TomTom 2015 Annual Report Download

Download and view the complete annual report

Please find the complete 2015 TomTom annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 129

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129

Table of contents

  • Page 1

  • Page 2
    ... differ from such forward-looking statements see also section Business Risks of this Annual Report. THIRD-PARTY MARKET SHARE DATA This document contains certain forward-looking statements with respect to the financial condition, results of operations and business of TomTom and certain of the plans...

  • Page 3
    ... NV MANAGEMENT BOARD REPORT · TomTom Management Board · Consumer Business & Financial review · Automotive Business & Financial review · Licensing Business & Financial review · Telematics Business & Financial review · Group financial review · Human resources · Corporate social responsibility...

  • Page 4
    ... an on-board map continously up-to-date. We continued to increase our market share in traffic, increasing our global coverage and enhancing our traffic services. We now offer real-time and historical traffic information in 50 countries around the world. By knowing the traffic situation across the...

  • Page 5
    ..., and Alfa Romeo. In Licensing, we renewed and extended our global agreement with Apple for maps and related information. We also announced a global, multi-year agreement to provide maps and traffic data for the Uber driver app. Our Telematics business continued to perform strongly. The subscriber...

  • Page 6
    MESSAGE FROM THE CEO OVERVIEW TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 5

  • Page 7
    ... cameras, as well as state-of-the-art fleet management solutions and industry-leading location-based products. FOUNDATION Founded in 1991, TomTom has grown from a Dutch-based startup company into a leading multi-national, global brand. The original founders remain committed to the business and...

  • Page 8
    ... provided specialist data, technology, knowledge, and resources to deliver a best-in-class navigation and location-based experience for our customers. the recent years. Together with our state-of-the-art real-time traffic information and navigation software, TomTom's products are sold to customers...

  • Page 9
    ... company. To create and maintain our various products and services, we process billions of data points every day and, for example, we use petabytes of road side imagery every day. We do this on a global scale. A significant part of the information is contributed by our users or in other ways relates...

  • Page 10
    ..., an increase of 9% compared with 2014. This reflects significant investments in our new mapmaking platform and in advanced content and software for the automotive industry. We have over 3,500 people working in R&D across 40 countries globally. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 9

  • Page 11
    ...devices. WEBFLEET: SOFTWARE-AS-A-SERVICE FLEET MANAGEMENT SOLUTION Our Telematics business offers fleet management solutions for commercial fleets of any size. WEBFLEET is a Software-as-a-Service solution - used by small to large businesses to improve vehicle performance, save fuel, support drivers...

  • Page 12
    ... Our activities are organised around four customer-facing business units that leverage our brand, capabilities, and common technology assets to provide consumers, businesses, governments and local authorities with industry-leading location-based products. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 13
    ... GPS performance and innovative design and features aimed at satisfying real consumer needs and desires. LICENSING Our Licensing business sells maps, traffic and navigation software. It also offers cloud-based products and platforms that allow developers easy access to content to create location...

  • Page 14
    ... software for the automotive industry (e.g. to enable Autonomous Driving) and in our new mapmaking platform. We expect these investments to lead to higher Automotive revenue in the mid-term. We have also invested more in acquisitions than in recent years. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 15
    ... and new customers for connected navigation, Advanced Driver Assistance Systems (ADAS), and Autonomous Driving. We are committed to play a leading role in Autonomous Driving and our product roadmap reflects our strategy to map the global road network with precise road geometry data. In 2015, we...

  • Page 16
    ... automatically process an increased volume of realworld changes reported by remote in-car sensors and connected devices while minimising the time between detecting changes in the real world and updating the map on the end user's device or platform. TOMTOM IS A GLOBAL LEADER IN DIGITAL MAPPING With...

  • Page 17
    ... world and updating the map on an end user's device, we can deliver near real-time maps. Our maps are created and delivered via a formula that relies on: Intelligent Mapmaking, Closed Loop and Easy-To-Use Map Delivery Formats. In today's world, people expect to be always connected and their map data...

  • Page 18
    ... assured process is transactional, the map database is continuously releasable. EASY-TO-USE MAP DELIVERY FORMATS TomTom delivers global real-time map updates to customers via fast and frictionless map distribution mechanisms, including MultiNet-R, Navigation Data Standard (NDS) and Map Content API...

