Kudelski Group's 2007 results marked by strong top-line growth and long-term investments

Friday, February 29th, 2008
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CHESEAUX — 2007 Kudelski Group results show a robust top line development with total revenues and other operating income reaching CHF 942.5 million, including organic growth and first-time OpenTV consolidation. This confirms the growth momentum of the last five years with a compounded annual growth rate at 25 percent.

Digital Television

Digital TV net revenues increased by 14.5 percent to CHF 573.4 million. European sales increased by 12.5 percent to CHF 322.0 million, with a well balanced distribution. Digital terrestrial operators as well as Eastern European satellite operators experienced a particularly strong growth, with sales doubling compared to the previous year. In the Americas, revenues were substantially stable at CHF 139.9 million. Strong growth in South America compensated for a volume decline in North America and the USD weakness. In 2007, South American operators generated more than half of the American revenues. Sales in Asia-Pacific and Africa increased by 56.5 percent to CHF 111.5 million, with a material increase of smart card sales in the Indian, South Korean and particularly in the Chinese markets.

Digital TV’s new business areas exceeded by 18 percent the CHF 100 millionrevenue target for the full year. The Kudelski Group’s Conditional Access (CA) Modules are gaining traction beyond the traditional footprint and are starting to secure a significant presence in new promising markets such as Italy. In the advanced smart card business, The Group extended its presence in financial services and in the government segments. Further, it continuously expanded in the PVR/push VOD/EPG space, with, in particular, a strong adoption of the company’s NagraGuide solution.

The MobileTV market saw major evolution in 2007. Nagravision confirmed its leadership position, with a DVB-H market share over 95 percent in number of users, mainly driven by its success with all operators in Italy, H3G, Vodafone and Telecom Italia. New contracts have been recently concluded with Vimpelcom and associated broadcaster partner Dominanta in Russia, Telefonica in Latin America, and T-Mobile in the Czech Republic. This leadership in DVB-H is starting to translate in early successes in related technologies like MediaFLO in the US and the Chinese domestic standard StiMi.

The growth rate of IPTV continues to be significant. This growth will even further consolidate with the advent of Cable IPTV, an area where the increasing number of hybrid deployments use a combination of Nagravision broadband and broadcast technologies for pre-integrated solutions. Nagravision strengthened its position by continuing its relationship with Neuf Cegetel, one of the world five largest IPTV deployments. In digital cable TV, Nagravision confirmed its leadership in Europe, with 72 percent subscribers share, and Latin America with 50 percent of the subscriber share.
The active collaboration between OpenTV and Nagravision has resulted in a growing number of contracts wins for OpenTV, including Numéricâble, Canal Digitaal, Reliance, Portugal Telecom and TV Cabo (ZON Multimédia).

New customer wins

  • In Europe, Portugal Telecom has contracted Nagravision as its system integrator for its new DTH service to be launched in 2008. The deployment is based on an end-to-end Kudelski Group solution leveraging Nagravision CAS, OpenTV middleware with a powerful suite of interactive applications, the Quative back-end for interactive services and Lysis content management solution.
  • TV Cabo has selected OpenTV middleware in combination with Nagravision’s High Definition Guide for the launch of its high definition PVRs.
  • Nagravision will provide end-to-end solutions for Mostelekom (Russia) for cable and IPTV networks, including Quative IPTV solutions as common IPTV and cable back-end solutions and Lysis content management. Additional contracts are currently under negotiation in Eastern Europe.
  • In the Americas, TV Azteca, Mexico’s second largest television broadcaster and one of the countries and regions largest conglomerates has selected the Nagravision CA for its next generation media platform.
  • Two major Cable Multiple System Operators in Taiwan, Taiwan Fixed Networks Media (TFN Media) and Kbro jointly serving over 1.5 million subscribers have simultaneously selected Nagravision as their exclusive conditional access vendor going forward.
  • Etisalat, a large innovative operator in the Middle East incumbent in the UAE with licenses in significant countries such as Saudi Arabia, Egypt, Atlantic Telecom (Africa), Sudatel and Canar Telecom (Sudan), Zanzibar (Tanzania), selected Nagravision for the first ever VOD platform deployed in the Middle East and a hybrid Content Management Platform addressing Etisalat Cable and IP customers for launch in the 2nd half of 2008.

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