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TomTom reports fourth quarter and full year 2016 results

AMSTERDAM — (BUSINESS WIRE) — February 7, 2017 — Financial summary Q4 '16

Financial summary FY '16

Operational summary

Outlook 2017

Key figures

(€ in millions, unless stated otherwise)   Q4 '16   Q4 '15  

y.o.y.
change

  FY '16   FY '15  

y.o.y.
change

                         
Automotive & Licensing   71.7   69.6   3 %   269.0   248.0   8 %
Telematics 41.6 37.0 12 % 155.1 135.0 15 %
Consumer   152.3     175.9     -13 %   563.2     623.6     -10 %
REVENUE   265.6     282.5     -6 %   987.3     1,006.6     -2 %
                         
GROSS RESULT 153.0 139.0 10 % 566.2 518.5 9 %
Gross margin   58 %   49 %       57 %   52 %    
                         
EBITDA 38.6 41.7 -8 % 140.9 123.7 14 %
EBITDA margin   15 %   15 %       14 %   12 %    
                         
OPERATING RESULT (EBIT) -0.5 0.2 8.9 0.6
EBIT margin   0 %   0 %       1 %   0 %    
                         
NET RESULT -5.6 20.9 12.0 18.3
ADJUSTED NET RESULT   11.3     23.1         54.1     49.6      
                         
EPS, € fully diluted -0.02 0.09 0.05 0.08
Adjusted EPS1, € fully diluted   0.05     0.10         0.23     0.21      

Change percentages and totals calculated before rounding.

This report includes the following non-GAAP measures: gross margin, EBIT (margin), EBITDA (margin), adjusted net result, adjusted EPS and net cash, which are further explained on page 12 of this report.

1 Earnings per fully diluted share count adjusted for acquisition-related expenses & gains on a post-tax basis.
2 In 2016, CAPEX was €118 million and OPEX was €557 million.

TomTom's Chief Executive Officer, Harold Goddijn

“We reported revenue of €987 million in 2016, which is slightly below last year. We are increasing high margin recurring data, software & services business, which now reflects nearly 50% of our revenue mix and more than 70% of our gross result mix. Gross result grew strongly this year with 9%.

Our Automotive products and roadmap continue to be well received, resulting in order intake for 2016 of over €300 million. Order intakes from previous years are now starting to deliver a strong revenue growth in Automotive. We are working with many automotive OEMs and Tier1s to integrate our HD Maps into the self-driving systems they are developing. In early 2017, we acquired Autonomos, a Berlin-based start-up that will give us greater insights and capabilities into the Autonomous Driving software stack.

Telematics reached a subscriber base of nearly 700,000 subscriptions, representing the largest European fleet management business.”

Outlook 2017

In 2017, we expect full year revenue of between €925 million and €950 million. Adjusted EPS1 is expected of around €0.25.

We expect the combined revenue of the Automotive, Licensing and Telematics businesses to grow above 10% year on year in 2017, in line with our previous expectations of their combined revenue CAGR of 15% between 2016 and 2020.

In Consumer, we expect the PND revenue to continue to decline; this will be only partially offset by a growing Sports business.

We expect the level of investments (both CAPEX and OPEX) to show a modest increase compared with 20162, excluding acquisitions. In particular, we are investing in advanced content and software for the automotive industry and in our mapmaking activities.

Financial and business review

We generated revenue of €266 million in the fourth quarter, a decrease of 6% compared with €282 million in Q4 '15. On a full year basis, our revenue was €987 million (FY '15: €1,007 million). Automotive, Telematics and Consumer Sports grew strongly, partially offsetting the reduction in Consumer Drive revenue; Consumer Drive remained the biggest revenue contributor for the group. Licensing business showed a modest decline year on year.

We reported a gross margin of 57% in FY '16 (FY '15: 52%). Operating profit (EBIT) for the year amounted to €9 million (FY '15: €1 million). The net result for the year was €12 million, which translates to adjusted EPS1 of €0.23 in FY '16 (FY '15: €0.21).

1 Earnings per fully diluted share count adjusted for acquisition-related expenses & gains on a post-tax basis.
2 In 2016, CAPEX was €118 million and OPEX was €557 million.

