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Pierre Barberis leaves from Oberthur

Week 48, 2006

We may find the origin of this event in the difficulties the company has been facing in 2006. Oberthur was badly hit by the ASP (Average Sales Price) fall, especially in the SIM card market, and set up a policy of selectivity in addressing market demands which led to keeping some profitability level, but on a shrinking market share. Sales in the banking segment were also affected by delays in the takeoff of EMV migration. All the volume growth achieved by Oberthur (40% in microprocessor cards) has been offset by the price erosion. Globally, the company has had a very limited growth: its sales grew by a mere 0.5% in the first nine months of 2006. Under Pierre Barberis management in 2006, Oberthur implemented a restructuring plan, which is expected to deliver savings of up to EUR 20 million in a full year.

In his four years in charge, Pierre Barberis was praised for his energetic management style, and for the achievement of the turnaround of the company in 2002 – 2003, when he implemented a drastic restructuring plan. After his resignation, the company says he will relocate to South East Asia, for personal reasons. According to Oberthur Card Systems, the replacement for Pierre Barberis in his CEO role has been found and will be announced shortly. Alas for the company, this departure is combined with the recent resignations of Oberthur CFO Cyril Mahler and CTO Eric Alzai.

The difficulties Oberthur Card Systems is facing are unfortunately the ones of the whole industry. Sagem Orga is still struggling for its survival in an uncertain corporate environment at Sagem and Safran levels. Gemalto has already announced two quarters of year on year revenue decrease. The sources of these industry difficulties can be found in many areas, just to name a few of them: slowdown of the growth in the GSM area, price wars leading to the ASP fall, marketshare growth of new entrants in the industry especially form Asia.

Pierre Barberis may only be a collateral casualty in the global difficulties in the industry.

Thierry Spanjaard
Chief Editor
Smart Insights