Oct. 24 (Bloomberg) -- TomTom NV, Europe’s biggest maker of portable navigation devices, said it started a restructuring plan, including job cuts, that should deliver 50 million euros ($70 million) of savings in 2012.
The plan “will focus our organization on the areas where we see the greatest potential for growth,” Chief Executive Officer Harold Goddijn said in a statement today, citing the automotive and content and services businesses as examples. The job cuts will only be partially achieved through attrition.
Third-quarter net income rose 50 percent to 29 million euros compared with the average forecast of seven analysts surveyed by Bloomberg of 16 million euros. Sales declined 10 percent to 336 million euros.
The Amsterdam-based company expects full-year 2011 revenue and earnings per share toward the upper end of a guidance range that calls for sales of 1.23 billion euros to 1.28 billion euros and earnings per share of 25 cents to 30 cents.
TomTom shares have declined 61 percent this year reducing the company’s market value to 677 million euros. The company slashed its sales forecast twice after U.S. demand for portable devices fell faster than anticipated and consumers opted for cheaper navigation systems.
Goddijn has been trying to increase sales of built-in navigation systems for cars as well as electronic maps and other software. The Amsterdam-based company earlier this month announced deals to install its products in Ford Motor Co. cars and Iveco SpA trucks.
Automotive sales rose 43 percent in the third quarter to 59 million euros. Consumer sales declined 23 percent to 225 million euros.
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