Automotive & Licensing

(€ in millions, unless stated otherwise)   Q4 '16   Q4 '15   y.o.y. change   FY '16   FY '15   y.o.y. change
                         
Automotive revenue   36.7   30.3   21 %   132.6   105.9   25 %
Licensing revenue   35.0   39.3   -11 %   136.3     142.1     -4 %
Total Automotive & Licensing revenue   71.7   69.6   3 %   269.0     248.0     8 %
                         
Automotive & Licensing segment EBITDA 82.1 68.4 20 %
EBITDA margin (%) 31 % 28 %
Automotive & Licensing segment EBIT -25.5 -33.9
EBIT margin (%)               -9 %   -14 %    

Change percentages and totals calculated before rounding.

Automotive & Licensing combined revenue in the quarter was €72 million (Q4 '15: €70 million) and €269 million for the full year 2016 (FY '15: €248 million).

Automotive generated revenue of €37 million in the quarter, representing a 21% increase year on year. On a full year basis, Automotive revenue reached €133 million, 25% higher compared with last year (FY '15: €106 million). This growth reflects increasing revenue from new contracts that started to kick in during 2016 as well as higher revenue on existing contracts.

The deferred revenue position of Automotive increased to €59 million at the end of 2016 from €23 million at the end of 2015. A breakdown of deferred revenue is provided in the Balance sheet section.

Licensing revenue in Q4 '16 was €35 million compared with €39 million in the same quarter last year. On a full year basis, Licensing reported total revenue of €136 million, 4% lower compared with €142 million in 2015. The year on year decrease was driven mainly by the discontinuation of a customer business relationship, which was in turn partially offset by revenue growth from other customers.

In the quarter, FCA Group selected TomTom as ‘Innovation Supplier of the Year 2016’. Lucid Motors selected TomTom as ‘infotainment partner’ for its first vehicle launch. We also entered some smaller contracts with Tier1 and Tier2 suppliers, including Digen, through which TomTom components appeared in Mitsubishi vehicles.

In addition, we demonstrated Autonomous Driving together with Bosch at ITS world congress in Australia, and are working with the majority of OEMs and Tier1s using TomTom’s HD Map product samples, including RoadDNA.

Licensing business announced a partnership with Microsoft to integrate its online APIs into the Azure platform. By providing our maps, traffic, and navigation software on Azure, we will be able to reach a much broader developer community. This will make it easier and be more flexible for developers to build and manage mobile, web and ‘Internet of Things’ applications that are location-aware. We also extended a number of existing partnerships including MapQuest, Pitney Bowes, and SAP. The partnership with MapQuest (a subsidiary of AOL, Inc.) now includes TomTom’s leading traffic solution in addition to our mapping services. We have increased Pitney Bowes’ access to our localisation data and for the first time we are providing geocoding and address validation capabilities across SAP’s product portfolio globally.

Finally, to address the growing opportunities in smart city technology and live up to our commitment to fight against traffic congestion, we have launched TomTom City in 100 cities across six continents. The TomTom City portal is a showcase for the extensive range of traffic information we have available on a city by city basis and provides a platform to connect traffic authorities, businesses and citizens.

Telematics

(€ in millions, unless stated otherwise)   Q4 '16   Q4 '15  

y.o.y.¹
change

  FY '16   FY '15  

y.o.y.¹
change

                         
Hardware and other services revenue²   10.8   11.0   -3 %   36.8   37.2   -1 %
Subscription revenue   30.8   26.0   19 %   118.4     97.8     21 %
Total Telematics revenue   41.6   37.0   12 %   155.1     135.0     15 %
                         
Telematics segment EBITDA 59.1 49.0 21 %
EBITDA margin (%) 38 % 36 %
Telematics segment EBIT 44.5 39.7 12 %
EBIT margin (%)               29 %   29 %    
                         
Monthly subscription ARPU (€) 14.5 15.8 -8 % 14.9 15.9 -6 %
Subscriber installed base (# in thousands)               696     605     15 %

1 Change percentages and totals calculated before rounding.
2 Other services revenue comprises installation services and separately purchased traffic service and/or map content.

