UPDATE 1-TomTom ups 2014 outlook after Q1 profit beat, tax gain
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BRUSSELS, April 29 (Reuters) - Dutch navigation equipment maker TomTom on Tuesday increased its outlook for 2014, boosted by stronger-than-expected results in the first quarter and a one-off tax settlement.
All units, except for its licensing unit which sells maps and traffic data to third party developers, showed an improved revenue in the first quarter.
TomTom said it now expected revenues in 2014 to reach at least 900 million euros ($1.25 billion), up from an earlier guidance of around 900 million.
It also upped its outlook for earnings per share to about 0.25 euros compared with an earlier guidance of 0.20 euros, boosted by a one-off tax settlement of 0.04 euros per share.
The group's shares rose as much as 11 percent on Tuesday, reaching an 11-week high.
Once an investor darling, TomTom's share price has fallen some 90 percent since reaching an all-time high of 56.32 euros, as the market for navigation devices for motorists was eroded by tough competition from smartphone applications.
In response to this trend, TomTom has over the past years entered into agreements with car manufacturers such as Fiat and Renault to provide built-in systems and most recently started selling its own fitness watches.
In the first quarter, TomTom posted a 1 percent rise in its consumer unit, which consists of the detachable devices for motorists as well as the sports watches, after an 11 percent fall for the unit in 2013.
The group's U.S. peer Garmin, which will report its first-quarter results on Wednesday, has also ventured into new business fields such as devices for fitness and trekking.
TomTom's net profit in the first quarter was 7.6 million euros, above the 5.5 million expected in a Reuters poll of three analysts. The group posted a 2.2 million euro loss in the same period last year.
In spite of the forecast-beating results, analysts said the first quarter did not necessarily signal a turnaround in the company's fortunes.
"While TomTom is investing significant amounts in its core assets, it remains to be seen whether this will result in a differentiated offering," Kepler analyst Peter Olofsen wrote in a note to clients. ($1 = 0.7223 Euros) (Reporting by Robert-Jan Bartunek; editing by Philip Blenkinsop)