  • Page 19
    ...the safety, comfort and efficiency of vehicles to a level beyond imagination. Autonomous Driving will require advanced map components to support numerous vehicle systems. Enabled by our new map technology and infrastructure, we launched two Autonomous Driving related products in 2015. HD MAP TomTom...

  • Page 20
    ...solutions are required to deal with traffic planning, traffic control and to organise safer, greener and more comfortable mobility in cities. A GLOBAL LEADER IN REAL-TIME TRAFFIC INFORMATION TomTom has created a comprehensive product portfolio for traffic and travel information as well as road data...

  • Page 21
    ... app for Android phones was rolled out to 16 countries by the year-end, adding to a community of over 4.5 million users contributing to our speed camera database quality. In 2016, we will continue to strengthen our traffic services with innovative content and delivery formats using a growing number...

  • Page 22
    ...providing routes. Instead, the connected traveller will experience how mobility as a whole will benefit individuals while also providing improved traffic solutions for municipalities. We are collaborating with key partners in the automotive industry, public authorities, information service providers...

  • Page 23
    ... We delivered a free text search engine for NDS this year. This feature required development of new algorithms to enable a more flexible search paradigm. Free text search means that a user can search without using the structured format of listing the country, city, street name and address number. As...

  • Page 24
    OVERVIEW MANAGEMENT BOARD REPORT TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 23

  • Page 25
    ... his research work on digital map databases and routing. In 1989, I&M was integrated into the Dutch Tele Atlas Group. As of 1990, Alain headed Tele Atlas, which was acquired by TomTom in 2008. Alain became a member of the Management Board of TomTom in 2008. Alain graduated as an engineer-architect...

  • Page 26
    ... multi-product consumer business introduced to the GO range in the second quarter of the year. Lifetime World Maps allows people to drive with maps from around the world at no extra cost, for the lifetime of their TomTom GO device. Lifetime Speed Cameras lets drivers know the locations of all speed...

  • Page 27
    ...and maps revenue. The European PND market volumes declined by 8% in 2015 (2014: -11%). The North American PND market declined by 22% in 2015 (2014: 23%). Our PND business developed better than the market. We maintained our leading market position in Europe, improved our market share in North America...

  • Page 28
    ...-driving cars need up-to-date, high quality maps to properly position themselves on the road. Our transactional mapmaking platform enables TomTom to deliver real-time map updates to customers, also enabling OEMs to offer safe, accurate and competitive ADAS TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 29
    ... of the phasing out of certain legacy contracts in combination with a higher share of deferred revenue compared with 2014. Deferred revenue in Automotive relates to map and traffic services from recent contract wins that will be delivered over time. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 28

  • Page 30
    ... to deliver real-time maps • Maximise Licensing revenue via existing and new customers • Broaden product portfolio by new map feature offerings and by stronger location-based services delivering online maps using our global maps and traffic products for the Uber driver application. We have...

  • Page 31
    ... positioned to play an important role. The new mapmaking platform will enable us to create fresh and more detailed maps with high quality that takes full advantage of the growing sensor data offered through connected devices. These maps, combined with our leading traffic products and online delivery...

  • Page 32
    ...by Berg Insight. A strong product portfolio, with WEBFLEET at its centre, has been key to our market-leading success. Continuous innovation ensures customers benefit from a market-leading fleet management software that is adaptable and future-proof. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 31

  • Page 33
    ... insurance solution, using a smartphone app to provide feedback on driving style. Pon, the largest importer of cars in the Netherlands, adopted the Connected Car technology from Telematics to offer dealerships and customers real-time information into their vehicles' status and performance. BUSINESS...

  • Page 34
    ... last year. We also invested more in marketing to support the launches of our new products this year, which resulted in a â,¬14 million increase of marketing expenses compared with 2014. Selling, general and administrative (SG&A) expenses increased TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 33

  • Page 35
    ... in our core technologies to be higher than last year. In particular, we are investing in advanced content and software for the automotive industry (e.g. to enable Autonomous Driving) and in our new mapmaking platform. The number of employees in 2016 is expected to be higher compared with 2015. NET...

  • Page 36
    ... areas is important to growth. We have made significant investments in understanding exactly what our employees need and want so that we can offer customised experiences, in having the right managers in place to manage our increasingly agile and TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 35

  • Page 37
    ... Map Operations and Software Development. The World Class Software Development Programme has continued to deliver value to the company in its third year of existence. These results have included further refining the way TomTom scales its Agile development, sharing best practices across product units...

