February 12, 2007

NAVTEQ Earnings up 24%

NAVTEQ Corporation reported record revenue and operating income for the fourth quarter; revenue in the quarter rose 24% over the fourth quarter of 2005 to $180.7 million. Operating income grew 51% over the prior year to $62.8 million. Net income was up 55% over last year's fourth quarter to $42.9 million. Earnings per diluted share grew 54% to $0.45, compared to $0.29 in the prior year's quarter. Things look good for the mapmaker. With volumes surging in GPS units, it's not a surprise that things are surging in the mapmaking area too. Concern going forward would be margin pressure as more and more value GPS units come out and push the suppliers to lower their margins. I recently learned that in a typical GPS unit, map data can cost upwards to $50 for the initial license. That's a big chunk out of a $200 retail priced GPS.

For the full year 2006, revenue was $581.6 million, representing growth of 17% over 2005. Operating income for the full year grew 14% to $153.7 million. Net income for 2006 was $110.0 million, compared to $170.8 million in 2005. Earnings per diluted share for the year totaled $1.15, compared to $1.81 in 2005.

"The fourth quarter brought to a close another exciting year for GPS technology and digital maps," said Judson Green, President and Chief Executive Officer. "We continued to grow our geographic footprint, rolled out important technology enhancements, and announced two important acquisitions that will expand our portfolio of content. While 2006 was a challenging year, we believe that our many accomplishments have positioned us well for continued success in the years ahead."

Full year net income and earnings per diluted share for 2006 were significantly lower than in 2005 due in part to the recording of a net income tax benefit of $80.6 million, or $0.85 per diluted share, during the third quarter of 2005. The recording of this benefit was primarily related to the reversal of the company's valuation allowance on deferred tax assets associated with net operating loss and deferred interest carryforwards in the U.S.

NAVTEQ revenue from the Europe, Middle East & Africa (EMEA) region totaled $113.6 million in the quarter, up 34% from the fourth quarter of 2005. For the full year, EMEA revenue was $360.1 million, an increase of 14% over 2005. Excluding the impact of foreign currency rate fluctuation, EMEA revenue for the fourth quarter and full year 2006 grew 25% and 12%, respectively. Revenue for the Americas region was $66.3 million in the quarter, a 17% increase over the fourth quarter of 2005. For the full year, Americas revenue was $216.2 million, representing 25% growth over 2005. Asia Pacific revenue was $0.8 million in the quarter and $5.4 million for the full year.

Cash and marketable securities totaled $322.5 million at December 31, 2006. Net cash provided by operating activities for 2006 was $140.0 million.