Slide 1: Tele Atlas N.V. acquisition and second quarter 2007 results
Tele Atlas N.V. acquisition and second quarter 2007 results 23 July 2007 1
Slide 2: Agenda
Agenda Topic Speaker Tele Atlas N.V. acquisition Harold Goddijn (CEO) Market developments Harold Goddijn (CEO) and Business update Q2 2007 Financials Marina Wyatt (CFO) 2
Slide 3: Better Maps, Better Routes, Every Day
Better Maps, Better Routes, Every Day Intended Cash Offer for Tele Atlas N.V. Shares by TomTom N.V. 3
Slide 4: Disclaimer
Disclaimer This announcement does not constitute an offer to purchase any securities, nor a solicitation of a any offer, proxy, consent or authorization to buy or subscribe for any securities of Tele Atlas or any other securities, nor shall it (or any part of it) form the basis of, or be relied upon
Slide 5: TomTom + Tele Atlas: A Unique Strategic Combination
TomTom + Tele Atlas: A Unique Strategic Combination • Combination creates new paradigm for map creation, enrichment and maintenance – TomTom’s unique Map Share™ technology enables its 10 million+ installed base to contribute to digital map creation and maintenance – TomTom’s large historic speed pro
Slide 6: TomTom + Tele Atlas: A Longstanding Existing Relationship
TomTom + Tele Atlas: A Longstanding Existing Relationship FY 2006A Tele Atlas Sales (€264m) • TomTom is Tele Atlas’ largest TomTom customer 26% • Close cooperation since 1996 Other 74% • Two leading pioneers in the navigation industry Q1 2007A Tele Atlas Sales (€64m) • A shared focus on technology a
Slide 7: Terms of the Intended Offer
Terms of the Intended Offer • €21.25 in cash per ordinary share of Tele Atlas N.V. • Aggregate Consideration of €1.8bn(*) • Fully supported by Tele Atlas’ Supervisory and Management Board • 17.4% of shareholders already committed through irrevocables • Key conditions of the offer – 80% of Tele Atlas
Slide 8: A Highly Attractive Price to All Shareholders
A Highly Attractive Price to All Shareholders Implied Premium (%) • Attractive Implied 34% 32% Premium 32% 30% 28% – +28% over current price 28% 26% – +32% over last 3 month 24% average 22% 20% Current price 3 month average • Irrevocable commitment 2007E EV/EBITDA(*) from IAM and board 30.0x 27.6x 2
Slide 9: Financial Reporting
Financial Reporting • Acquisition financed by cash at TomTom and debt committed by Goldman Sachs • Debt expected to represent below 3x combined LTM(*) EBITDA at outset • Strong Cash Flow generation allows for quick deleveraging • Company to amend reporting of key financials to better reflect the com
Slide 10: Summary
Summary • Intended Cash offer for Tele Atlas of €21.25 per share representing a total consideration of €1.8bn(*) • A 32% premium to last three month average • Timing – Works council advice and regulatory process to commence immediately – Launch of the offer expected in October 2007 – Completion by e
Slide 11: Second quarter 2007 results
Second quarter 2007 results 11
Slide 12: Second Quarter Highlights
Second Quarter Highlights • €380 million revenue and €68 million net profit • 1.8 million PNDs shipped • Gross margin of 45% and operating margin 25% • Net cash generated from operating activities €72 million • New TomTom GO range launched • Map Share™ announced • Joint development with Vodafone UK
Slide 13: Strong fundamental market growth
Strong fundamental market growth European PND market doubled in size to over 3m units • previous GO range virtually sold-out • high consumer demand for ONE XL • market share of around 50% North American PND market tripled in size to well over 1m units • expanding product line-up • improving in-store
Slide 14: New TomTom GO Range
New TomTom GO Range The Ultimate Car Navigator Unique New Features and Map Share™ Technology • Elegant and slim design • Latest version navigation software • TomTom Map Share™ technology • Extra large 4.3 inch touch screen • Industry’s first speech recognition • Extensive range of safety features •
Slide 15: Capitalizing the TomTom Community
Capitalizing the TomTom Community TomTom Map Share™ • Roads change • User can make a correction on the device itself in TomTom friendly fashion • Fix is instantaneous • Users benefit from all corrections made by other TomTom users • Every day • For free 15
Slide 16: Better Traffic Information - UK
Better Traffic Information - UK • Taking the ‘E’ out of ETA • Proprietary country-wide traffic flow detection based on billions of mobile phone events per day Current Coverage • National contract with Vodafone • 65.000 km real-time coverage TomTom’s Coverage • 390.000 km historic traffic patterns UK
Slide 17: Agenda