  • Page 38
    ... market competitive benefits such as pension and health care according to each country's unique context. Next to these important benefits, we also offer a product discount programme to encourage ownership of TomTom products. Long-term incentives for senior management and key individuals are part...

  • Page 39
    MANAGEMENT BOARD REPORT In 2015, we launched our Achieve More Proposition - 'At TomTom you can achieve more in less time than at any other company '. This employee value proposition not only reflects the general consensus about what makes working at TomTom a unique experience, but also has been ...

  • Page 40
    ... touch-points, our new solution also makes it easy for candidates to search and apply for jobs from any device and import relevant information from social profiles, such as LinkedIn, giving TomTom a competitive edge in the War for Talent. In 2015, we appointed Pontoon Solutions as the global Managed...

  • Page 41
    MANAGEMENT BOARD REPORT CORPORATE SOCIAL RESPONSIBILITY COMMUNITY GIVING At TomTom we are committed to having a strong, positive social impact. In 2015, we continued to focus our CSR activities on supporting causes across the world through financial contributions, donations of TomTom products & ...

  • Page 42
    ...there were no high-risk findings. As a result, we did not conduct any independent supplier audits in 2015. BUSINESS OUTLOOK In 2016, we shall maintain our efforts to improve internal processes for the management of our product compliance programme. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 41

  • Page 43
    MANAGEMENT BOARD REPORT BUSINESS RISKS TomTom can be adversely affected by a variety of business risks and economic developments. A structured risk management process helps management to better understand how risks might impact the company and to take appropriate risk mitigation initiatives that ...

  • Page 44
    .... We continuously develop new innovative products in the navigation area as well as in sports. When opportunities arise we enter into carefully selected strategic partnerships to bring competitive products and service offerings to the market. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 43

  • Page 45
    ... will strengthen TomTom's competitive positioning by moving away from traditional batch processing towards a continuously releasable real-time map. Additionally, we have set up partnerships to develop technologies to support Autonomous Driving. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 44

  • Page 46
    ... our World Class Software Development Programme. UNAVAILABILITY OF ONLINE SERVICES We provide a variety customer-facing online services on a 24/7 basis. These include fleet management services, live traffic information, location-based services and sales via our website. To provide these services to...

  • Page 47
    ... and liquidity. RISK RESPONSE We structurally deploy and maintain information security governance, controls, processes and tools in our engineering, operations and products using a risk-based approach, based on ISO information security standards. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 46

  • Page 48
    ... any negative foreign currency effect by conscious and calculated pricing of TomTom products and services to combat the negative impact of the exchange rate movement. For additional information, see note 28 to the consolidated financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 47

  • Page 49
    ... supports business objectives and a culture that encourages open and transparent communication; Amsterdam, 9 February 2016 The Management Board Harold Goddijn / Chief Executive Officer Taco Titulaer / Chief Financial Officer Alain De Taeye / Member of the Management Board â- A financial shared...

  • Page 50
    MANAGEMENT BOARD REPORT CORPORATE GOVERNANCE TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 49

  • Page 51
    ... and functional excellence throughout the company, the Management Board has established a Code of Conduct, and a set of business policies and procedures, which have been rolled out to all employees globally. In this section, we address our overall corporate governance, and provide information on...

  • Page 52
    ... the company. Matters in which the company has a conflict of interest with a member of the Management Board in his private capacity are subject to the prior approval of the Supervisory Board. During 2015, no such conflicts of interest were reported. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 51

  • Page 53
    ...expert. For an overview of all activities performed by the Committees, reference is made to the Supervisory Board Report section. The terms of reference of each committee can be found on TomTom's corporate website: corporate.tomtom.com/supboard.cfm. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 52

  • Page 54
    ... public notice via the company's corporate website: corporate.tomtom.com/agm.cfm. The compilation of the annual report is a recurring agenda item, as well as the adoption of the annual accounts, the release from liability of the members of the Management Board and Supervisory Board and the execution...

