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BRUSSELS, April 29 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
"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