980 million from €1.05 billion.

But the company said its high-margin services were growing, and it expected it would still meet a full-year target for adjusted earnings per share of €0.23.

“The European PND market is experiencing a faster rate of unit decline compared with what we have seen in the first half of the year and we now expect this market in units to be down by about 20 per cent for the year as a whole,” TomTom said in a statement.

The company released preliminary earnings for the third quarter which showed a 6 per cent decline in sales to €239 million.

Earnings before interest, tax, depreciation and amortisation were down 1 per cent at €33.1 million.

Among other the company’s other major business lines, each of which make up a little less than 20 per cent of sales, sales at the automotive business rose by 21 per cent; its telematics, or auto fleet management business boosted sales by 15 per cent; and sales at its map-licensing business shrank by 2 per cent.

TomTom is due to publish full third-quarter results on October 21st. – (Reuters)