TomTom Reports a Loss, Writes Down TeleAtlas
TomTom announced some bad news today as they offered a loss and a write-down on the TeleAtlas acquisition. TomTom lost 989 Million Euros in the last quarter compared to a profit of 107 Million Euros a year earlier. This was on the back of a 17% loss in topline sales in the quarter, apparently in line with earnings estimates. They also wrote off about a billion Euros from teh value of the TeleAtlas acquisition, while admitting that they overpaid for the map maker.
As TomTom moves forward, they indicated that their HD launch has been going well, with about 25% of their HD Traffic customers renewing their subscriptions after a year's time. That is not bad, but I would have hoped for a higher rate. It all depends on what their financial models say, but once you have the purchase made, one would hope to keep that person as a customer. TomTom indicated that they are going to be working on more services sales this year, maybe they are thinking the same thing. Reportedly they have 130,000 customers.
TomTom also commented on the fact that they believe that they are going to comply with their loan agreements, but it sounds like if the market deteriorates more, they could see an issue moving forward with that debt load.
Read More in: Earnings Announcements | TomTom GPS News
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Posted by Scott Martin at February 24, 2009 7:59 PM
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