Telematics generated revenue of €42 million in Q4 '16, a 12% increase compared with €37 million in Q4 '15. This increase was driven by growth in the WEBFLEET subscriber base, which was partially offset by a decline in hardware revenue. The recurring SaaS revenue amounted to €31 million for the quarter, 19% higher compared with the same quarter last year. Hardware revenue was relatively flat compared with Q4 '15, due to a higher proportion of hardware rental in our new subscriber sales mix. Revenue for 2016 was €155 million, representing a 15% growth year on year (FY '15: €135 million).

At the end of the year, Telematics reported more than 46,000 customers worldwide, with an installed base of more than 696,000 active subscribers. This is a 15% increase from 605,000 at the start of 2016.

Consumer

(€ in millions, unless stated otherwise)   Q4 '16   Q4 '15  

y.o.y.
change

  FY '16   FY '15  

y.o.y.
change

                         
Consumer products   140.6   156.7   -10 %   502.0   551.2   -9 %
Automotive hardware   11.7   19.2   -39 %   61.2     72.4     -15 %
Total Consumer revenue   152.3   175.9   -13 %   563.2     623.6     -10 %
                         
Consumer segment EBITDA 5.9 14.1 -58 %
EBITDA margin (%) 1 % 2 %
Consumer segment EBIT -3.9 2.6
EBIT margin (%)               -1 %   0 %    

Change percentages and totals calculated before rounding.

Total Consumer revenue for the quarter was €152 million, a decline of 13% compared with the same quarter last year (Q4 '15: €176 million). Total Consumer products revenue amounted to €141 million in the quarter, 10% lower than in the same quarter last year (Q4 '15: €157 million). On a full year basis, Consumer products revenue decreased by 9% totalling €502 million (FY '15: €551 million). This decrease was driven by lower PND revenue, which was partially offset by a strong growth in Sports revenue. Sports revenue amounted to €106 million in 2016, an increase of 53% compared with last year (FY '15: €69 million). In 2016, we shipped over one million sports devices (FY '15: 600,000). In the quarter, we launched the Get Going campaign to further strengthen the TomTom Sports brand.

Consumer PND markets were weak during the second half of 2016. The European PND market experienced a faster rate of unit decline compared with the first half of the year. This market in units was down by 19% for the year as a whole. We remained market leader in Europe.

Automotive hardware revenue was €12 million in the quarter (Q4 '15: €19 million) and €61 million in 2016 (FY '15: €72 million). This year on year decrease was mainly driven by a legacy product that went to end of life earlier in 2016.

Data, software & services and Hardware revenue split

(€ in millions)   Q4 '16   Q4 '15  

y.o.y.
change

  FY '16   FY '15  

y.o.y.
change

                         
Hardware revenue   142.7   163.0   -13 %   505.9   557.8   -9 %
Data, software & services revenue   122.9   119.5   3 %   481.4   448.8   7 %
Total revenue   265.6   282.5   -6 %   987.3   1,006.6   -2 %

Change percentages and totals calculated before rounding.

Hardware revenue for the quarter was €143 million compared with €163 million in Q4 '15. Data, software & services revenue in the quarter was €123 million, 3% higher compared with €120 million in Q4 '15, mainly due to growing Automotive and Telematics subscription revenue. As a percentage of revenue, data, software & services revenue increased to 46% in Q4 '16 from 42% in Q4 '15.

On a full year basis, revenue from data, software & services was €481 million (FY '15: €449 million) and accounted for 49% of total revenue (FY '15: 45%).

Geographical revenue split

(€ in millions)   FY '16   FY '15  

y.o.y.
change

             
Europe   773.2   771.5   0 %
North America 167.4 186.1 -10 %
Rest of the world   46.7   49.0   -5 %
Total revenue   987.3   1,006.6   -2 %

Change percentages and totals calculated before rounding.

From a regional perspective, 78% of 2016 revenue was generated in Europe (FY '15: 77%), 17% in North America (FY '15: 18%) and the remaining 5% in the rest of the world (FY '15: 5%).

Gross margin

The gross margin for the quarter was 58%, which is 9 percentage points higher compared with 49% in Q4 '15. The year on year increase was mainly due to a change in our product mix, with a relatively higher portion of recurring high gross margin data, software & services revenue. In addition, the Q4 '15 gross margin was negatively impacted by an impairment charge of €11 million related to certain Automotive customer specific technology being recorded as part of cost of sales.

