Smart card firm Gemalto says on track for double-digit growth
(Reuters) - French smart card maker Gemalto GTO.PA reported higher first-quarter sales and said it was on track to reach its goal of double-digit growth over the year.
The maker of smart chips for mobile phones and bank payment cards said on Thursday sales rose 9 percent on constant exchange rates to 518 million euros in the first three months of the year.
Sales at its mobile unit, which is its most profitable business and accounts for close to half its sales, grew 4 percent thanks to strong orders for its more sophisticated chip cards from telecom operators moving to 4G mobile broadband networks.
"Sales of high-end products to mobile network operators continue to expand and are expected to accelerate over the year as additional LTE and mobile payment services are launched," Chief Executive Olivier Piou said in a statement.
At its smaller security unit, which makes embedded software for electronic documents such as passports and driving licences, sales grew 21 percent to 91 million euros helped by deployment of electronic identity programs from governments.
Sales grew 13 percent to 143 million in its secure transactions business, helped by the worldwide move to EMV-standard chip technology for credit and debit payment cards as well as NFC technologies, which allow smartphone users to make contactless payments.
Gemalto said it expected double-digit growth in profit from operations and revenue at constant exchange rates.
The company, which will present its next strategic plan during the second half of 2013, said the U.S. and Asian markets would drive sales growth this year.
The company was hit by a 9.8 million-euro operating loss in its patents unit last year due to costs associated with a continuing legal battle in the United States against Google (GOOG.O) over the technology giant's Android mobile software.
"The activity in patents continues to be limited due to ongoing litigation," Gemalto said.
Shares of the Paris-listed company closed almost flat at 63.47 euros on Wednesday.
(Reporting by Alice Cannet in Paris and Neha Alawadhi in Bangalore; Editing by Phil Berlowitz and Stephen Coates)