  • Page 55
    ... WITH THE CODE As a Dutch listed company, TomTom is subject to the Code. The Management Board and Supervisory Board recognise the importance of good corporate governance and are committed to complying with the best practice provisions of the Code. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 54

  • Page 56
    ... information, which must be disclosed pursuant to Article 10 of the EU Takeover Directive Decree, is included in the Corporate Governance section, the Supervisory Board Report and the notes referred to herein, to the extent that it is applicable to TomTom. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 57
    CORPORATE GOVERNANCE SUPERVISORY BOARD TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 56

  • Page 58
    ... British DATE OF FIRST APPOINTMENT 13 May 2005 TERM OF OFFICE 2015 - 2017 FORMER POSITIONS 71 / DEPUTY CHAIRMAN Chief Executive Officer and President of ASML Holding NV CURRENT POSITIONS Non-Executive Director of Soitec SA and Global Foundries and Vice-Chairman of the Supervisory Board of...

  • Page 59
    ... OF OFFICE 2014 - 2018 Visiting Fellow and Lecturer at The Wharton School University of Pennsylvania (2001-2003) CURRENT POSITIONS Lincoln Filene Professor of Business Administration at Harvard Business School COMMITTEES Audit Committee FORMER POSITIONS TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 60
    ... the Selection and Appointment Committee. TomTom has positioned itself back for growth with its revenue growth in 2015. The company showed continued growth in the Licensing and Telematics business. It's Consumer business continued to broaden its revenue base with new products in the sports category...

  • Page 61
    ... the vacancy status of key positions. The Supervisory Board devoted considerable time to reviewing strategic options and discussing the company's long-term strategy. An active role was played in ensuring that the Management Board's ideas were challenged and tested in order to reach decisions...

  • Page 62
    ... quarter, the Supervisory Board was updated on the company's Investor Relations activities, including share price developments, analysts' research and communication with shareholders. The press releases regarding the full-year and halfyear results, and the quarterly trading updates were all reviewed...

  • Page 63
    ... equal contribution, candid discussion and critical thinking. The performance of the Supervisory Board in testing and developing TomTom's strategy was positively rated overall. The focus on the company's talent management as well as succession planning for key positions within the organisation...

  • Page 64
    ... Board in the consolidated financial statements. The information described in the best practice provision II.2.13 (d) of the Code is also provided there. 1. Base salary at median market level Fixed remuneration consists of base salary plus holiday TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 65
    ...'s long-term strategy by the Management Board, reflects the company's vision and the corresponding strategy considerations for 2015 to 2017 with a strong focus on top-line growth. The annual stock option grants are set as a percentage of the fixed salary of the Management Board members. The level...

  • Page 66
    ... in 2016 for implementation in 2017 to increase the percentage of the fixed salary of the Management Board members that determines the annual stock option grants. the organisation. At the beginning of 2015, the HR strategy within the company was shared with the Committee and quarterly updates were...

  • Page 67
    ... Committee meetings to address agenda items relating to the external financial reporting and related press releases. The Committee and the external auditor also met separately, without the Management Board present, in order to facilitate free and open discussions. Other employees were invited when...

  • Page 68
    ... as the geographical spread of TomTom offices and the core activities performed there. In consultation with senior management, Internal Audit selects the areas of the business to be audited during the year. Members of the Committee and the Management Board may at any time request Internal Audit to...

  • Page 69
    ... of the Management Board of their responsibility for the conduct of business in 2015 and the members of the Supervisory Board for their supervision in 2015. The Annual Report 2015 is available at the company's offices on request and on the company's website: corporate.tomtom.com/annuals.cfm. The...

  • Page 70
    CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED FINANCIAL STATEMENTS TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 69

  • Page 71
    ... NET RESULT 10 25,794 18,293 8,032 22,655 18,122 26 171 18,293 22,549 106 22,655 EARNINGS PER SHARE (in â,¬) Basic Diluted 25 0.08 0.08 0.10 0.10 The notes on pages 75 to 110 are an integral part of these consolidated financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 70

  • Page 72
    ... 30,113 -345 29,768 35,430 135 35,565 1. The items in the statement above are presented net of tax of â,¬9.3 million for 2015 (2014: â,¬6.9 million). The notes on pages 75 to 110 are an integral part of these consolidated financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 71

  • Page 73
    ...48,496 54,963 318,935 Trade payables Income taxes Other taxes and social security Borrowings Provisions Deferred revenue Accruals and other liabilities TOTAL CURRENT LIABILITIES 22 10 94,951 4,382... part of these consolidated financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 72

  • Page 74
    ... in the non-current portion of deferred revenue presented under Non-current liabilities. -6,169 152,949 785 147,565 -106,240 257,785 1,404 152,949 The notes on pages 75 to 110 are an integral part of these consolidated financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 73