On a full year basis, we reported a gross margin of 57% in 2016 (FY '15: 52%). At constant currency rates for the US dollar and GB pound, our FY '16 gross margin and operating result would have been 1% higher.

Operating expenses

Total operating expenses for the quarter were €154 million, which is €15 million higher compared with the same quarter last year (Q4 '15: €139 million). The higher operating expenses were mainly driven by higher service platform charges and higher amortisation related to certain technology platforms that went operational in 2016.

On a full year basis, total operating expenses amounted to €557 million compared with €518 million in 2015, an increase of €39 million year on year. This increase is mainly caused by higher depreciation and amortisation costs. In addition, last year’s operating expenses included a one-off gain from a settlement of a litigation case.

FX sensitivity

(€ in millions, unless stated otherwise)   Q4 '16


actual 		  Q4 '16
recalculated at
Q4 '15

FX rates1

  FY '16


actual 		 

FY '16
recalculated at
FY '15

FX rates1

                 
Revenue   265.6   270.9   987.3   998.9
 
Gross result 153.0 158.2 566.2 578.6
Gross margin 58 % 58 % 57 % 58 %
EBIT -0.5 3.0 8.9 17.4
EBIT margin 0 % 1 % 1 % 2 %
FX RATES (IN €) Q4 '16 Q4 '15 FY '16 FY '15
US dollar 1.09 1.09 1.11 1.11
GB pound   0.87     0.72     0.81     0.73  

¹The Q4 '16 / FY '16 income and expense in US dollar and GB pound have been converted to euro using Q4 '15 / FY '15 average rates. All other foreign currencies have not been converted.

Depreciation and amortisation

(€ in millions)   Q4 '16   Q4 '15  

y.o.y.
change

  FY '16   FY '15  

y.o.y.
change

                         
Cost of sales   2.6   14.6   -82 %   8.8   21.6   -59 %
Research and development 2.5 2.4 3 % 11.6 9.0 28 %
Amortisation of technology & databases   27.2   19.9   36 %   91.5   76.7   19 %
Marketing   0.1   0.0       0.3   0.0    
Selling, general and administrative   6.7   4.6   46 %   19.8   15.8   25 %
Total   39.1   41.5   -6 %   132.0   123.1   7 %
Of which acquisition-related amortisation   14.2   13.1   8 %   55.3   52.1   6 %

Change percentages and totals calculated before rounding.

Total depreciation and amortisation costs amounted to €39 million in the quarter, 6% lower compared with last year (Q4 '15: €42 million). Acquisition-related amortisation was €14 million in Q4 '16 (Q4 '15: €13 million).

On a full year basis, acquisition-related amortisation amounted to €55 million in 2016, 6% higher compared with last year (FY '15: €52 million) due to a Telematics acquisition at the end of 2015.

Financial income and expenses

The net interest charge for the quarter was €0.3 million versus a net interest charge of €0.2 million in Q4 '15. The other financial result for the quarter was a loss of €2.0 million (Q4 '15: loss of €2.4 million), which consisted primarily of foreign exchange losses from the revaluation of monetary balance sheet items partially offset by our hedging results.

On a full year basis, the total financial income and expense charge equalled €2.4 million compared with €8.3 million in 2015. The decrease reflects lower foreign exchange loss in 2016 compared with last year.

Income tax

The net income tax for the quarter was a charge of €3.0 million versus a net income tax gain of €23 million in Q4 '15. The income tax for the year was a gain of €4.7 million mainly reflecting a change in the estimated prior years’ taxable income following the finalisation of the tax returns and the remeasurement of deferred tax assets and liabilities to a lower tax rate due to the application of the innovation box facility in the Netherlands.

Net result and adjusted EPS

(€ in millions, unless stated otherwise)   Q4 '16   Q4 '15  

y.o.y.
change

  FY '16   FY '15  

y.o.y.
change

                         
Net result   -5.6   20.9       12.0   18.3   -35 %
Net result attributed to equity holders   -5.5   20.8     12.0   18.1   -34 %
Remeasurement of deferred tax liability 5.3 -7.5 -2.3 -7.5 -70 %
Acquisition-related amortisation 14.2 13.1 8 % 55.3 52.1 6 %
Tax effect of adjustments   -2.7   -3.3   -18 %   -10.9   -13.0   -16 %
Adjusted net result   11.3   23.1       54.1   49.6    
                         
Adjusted EPS, € fully diluted   0.05   0.10       0.23   0.21    

Change percentages and totals calculated before rounding.

