Dutch digital mapping group TomTom on Friday confirmed its income and cashflow steering for 2022 and 2023, boosting its shares, after reporting a bigger-than-expected second-quarter loss, citing excessive inflation and strained provide chains.
The affirmation of TomTom’s steering helped to drive the corporate’s shares up greater than 12%, placing them heading in the right direction for his or her strongest day in nearly 4 years. The shares have misplaced a fifth of their worth this 12 months.
ING analyst Marc Hesselink mentioned: “OK outcomes regardless of difficult circumstances” and he additionally highlighted the affirmation of steering as reassuring.
The corporate, whose shoppers vary from Volkswagen and Renault to and Microsoft, has been hit by the worldwide chip scarcity that has disrupted the automotive and electronics industries and compelled automakers to slash manufacturing.
“We’re not positive the chip scarcity will get higher this 12 months, there isn’t a proof to assist that but”, Chief Government Officer Harold Goddijn instructed Reuters, pointing to predictions indicating the scarcity will proceed within the first half of 2023.
TomTom additionally pointed to uncertainties associated to Russia’s invasion of Ukraine and growing inflation.
“These might influence provide chains, value ranges, common macro-economic exercise in addition to the valuation of our property and liabilities on the steadiness sheet,” the corporate mentioned in a press release.
TomTom, which in June initiated restructuring of its maps enterprise, mentioned the plan had impacted its working bills by 31 million euros within the quarter.
Money outflows associated to restructuring are anticipated to be weighted in direction of the second half of the 12 months, with roughly one third of the overall prices anticipated in 2023, it mentioned.
“We anticipate the primary results of the restructuring to come back via in Q3 of this 12 months, and naturally advantages might be seen in This fall 2022, or possibly in Q1 2023”, Goddijn instructed Reuters.
He mentioned round 20 TomTom websites internationally had been affected by the reorganisation, principally in Europe, and that the group was nonetheless in talks with commerce unions.
The Amsterdam-based firm, whose merchandise are utilized by main carmakers and main world tech companies, posted a quarterly working lack of 55.5 million euros ($55.7 million), in opposition to analysts’ common forecast for a lack of 20 million euros.