  • Page 75
    ... COMPREHENSIVE INCOME TRANSACTIONS WITH OWNERS Dividend paid Stock compensation related movements OTHER MOVEMENTS Transfer to legal reserves BALANCE AS AT 31 DECEMBER 2014 7 0 0 13,967 21,...integral part of these consolidated financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 74

  • Page 76
    ... 6: OTHER DISCLOSURES 31. Provisions 32. Commitments, contingent assets and liabilities 33. Remunerations of members of the Management Board and the Supervisory Board 34. Related party transactions 35. Auditor's remuneration 110 110 105 106 107 TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 75

  • Page 77
    ...The activities of the company include the development and sale of navigation and location-based solutions, which include among others: PNDs, sport watches, action cameras, maps, traffic, navigation software and fleet management services. The consolidated financial statements comprise the company and...

  • Page 78
    ...at the date of the balance sheet, whereas the income statement is Detailed explanations of the degree of judgement and assumptions used are included under each of the respective sections in the notes to the financial statements as referenced above. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 77

  • Page 79
    ... cameras, maps and related navigation products and services. The Automotive business unit develops and sells navigation software components, services and content to car manufacturers and Tier 1 suppliers worldwide. Licensing generates revenue by licensing navigation software components, services...

  • Page 80
    ...the group's geographical map data and other contents. (â,¬ in thousands) External revenue by geographical areas Europe1 North America2 Rest of world TOTAL 1. Germany, France and the United Kingdom accounted for respectively 22%, 13% and 13% of our 2015 group revenue. 2. The North American revenue in...

  • Page 81
    ... sale of traffic and map update services, content sales, connected navigation and fleet management services to commercial fleets. The revenue relating to the service element is recognised over the agreed or estimated service period on a straight-line basis. In arrangements where devices are rented...

  • Page 82
    ... the lifetime maps and traffic services bundled in our PND ranges as well as an increased deferred revenue position related to Licensing and Automotive contracts with upfront payments. (â,¬ in thousands) Consumer Automotive Licensing Telematics TOTAL 2015 130,385 22,614 31,180 2,694 186,873 2014 104...

  • Page 83
    ... is available. In relation to the defined benefit plan, the group recognised a liability on the balance sheet based on the present value of the defined benefit obligation at the end of the reporting period. The defined benefit obligation is calculated annually using the projected unit credit method...

  • Page 84
    ...-stock unit gives the right to receive one TomTom share after a three-year vesting period and qualifies as an equity-settled plan. The costs that arise from this plan are spread over the vesting period and have been determined based on TomTom's share price at the grant date. Total 2015 stock...

  • Page 85
    ... group companies as well as the historic volatility of the TomTom NV's stock. The group's employee stock options have characteristics that are significantly different from those of traded options, and changes in the subjective input assumptions can affect the fair value estimate. PHANTOM SHARE PLAN...

  • Page 86
    ... charge. 9. GOVERNMENT GRANTS In 2015, the group received government grants amounting to â,¬5.6 million, in relation to the research and development activities performed by the group (2014: â,¬4.7 million) which have been accounted as a deduction of wage tax expense in line with the nature of the...

  • Page 87
    ... cash-settled share-based payments, certain provisions and tax loss carry forwards. (â,¬ in thousands) DEFERRED TAX To be recovered after more than 12 months To be recovered within 12 months TOTAL -113,043 -3,270 -116,313 -147,016 -1,097 -148,113 2015 2014 TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 88
    ..., for which the ultimate outcome may be uncertain. If the final outcome differs from the group's estimates, such differences will impact the current and deferred income tax assets and liabilities in the period in which such determination is made. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 87

  • Page 89
    ... asset classes was â,¬66.9 million (2014: â,¬51.8 million). 3. The database as acquired at acquisition date (June 2008) represents geographical content data used for the group's digital maps and has a remaining useful life of 12 years and 5 months. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 88

  • Page 90
    ... reliably. Internally generated databases are capitalised until a certain level of map coverage is reached and ongoing activities focus on maintenance. At this point, capitalisation is discontinued. Internal software costs relating to development of non-core software with an estimated average...

  • Page 91
    ...a prospective basis. The gain or loss arising on disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset, and is recognised in profit or loss. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 90

  • Page 92
    ... of operating expenses from shared units, taking into account management's expectation of market size and market share development. The revenue projections of Consumer and Licensing in the forecasted period show a single digit growth rate, while Automotive and Telematics revenues are projected to...

