NAVTEQ Reports Record Revenue for the Third Quarter of 2005
CHICAGO, Oct. 19, 2005 -- NAVTEQ Corporation , a leading global provider of digital map data for vehicle navigation and location-based solutions, today reported record revenue for the quarter ended September 25, 2005.
Revenue in the quarter rose 26% over the third quarter of 2004 to $123.0 million. Operating income grew 38% over the year-ago period to $30.4 million. Net income in the quarter rose to $101.1 million, compared to $13.6 million in the prior year's third quarter. Diluted earnings per share for the quarter grew to $1.07, compared to $0.15 in the prior year's third quarter.
Net income and diluted earnings per share for the third quarter increased significantly when compared to the same quarter in 2004 due in part to the recording of a net income tax benefit of $80.6 million, or $0.85 per diluted share, primarily related to the reversal of the valuation allowance on deferred tax assets associated with net operating loss and deferred interest carryforwards.
For the first nine months of 2005, revenue was $350.5 million, which represented growth of 28% over the same period in 2004. Year-to-date operating income grew 47% to $92.7 million. Net income for the first nine months of 2005 rose to $143.2 million, compared to $38.6 million for the same period in 2004. Year-to-date diluted earnings per share increased to $1.52, compared to $0.42 for the first nine months of 2004. The increases in year- to-date net income and diluted earnings per share were also affected by the reversal of the valuation allowance in the third quarter.
"We are pleased with the progress we achieved in the third quarter and we are encouraged by the trends we see in the marketplace this year," said Judson Green, President and Chief Executive Officer of NAVTEQ. "Consumer interest in GPS technology is surging in 2005 and we are proud to be enabling so many of the products and services being created by our customers."
Revenue from NAVTEQ's European operations totaled $77.2 million in the quarter, up 13% from $68.3 million in the third quarter of 2004. North American revenue was $42.7 million in the quarter, a 45% increase over the $29.5 million posted in the third quarter of 2004.
Cash and marketable securities totaled $159.0 million at September 25, 2005. Net cash provided by operating activities for the first nine months of 2005 was $77.5 million.
Earnings Call Information
The information for the company's earnings release conference call is as follows:
When: Wednesday, October 19, 2005 at 5:00 PM ET Where: http://investor.navteq.com/ How: Log on to the web at the URL above or call to listen in at 800- 329-9097 (North America) or 617-614-4929 (international), passcode 41754549 Contact: investorrelations@navteq.com
The company will provide a telephone replay of the conference call at 888- 286-8010 (North America) or 617-801-6888 (international), passcode 65716000. The telephone replay will be accessible from 7:00 PM ET Wednesday, October 19, 2005 through 11:59 PM ET on Wednesday, October 26, 2005. An on-demand replay of the conference call will also be available online at http://investor.navteq.com/ until November 19, 2006.
This document may include certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts and statements identified by words such as "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates" or words of similar meaning. These statements are based on our current beliefs or expectations and are inherently subject to various risks and uncertainties, including those set forth under the caption "Risk Factors" in the Company's Quarterly Report on Form 10-Q for the quarter ended June 26, 2005, as filed with the Securities and Exchange Commission. Actual results may differ materially from these expectations due to changes in global political, economic, business, competitive, market and regulatory factors. NAVTEQ does not undertake any obligation to update any forward-looking statements contained in this document.
About NAVTEQ
NAVTEQ is a leading provider of comprehensive digital map information for automotive navigation systems, mobile navigation devices, Internet-based mapping applications, and government and business solutions. NAVTEQ creates the digital maps and map content that power navigation and location-based services solutions around the world. The Chicago-based company was founded in 1985 and has approximately 1,800 employees located in 127 offices in 21 countries.
NAVTEQ is a trademark in the U.S. and other countries.
NAVTEQ CORPORATION
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
Quarter Ended Nine Months Ended
Sept. 26, Sept. 25, Sept. 26, Sept. 25,
2004 2005 2004 2005
Net revenue $97,793 123,005 273,858 350,534
Operating costs and expenses:
Database creation and distribution
costs 48,166 57,377 133,140 159,380
Selling, general, and administrative
expenses 27,528 35,205 77,840 98,458
Total operating costs and
expenses 75,694 92,582 210,980 257,838
Operating income 22,099 30,423 62,878 92,696
Other income (expense) (169) 1,202 (558) 2,640
Income before income taxes 21,930 31,625 62,320 95,336
Income tax expense (benefit) 8,334 (69,490) 23,682 (47,828)
Net income $13,596 101,115 38,638 143,164
Earnings per share of common stock -
Basic $0.16 1.11 0.45 1.60
Diluted $0.15 1.07 0.42 1.52
Weighted average shares of common
stock outstanding -
Basic 87,669 90,701 86,114 89,700
Diluted 92,230 94,521 91,757 93,959
NAVTEQ CORPORATION
Condensed Consolidated Balance Sheets
(In thousands)
Dec. 31, Sept. 25,
2004 2005
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $30,101 39,956
Short-term marketable securities 45,650 60,935
Accounts receivable, net 56,582 86,325
Deferred income taxes 50,696 55,244
Prepaid expenses and other current assets 8,348 15,196
Total current assets 191,377 257,656
Property and equipment, net 18,220 17,925
Capitalized software development costs, net 26,243 25,700
Long-term deferred income taxes, net 92,069 167,949
Long-term marketable securities 27,280 58,119
Acquired intangible assets, net - 17,298
Goodwill - 12,440
Deposits and other assets 9,519 13,040
Total assets $364,708 570,127
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $13,962 13,396
Accrued payroll and related liabilities 28,054 27,985
Other accrued expenses 20,609 26,518
Deferred revenue 31,165 39,800
Total current liabilities 93,790 107,699
Fair value of foreign currency derivative 21,616 7,047
Long-term deferred revenue 13,342 3,785
Other long-term liabilities 3,142 4,199
Total liabilities 131,890 122,730
Stockholders' equity 232,818 447,397
Total liabilities and
stockholders' equity $364,708 570,127
NAVTEQ CORPORATION
Condensed Consolidated Statements of Cash Flows
(Unaudited, in thousands)
Nine Months Ended
Sept. 26, Sept. 25,
2004 2005
Cash flows from operating activities:
Net income $38,638 143,164
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 11,098 15,769
Deferred income taxes 19,557 (88,768)
Stock compensation expense 4,521 6,887
Tax benefit on non-qualified
stock options 569 37,611
Noncash other 1,080 3,437
Changes in operating assets and
liabilities, net of effects of
acquisitions (3,857) (40,620)
Net cash provided by
operating activities 71,606 77,480
Cash flows from investing activities:
Acquisition of property and equipment (9,268) (5,086)
Capitalized software development costs (9,101) (8,948)
Net purchases of marketable securities (46,973) (47,120)
Payments for acquisitions, net of
cash acquired - (8,234)
Purchase of investments - (1,201)
Cash on deposit with affiliate, net 65,143 -
Net cash used in investing
activities (199) (70,589)
Cash flows from financing activities:
Issuance of common stock and other
equity transactions 806 5,147
Dividends paid (47,159) -
Net cash provided by (used
in) financing activities (46,353) 5,147
Effect of exchange rate changes on cash (2) (2,183)
Net increase in cash and
cash equivalents 25,052 9,855
Cash and cash equivalents at beginning
of period 1,982 30,101
Cash and cash equivalents at end of period $27,034 39,956