Oberthur H1 profits divided by 12
Shipments are increasing steadily: Oberthur sold more than 114 million microprocessor cards in H1/2006 (a 30% increase on H1/2005 figure), out of which 60.7 million units were SIM cards. Sales levels are affected by the average selling price (ASP) drop, estimated by Oberthur at 36,4%. Markets in Asia are favorable, with Oberthur strong presence on Indian market. Oberthur also did very well on the US market where it is still a newcomer.
Even if mobile communication is playing an increasing role, payment services still account for almost 50% of Oberthur Card systems sales. The first half of 2006 shows a 25% volume decrease to 31 million units. This is due to the DDA (Dynamic Data Authentication) migration planned only for end of H2 in France, and exceptionally high volumes in H1/2005 in the UK. Price erosion is limited in this segment, thanks to long-term contracts.
Identity & Security shipments for the first half of 2006 were up 88%, a growth fuelled essentially by Pay-TV card shipments in France and China.
In spite of these poor results, Oberthur management remains confident for H2/2006, quoting DDA cards in France and EMV replacement in the UK as strong growth factors for banking, and seasonality and 3G deployment fuelling telecom segment results. On the other hand, Oberthur management has implemented a strict cost control policy that already led to restructuring production facilities in the UK and in the USA.