TomTom says deliveries as expected so far in Q4

BARCELONA, Nov 19 (Reuters) - Deliveries of navigation devices to retailers have been as expected so far in the fourth quarter but it is too early to draw conclusions, the chief executive of manufacturer TomTom (TOM2.AS) said.

"In terms of sell-in, what we expected retailers to do, it's so far so good. October did what we expected," TomTom CEO Harold Goddijn told the Morgan Stanley Annual Technology, Media and Telecoms Conference in Barcelona.

Retailers were being cautious, managing their capital tightly and trying to shift risk to suppliers, but were still stocking the satellite navigation (satnav) devices as they realised they would continue to sell despite an economic slowdown, Goddijn said.

Sales of navigation devices are expected to represent 6 to 8 percent of total consumer electronics sales in the fourth quarter, he said.

Portable navigation devices have been one of the fastest-growing consumer electronics categories in recent years, but have not been tested yet in an economic downturn.

Shares in TomTom, Europe's largest maker of the devices, have slumped from 66.5 euros a year ago to just 4.29 euros on Wednesday, and its market capitalisation is now below 600 million euros ($760 million), substantially less than the 2.9 billion euros it paid for digital map maker Tele Atlas five months ago.

Goddijn said the company continued to believe that satnavs were essential for drivers, and that penetration rates in Europe and North America would roughly double to around 40 percent of cars by 2011. The company is "well on track" to again deliver a 40 percent gross margin and a 20 percent operating profit margin, Goddijn said.

TomTom's main competitor is U.S. market leader Garmin (GRMN.O). (Reporting by Niclas Mika, editing by Will Waterman)