The net result for the quarter was a loss of €5.6 million compared with a gain of €21 million in Q4 '15. The net result adjusted for acquisition-related expenses & gains on a post-tax basis was a gain of €11 million compared with €23 million in Q4 '15.

Adjusted EPS for the quarter was €0.05 versus €0.10 in Q4 '15. Adjusted EPS for 2016 was €0.23 (FY '15: €0.21).

Balance sheet

At the end of the quarter, trade receivables plus other receivables totalled €179 million compared with €192 million at the end of Q4 '15. The inventory level at the end of the quarter was €54 million, compared with €49 million at the end of the same quarter last year. Cash and cash equivalents at the end of the quarter were €143 million versus €148 million at the end of Q4 '15.

Current liabilities excluding deferred revenue were €266 million compared with €293 million at the end of Q4 '15. The year on year decrease is mainly due to a decrease in trade payables.

Deferred revenue was €204 million at the end of Q4 '16, compared with €187 million at the end of the same quarter last year. The year on year increase reflects the increased deferred revenue position related to Automotive contracts with upfront payments.

Deferred revenue balance by segment

(€ in millions)   31 December 2016   31 December 2015  

y.o.y.
change

             
Automotive & Licensing   70.0   53.8   16.2
Automotive 58.6 22.6 36.0
Licensing 11.4 31.2 -19.8
Telematics 1.7 2.7 -1.0
Consumer   132.7   130.4   2.3
Total deferred revenue   204.4   186.9   17.5

Change amounts are calculated before rounding

At 31 December 2016, we reported a net cash position of €133 million (Q4 '15: net cash of €98 million). Net cash is the sum of the cash and cash equivalents at the end of the period (€143 million) minus the borrowings (€10 million).

Cash flow

The cash flow from operating activities for the quarter was €76 million compared with €58 million in Q4 '15. The year on year increase was mainly driven by lower working capital utilisation in Q4 '16. On a full year basis, cash flow from operating activities was €144 million compared with €119 million in 2015.

The cash flow used in investing activities during the quarter decreased by €29 million year on year to €26 million. On a full year basis the cash flow used in investing activities was €120 million, a decrease of €34 million year on year. The year on year decrease in investments relates mainly to acquisitions. In 2015, we made two acquisitions for an aggregate consideration of €42 million. The majority of the investments in 2016 related to our transactional mapmaking platform, map database and Automotive customer specific projects.

The cash flow used in financing activities mainly reflects a lower utilisation from our credit facility. In the quarter, 276 thousand options (Q4 '15: 928 thousand options) related to our long-term employee incentive programmes, were exercised resulting in a €1.1 million cash inflow (Q4 '15: €4.5 million). On a full year basis, 2.4 million options (FY '15: 6.9 million options) were exercised resulting in a €10 million cash inflow for 2016 (FY '15: €34 million).

- END -

Consolidated condensed statement of income

(€ in thousands)  

Q4 '16
Unaudited

 

Q4 '15

Unaudited

 

FY '16
Audited

 

FY '15
Audited

                 
Revenue   265,618   282,488   987,329   1,006,607
Cost of sales   112,594   143,523   421,101   488,080
Gross result   153,024   138,965   566,228   518,527
                 
Research and development expenses 49,585 46,807 190,473 185,443
Amortisation of technology and databases 27,222 19,939 91,526 76,694
Marketing expenses 24,847 25,777 80,609 83,438
Selling, general and administrative expenses   51,868   46,239   194,726   172,352
Total operating expenses   153,522   138,762   557,334   517,927
                 
Operating result   -498   203   8,894   600
                 
Interest result -285 -170 -1,371 -925
Other financial result -2,001 -2,437 -1,010 -7,343
Result of associates   178   164   736   167
Result before tax   -2,606   -2,240   7,249   -7,501
                 
Income tax gain / (expense)   -2,954   23,179   4,709   25,794
Net result   -5,560   20,939   11,958   18,293
 
