Financial news
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03 Sep 2010
Upswing in global demand driven by broad industry trend towards location awareness
Strong customer confidence
u-blox continued its successful dual-technology strategy to provide customers with GPS positioning solutions together with wireless communications modules, achieving widespread market acceptance and high customer demand for both GPS and wireless products worldwide. Highlights include:
Products and innovation
During the first half of 2010 u-blox continued to upgrade existing products while developing new ones to serve its customers’ continuing demands for smaller-size, higher performance, and compatibility with the latest wireless communications standards and technology. Here are some of the highlights:
Logistics and infrastructure
People
After an increase in staff during 2009 due mainly to acquisitions, the number of employees worldwide remained at the same level during the first half of 2010, with a headcount of 199 people.
Finance
Consolidated income statement
(in CHF 000s) |
Jan. - June |
Jan. - June |
Jan. - Dec. |
|
|
|
|
Revenue |
49'251 |
34’131 |
73’527 |
Cost of revenue |
-23'056 |
-15’713 |
-34’644 |
Gross profit |
26'195 |
18’418 |
38’883 |
Distribution and marketing expenses |
-6'905 |
-6’226 |
-13’014 |
Research and development expenses |
-9'736 |
-7’664 |
-16’195 |
General and administrative expenses |
-2’728 |
-2'304 |
-4’572 |
Other income |
779 |
33 |
84 |
Profit from operations (EBIT) |
7’605 |
2'257 |
5’186 |
Financial income |
580 |
165 |
251 |
Finance costs |
-672 |
-610 |
-1’490 |
Profit before income tax (EBT) |
7’513 |
1'812 |
3’947 |
Income tax expense |
-1’472 |
-274 |
-621 |
Net profit for the period |
6’041 |
1'538 |
3’326 |
|
|
|
|
Earnings per share (in CHF) |
0.97 |
0.25 |
0.53 |
Diluted earnings per share (in CHF) |
0.96 |
0.25 |
0.53 |
Revenue by segment
u-blox operates in two segments:
Expanded global presence
To meet the huge market demand for government-mandated Automatic Vehicle Location (AVL) devices in Brazil, u-blox announced in the beginning of the second half of 2010 that it has expanded its production capacity with a contract manufacturer in Brazil. This step allows u-blox to streamline logistics and respond faster to customers in this market.
Outlook
The continued recovery of the world economy after a prolonged recession is resulting in a clear upswing. The company is experiencing growing interest in both GPS and wireless product families.
For the full year 2010, u-blox increases its revenue guidance and anticipates year-on-year revenue growth of 50% to CHF 110 million with an EBIT margin of approximately 15% (up from the previous guidance for EBIT of CHF 6 million). The outlook is based on the assumption that the company can meet customer demand despite certain capacity constraints in the supply chain and that exchange rates remain constant.
With over 3’000 customers across the world in a broad range of consumer, industrial and automotive sectors, u‑blox is well-positioned to capitalize on technology trends in numerous sectors, especially the continued emergence of new products with combined GPS and wireless communications capabilities such as emergency call and AVL systems, personal tracking and emergency locator devices, location-aware netbooks, smartphones and handheld consumer devices.
After passing the recession with positive results, the company is optimistic that the strong upswing experienced in the first half year will continue to accelerate, and we look forward to doing very successful business during the remainder of 2010 and beyond.