Agenda Topic Speaker Tele Atlas N.V. acquisition Harold Goddijn (CEO) Market developments Harold Goddijn (CEO) and Business update Q2 2007 Financials Marina Wyatt (CFO) 17
Slide 18: Financial Summary
Financial Summary in € millions Q2 ’07 Q2’06 ∆ Q1’07 Revenue 380 277 37.2% 296 Gross Profit 169 118 43.7% 118 Gross Margin 44.6% 42.5% - 40.0% Operating Profit 93 64 46.5% 57 Operating Profit Margin 24.5% 23.0% - 19.1% Net Profit 68 38 80.6% 44 Net Profit Margin 18.0% 13.7% - 14.8% * Percentages are
Slide 19: Revenue by Product and Geography
Revenue by Product and Geography By Product Group By Geography FY 2006 FY 2006 5% ROW 2% 2% North America 8% Europe 90% 93% Q2 2007 Q2 2007 2% 5% ROW 3% North America 15% Europe 82% 93% PNDs PDA/smartphone solutions Other 19
Slide 20: Second Quarter Revenue Analysis
Second Quarter Revenue Analysis Revenue (in € millions) ASP PNDs (in €) 400 300 380 21 7 200 310 296 100 204 195 300 17 277 12 8 8 0 Q2 '06 Q1 '07 Q2 '07 200 Units PNDs (in '000s) 352 2,000 271 1,500 257 100 1,000 1,807 1,330 500 830 0 0 Q2 '06 Q1 '07 Q2 '07 Q2 '06 Q1 '07 Q2 '07 PNDs PDA/smartphone
Slide 21: Operating Expenses Overview
Operating Expenses Overview in € millions Q2 ‘07 Q1 ‘07 Q2 ‘06 R&D 13.5 10.7 9.2 % of revenue 3.6% 3.6% 3.3% Marketing 33.3 20.8 25.8 % of revenue 8.8% 7.0% 9.3% Other SG&A 21.5 22.6 14.2 % of revenue 5.6% 7.6% 5.1% Operating expenses 68.3 54.1 49.3 % of revenue 18.0% 18.2% 17.8% Accounting charge f
Slide 22: Earnings Overview
Earnings Overview in € millions Q2 ‘07 Q1 ‘07 Q2 ‘06 Operating profit 93.4 56.6 63.7 Net financial income and expenses (0.4) 3.1 (11.9) of which FX losses (5.0) (1.1) (13.4) Taxation (24.6) (16.0) (14.0) effective tax rate 26.5% 26.7% 26.9% Net Profit 68.3 43.7 37.8 Average diluted # of shares outst
Slide 23: Cash Flow Overview
Cash Flow Overview in € millions Q2 ‘07 Q1 ‘07 Q2 ‘06 Operating profit 93.4 56.6 63.7 Depreciation and amortization 5.1 5.3 5.7 Additions to provisions 20.8 2.1 2.5 Changes in working capital (14.8) 31.3 (1.7) Other operating items 0.5 2.4 (1.4) Cash generated from operations 105.0 97.7 68.8 Interes
Slide 24: Balance Sheet
Balance Sheet in € millions Q2 ‘07 Q1 ‘07 Q4 ‘06 Non-Current Assets Intangible Assets 59.8 37.1 39.2 Property, plant & equipment 10.3 8.8 7.9 Deferred Tax Assets 17.9 13.9 12.1 Current Assets Inventories 65.9 85.3 123.0 Receivables, Prepayments & Financial Instruments 283.4 211.6 283.0 Cash and Equi
Slide 25: 2007 FY Financial Outlook
2007 FY Financial Outlook • We expect that the European PND market will grow to between 14 and 15 million units in 2007, while the American PND market is expected to grow to between 6 and 7 million units • We expect that our volumes of PNDs will nearly double to between 8 million and 9 million units
Slide 26: Questions
TomTom yw Questions 26
Slide 27: Annex
Annex For further information please contact TomTom Investor Relations Tel: +31 20 753 5194 ir@tomtom.com http://investors.tomtom.com 27
Slide 28: Financial Summary
Financial Summary H1 H1 in € millions 2007 2006 Change Revenue 676 533 27% Gross Profit 288 207 39% Gross Margin 42.5% 38.8% Operating Profit 150 114 32% Operating Margin 22.2% 21.4% Net Profit 112 69 62% Net Profit Margin 16.6% 13.0% * Percentages are based on non-rounded numbers 28
Slide 29: Operating Expenses Overview
Operating Expenses Overview H1 H1 in € millions 2007 2006 Change R&D 24.2 14.8 63.4% % of revenue 3.6% 2.8% Marketing 54.1 40.7 32.9% % of revenue 8.0% 7.6% Other SG&A 44.1 27.4 60.7% % of revenue 6.5% 5.1% Operating expenses 122.4 82.9 47.5% % of revenue 18.1% 15.6% Accounting charge for share opti
Slide 30: Accounting Charge for Share Based Compensation
Accounting Charge for Share Based Compensation • Under IFRS, share options have to be accounted in the P&L through a specific charge. • TomTom accounts for this charge as follows: – At the date of issuance, options are valued by a Black & Scholes model and the calculations are reviewed by our audito
Slide 31: Outstanding Shares
Outstanding Shares Common shares outstanding end of Q1 2007 112,921,566 Common shares outstanding end of Q2 2007 113,284,572 Average shares outstanding end of Q2 2007 113,017,821 Share options as of end of Q1 2007 10,653,921 Exercised share options in Q2 2007 363,006 Anti-dilutive shares options 1,8
Slide 32: Share Options Vesting Schedule
Share Options Vesting Schedule Number of options in 2007-2010 (in ‘000s) 1 Nov 1 Dec 10 Aug 10 Nov 28 Feb 9 May 8 Aug 9 Nov 8 Mar 2007 2007 2008 2008 2009 2009 2009 2009 2010 1,500 €3.75 182 €3.75 1,110 €26.44 3,308 €28.82 105 €25.50 113 €37.68 188 €28.58 1,705 €33.96 30 €30.91 At June 30 2007 there
Slide 33: End
TomTom yw End 33