Net result attributable to:                
Equity holders of the parent -5,466 20,824 11,987 18,122
Non-controlling interests -94 115 -29 171
Net result   -5,560   20,939   11,958   18,293
                 
Basic number of shares (in thousands) 232,725 230,131 231,743 227,771
Diluted number of shares (in thousands)   235,430   237,656   234,970   232,378
                 
EPS, € basic -0.02 0.09 0.05 0.08
EPS, € diluted   -0.02   0.09   0.05   0.08

Consolidated condensed balance sheet

(€ in thousands)   31 December 2016

Audited

  31 December 2015

Audited

         
Goodwill   400,318   403,437
Other intangible assets 795,771 810,908
Property, plant and equipment 40,398 38,869
Deferred tax assets 12,046 7,512
Investments in associates   3,941   3,546
Total non-current assets   1,252,474   1,264,272
         
Inventories 54,078 48,657
Trade receivables 132,424 138,593
Other receivables and prepayments 46,115 53,533
Other financial assets 1,210 967
Cash and cash equivalents   142,527   147,565
Total current assets   376,354   389,315
         
Total assets   1,628,828   1,653,587
         
Share capital 46,577 46,099
Share premium 1,051,890 1,035,451
Other reserves 234,502 228,216
Accumulated deficit   -338,138   -340,956
Equity attributable to equity holders of the parent   994,831   968,810
Non-controlling interests   1,906   1,723
Total equity   996,737   970,533
         
Borrowings 9,586 44,254
Deferred tax liability 97,282 123,825
Provisions 54,406 35,065
Deferred revenue   107,151   83,726
Total non-current liabilities   268,425   286,870
         
Borrowings 0 4,287
Trade payables 76,630 94,951
Income taxes 1,289 4,382
Other taxes and social security 9,383 13,056
Provisions 36,410 32,573
Deferred revenue 97,256 103,147
Accruals and other liabilities   142,698   143,788
Total current liabilities   363,666   396,184
         
Total equity and liabilities   1,628,828   1,653,587

Consolidated condensed statements of cash flows

(€ in thousands)  

Q4 '16
Unaudited

 

 

Q4 '15
Unaudited

 

 

FY '16
Audited

 

 

FY '15
Audited

 

                 
Operating result   -498   203   8,894   600
Financial gains / (losses) 2,794 278 1,235 -2,364
Depreciation and amortisation 39,052 41,536 132,003 123,096
Change in provisions 10,483 -9,311 9,649 -15,386
Equity-settled stock compensation expenses 525 1,046 3,275 3,788
Changes in working capital:
Change in inventories 6,830 8,968 -5,817 2,468
Change in receivables and prepayments 42,063 17,257 14,183 -18,038

Change in liabilities (excluding provisions)3 Includes the movement of
non-current deferred revenue presented under Non-Current liabilities.

  -22,325   -1,645   -5,301   29,115
Cash generated from operations   78,924   58,332   158,121   123,279
                 
Interest received 57 112 185 504
Interest paid -261 -57 -1,227 -958
Corporate income taxes paid   -3,046   -830   -12,762   -4,050
Cash flows from operating activities   75,674   57,557   144,317   118,775
                 
Investments in intangible assets -21,973 -22,889 -96,444 -87,169
Investments in property, plant and equipment -4,439 -4,018 -21,141 -21,577
Acquisitions of subsidiaries and other businesses 0 -28,175 -2,331 -45,636
Dividends received   60   62   190   167
Cash flows from investing activities   -26,352   -55,020   -119,726   -154,215
 
Change in utilisation of credit facility -38,000 15,000 -35,000 -5,000
Repayment of borrowings 0 0 -4,287 0
Change in non-controlling interest 0 0 -98 -126
Dividends paid 0 0 -138 0
Proceeds on issue of ordinary shares   1,116   4,484   10,039   34,397
Cash flows from financing activities   -36,884   19,484   -29,484   29,271

Net increase / (decrease) in cash and cash equivalents

12,438 22,021 -4,893 -6,169
Cash and cash equivalents at beginning of period 129,262 124,427 147,565 152,949
Exchange rate changes on cash balances held in foreign currencies 827 1,117 -145 785
Cash and cash equivalents at end of period   142,527   147,565   142,527   147,565

