Thomson: First Half 2008 Results

Thursday, July 24th, 2008
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PARIS — The Board of Directors of Thomson (Euronext Paris: 18453, NYSE:TMS), chaired by François de Carbonnel, met on 23 July 2008 to approve the Group’s 2Q08 revenues and 1H08 results published today.

Access Products (Second Quarter)

Revenue performance in Access Products for 2Q08 was better year-on-year than in 1Q08, although revenues declined in both quarters. Increased volumes were offset by price declines and an adverse mix. A major contract with Comcast was announced recently which strengthens Thomson’s presence in the large US cable market going forward. Thomson also introduced its second generation broadband access gateways at telecom operators such as BT. Amongst key indicators, in 2Q08 Thomson shipped 2.8 million satellite set-top boxes (2Q07, 2.5 million), 1.5 million cable set-top boxes and modems/eMTAs (2Q07, 1.2 million), and 2.9 million access products for telecom operators (2Q07, 2.6 million) – making a total of 7.3 million in the quarter (2Q07, 6.4 million).

This week’s announcement of Thomson’s selection for Telenor’s IPTV rollout is evidence of the opportunities for our end-to-end offering including our middleware, VOD servers and set-top boxes.

Access Products (First Half)

Revenues declined in 1H08 with cable, satellite and telecom customers. The business sold 5.0 million satellite set-top boxes (1H07, 4.7 million), 2.5 million cable set-top boxes and cable modems (1H07, 2.5 million) and 5.1 million access products for telecom operators (1H07, 5.3 million), making a total of 12.7 million access products, a slight increase on the 1H07 total of 12.4 million units. Price and mix were less favourable in 1H08 compared to 1H07.

Units in all areas increased in 2Q08 year-on-year after the very slow start to the year in 1Q08. Macro-economic uncertainty remains but some second generation products were introduced in 1H08 which will be rolled out at major customers such as BT in 2H08. The recently-announced agreement with Comcast strengthens the business’s position in the large US cable market.

The telephony & home networking business was adversely affected by weak retail conditions in the US.

In million units              2Q08   2Q07   1H08   1H07
                              ----   ----   ----   ----
Satellite set-top box          2.8    2.5    5.0    4.7
      Change (%)               13%            8%
Cable device shipments         1.5    1.2    2.5    2.5
      Change (%)               24%            1%
Telecom device shipments       2.9    2.6    5.1    5.3
      Change (%)               11%          (2%)
                             -----   ----   ----   ----
Total Access Products          7.3    6.4   12.7   12.4
      Change (%)             14.2%            2%

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