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Gemplus Announces Preliminary First Quarter Results
Luxembourg, April 4, 2001 - Gemplus International S.A. (Euronext: Sicovam 5768 and NASDAQ:GEMP) today warned that first quarter results are expected to fall short of the company's previous guidance. Based upon preliminary analysis of its results for the quarter ending March 31, 2001, the company anticipates revenue for the first quarter to be approximately € 290 million. This represents 25% growth from first quarter levels in 2000, instead of the 31-32% growth projected earlier. The company now expects operating profit to be slightly below breakeven for the first quarter of 2001.
"Despite continued strong performance in Asia," said Antonio Perez, president and chief executive officer, "we are seeing softer SIM card demand in other regions of the world, particularly Europe and North America. The economic slowdown in the wireless industry is clearly affecting demand as our customers assess their businesses. However, 25% revenue growth in the current environment, while short of our guidance, is solid. This performance follows our strongest year ever."
The company indicated that as a result of the volume shortfall it expects an unfavorable shift in product mix and unfavorable manufacturing variances in its European based factories. Historically, operating profit in the first quarter has been the weakest of the year.
"The management team is currently finalizing work on a series of proposed initiatives intended to reduce manufacturing variances, which we plan to announce very shortly," added Mr. Perez.
As to the second quarter and full year guidance in the context of these developments, the company announced that no adjustments would be made to its original guidance until it has completed its analysis of the first quarter's results. The company will communicate its revised guidance during its full first quarter results conference call on May 2, 2001.
A conference call will be held on Thursday, April 5, 2001, starting at 2:00 p.m. (CET). The call in numbers are:
Europe: 44 (0) 20 8240 8243
North America: 1 800 553 2165
A replay of the conference call will be available two hours after the call until April 12, 2001. The call in numbers are:
Europe: 1 303 804-1855
North America: 1 800 625 5288
Some of the statements contained in this release or our conference call of April 5, 2001 constitute forward-looking statements within the meaning of Section 27a of the Securities Act of 1933 and Section 21e of the Securities Exchange Act of 1934. The statements relate to the future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to materially differ from any future results, levels of activities, performance, or achievements expressed or implied by such forward-looking statements. Actual events or results may differ materially. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Factors that could cause actual results to differ materially from those estimated by the forward-looking statements contained in this release or our conference call include, but are not limited to: trends in wireless communication and financial services markets and trends in the growth of mobile commerce, mobile banking and internet business; our ability to develop and market new chip card technologies to meet market demands and the effects of the adoption of competing technologies in our target markets, particularly in the telecommunications industry and expected intense competition generally in our main markets; profitability of our market expansion strategy; challenges to or loss of our intellectual property rights regarding chip card technologies; our ability to establish and maintain strategic relationships in our major businesses (i.e. with wireless network operators, financial service providers, internet business infrastructure providers and security technology developers); our ability to develop and take advantage of new software and services; the effect of future acquisitions and investments on our share price; the effect of industry wide chip shortages; defects in our products or errors in our services and our ability to attract and maintain qualified executives and personnel, particularly in our research and development division. You are cautioned not to place undue reliance on the forward-looking statements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such forward-looking statements. The forward-looking statements contained in this release speak only as of this release. We are under no duty to update any of the forward-looking statements after this date to conform such statements to actual results or to reflect the occurrence of anticipated results.
About Gemplus
GEMPLUS: the world's leading smart card solutions provider
Since its creation in 1988, Gemplus International S.A. (Euronext: Sicovam 5768 and NASDAQ:GEMP) has driven the global marketing and deployment of smart card-based applications for telecommunications, financial services and e-business security.
Gemplus is instrumental throughout the value chain - chip design, card management systems, software development, and consulting - delivering integrated custom-made solutions for the security, personalization and privacy management needs of clients and partners worldwide.
Gemplus technology has played a defining role in the development of wireless telephony since the introduction of SIM cards into the GSM standard in 1990. For more than a decade, Gemplus has pioneered applications that enable network operators around the world to answer the changing needs of their customers. Gemplus was first to market with a 3G card and supplies a product range compliant with new and emerging transmission standards - 2.5G, 3G.
In 2000, revenue was 1.205 BE, up 57% from the previous year's 767ME. Net income was 99 ME. Gemplus employs more than 7800 people in 37 countries worldwide. Since 11 December 2000, Gemplus shares have been trading on Euronext Paris S.A. First Market and on Nasdaq in the form of ADSs.
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Contacts
Gemplus Corporate, Severine Percetti
tel: 33 (0)4 42 36 67 67
email: severine.percetti@gemplus.com
French Retail Investors - GAVIN ANDERSON & CO
Rozenne Pivet
Tel : 33 (0)1 53 83 31 75
Claire-Valérie
Tel : 33 (0)1 53 83 31 76
Gemplus Investor Relation, Michael Look
tel: 1 650 654 2940
email: michael.look@gemplus.com
©2001 Gemplus All rights reserved. Gemplus,
the Gemplus logo and GemSense are trademarks and service marks of Gemplus
S.A. and are registered in certain countries. All other trademarks and
service marks, whether registered or not in specific countries, are the
property of their respective owners.
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