3 Includes the movement of non-current deferred revenue presented under Non-Current liabilities.

Accounting policies - basis of accounting

The condensed consolidated financial information for the three-month and the twelve-month period ended 31 December 2016 with related comparative information has been prepared using accounting policies which are based on International Financial Reporting Standards (IFRS). Accounting policies and methods of computation followed in the condensed consolidated financial information, for the period ended 31 December 2016, are the same as those followed in the Financial Statements for the year ended 31 December 2016. Further disclosures as required under IFRS for a complete set of consolidated financial statements are not included in the condensed consolidated financial information. The consolidated and company financial statements of TomTom NV for the year ended 31 December 2016 have been prepared and audited but are not yet published. The quarterly condensed consolidated information in this press release is unaudited.

Non-GAAP measures

The financial information in this report includes measures, which are not defined by generally accepted accounting principles (GAAP) such as IFRS. We believe this information, along with comparable GAAP measurements, gives insight to investors because it provides a basis for evaluating our operational performance. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP. Wherever appropriate and practical, we provide reconciliations to relevant GAAP measures.

Gross margin is calculated as gross result divided by revenue

EBIT is equal to our operating result

EBIT margin is calculated as operating result divided by revenue

EBITDA is equal to our operating result plus depreciation and amortisation charges

EBITDA margin is calculated as operating result plus depreciation and amortisation charges divided by revenue

Adjusted net result is calculated as net result attributed to equity holders adjusted for acquisition-related expenses and gains on a post-tax basis (a reconciliation to net result is provided on page 7)

Adjusted EPS is calculated as adjusted net result divided by the weighted average number of diluted shares over the period

Net cash is defined as our cash and cash equivalents minus the nominal value of our outstanding borrowings

For more information

TomTom Investor Relations
ir@tomtom.com
+31 20 757 5194

Audio webcast fourth quarter and full year 2016 results

The information for our fourth quarter and full year 2016 results audio webcast is as follows:

Date and time: 8 February 2017 at 14.00 CET

corporate.tomtom.com/presentations.cfm

TomTom is listed at NYSE Euronext Amsterdam in the Netherlands

ISIN: NL0000387058 / Symbol: TOM2

About TomTom

TomTom (TOM2) empowers movement. Every day millions of people around the world depend on TomTom to make smarter decisions. We design and develop innovative products that make it easy for people to keep moving towards their goals. Our map-based components include map content, online map-based services, real-time traffic, and navigation software. Our consumer products include PNDs, navigation apps, sports watches and action camera. Our main business products are custom in-dash navigation systems and a fleet management system, which is offered to fleet owners as an online service with integrated in-vehicle cellular devices. Our business consists of four customer facing business units: Automotive, Licensing, Telematics and Consumer. Founded in 1991 and headquartered in Amsterdam, we have more than 4,700 employees worldwide. For further information, please visit www.tomtom.com.

Forward-looking statements/Important notice

This document contains certain forward-looking statements with respect to the financial position and results of TomTom’s activities. We have based these forward-looking statements on our current expectations and projections about future events, including numerous assumptions regarding our present and future business strategies, operations and the environment in which we will operate in the future. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, and you should not place undue reliance on them. Many of these risks and uncertainties relate to factors that are beyond TomTom’s ability to control or estimate precisely, such as levels of customer spending in major economies, changes in consumer preferences, the performance of the financial markets, the levels of marketing and promotional expenditures by TomTom and its competitors, costs of raw materials, employee costs, exchange-rate and interest-rate fluctuations, changes in tax rates, changes in law, acquisitions or disposals, the rate of technological changes, political developments in countries where the company operates and the risk of a downturn in the market. Statements regarding market share, including the company's competitive position, contained in this document are based on outside sources such as specialised research institutes, industry and dealer panels in combination with management estimates.

The forward-looking statements contained herein speak only as of the date they are made. We do not assume any obligation to update any public information or forward-looking statement in this document to reflect events or circumstances after the date of this document, except as may be required by applicable laws.

This document contains inside information as meant in clause 7 of the Market Abuse Regulation.


Contact:

TomTom Investor Relations
Email Contact
+31 20 757 5194