  • Page 93
    ...non-financial key performance indicators. The acquisitions comprise of Location Navigation Pty. Ltd, a mapping company in Australia on 30 April 2015 and Finder S.A., a leading Polish fleet management service provider on 23 December 2015. With these acquisitions, we expanded our global map flootprint...

  • Page 94
    ... Tom Information Technology Co. Ltd. (Beijing Golden Tom). Cyient provides content development and support services. WayTag is a South Africa-based company that allows people and businesses to create a unique location identifier that either refers to a fixed location or to an individual's current...

  • Page 95
    ... above is based on financial statements for the year ending 31 March 2015 and 31 March 2014. Cyient is regarded as an associate as TomTom is represented on its Board of Directors. The fair value of the investment in Cyient is â,¬10.0 million (2014: â,¬10.1million). ACCOUNTING POLICY Associates are...

  • Page 96
    ... and any excess stock. Net realisable value represents the estimated selling price less an estimate of the costs of completion and direct selling costs. 18. TRADE RECEIVABLES (â,¬ in thousands) Gross accounts receivables Allowance for doubtful receivables TRADE RECEIVABLES (NET) 2015 142,829 -4,236...

  • Page 97
    ...sales related to cost of providing services which have been paid in advance. 2015 21,905 9,770 14,150 4,603 3,105 53,533 2014 12,673 3,389 9,475 4,721 2,940 33,198 The carrying amount of the other receivables and prepayments approximates their fair value. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 98
    ...: (â,¬ in thousands) Margin-related accruals 1 2015 65,140 78,648 143,788 2014 64,238 86,456 150,694 Operating expenses accruals TOTAL 1. Margin-related accruals include items such as sales return allowance, rebates and stock protection accrual. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 97

  • Page 99
    ...amount by which the fair value of the consideration received exceeds the nominal value of shares issued. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 98

  • Page 100
    ... equity-settled share-based plans. For the stock options, a calculation is performed to determine the number of shares that could have been acquired at fair value (determined as the average annual market share price of the company's shares), based on the monetary value of the subscription rights...

  • Page 101
    ... Country % of non controling interest 31 Dec 2015 TomTom Africa (Pty) Ltd. TomTom Navigation Taiwan Co., Ltd. TomTom Telematics Chile SpA1 TomTom Telematics Solutions Mexico S.A. de C.V. 1. The group acquired the remaining 20% interest in TomTom Telematics Chile SpA in 2015. South Africa Rep...

  • Page 102
    ... these risks, and to set appropriate risk limits and controls. Financial risk management is carried out in accordance with our Corporate Treasury Policy. The written principles and policies are reviewed periodically to reflect changes in market conditions, the activities of the business and laws and...

  • Page 103
    ... date of the facility agreement at management's discretion. Assuming the amount utilised remains the same until the end of the agreement and the level of market interest as well as the required performance indicators remain constant based on the situation as at 31 December 2015, the expected annual...

  • Page 104
    ... when their fair value is a positive number; otherwise the derivative is classified as a financial liability. All derivative financial instruments are classified as current or non-current assets or liabilities based on their maturity dates and are accounted for at trade date. Financial assets are...

  • Page 105
    ... for the asset or liability, either directly or indirectly (for example, derived from prices); and • Level 3: inputs for the asset or liability that are not based on observable market data. The fair value of financial assets/liabilities carried at fair value through profit or loss and the...

  • Page 106
    ... WARRANTY PROVISON The group generally offers warranties for its products. Management estimates the related provision for future warranty claims based on historical warranty claim information, as well as evaluating recent trends that might suggest that past cost information may differ from future...

  • Page 107
    ... As at 31 December 2015, the group had open purchase commitments with contract manufacturers for certain products and components. Contract manufacturers order the requisite component parts from their suppliers on the basis of forecasts of the number of units required. Manufacturers have commitments...

  • Page 108
    ...incentive achievable is 120% of the annual base salary for the CEO and 96% of the annual base salary for the other members of the Management Board. The actual bonus pay-out depends on certain challenging financial targets (revenue and EBIT). The total remuneration paid/payable to or on behalf of the...

  • Page 109
    ... Board Stock Option Plan and is most recently amended in the 2014 General Meeting. In May 2015, each of the Management Board members were granted new stock options under this plan except for Taco Titulaer who was granted regular employee stock options in 2015. TOMTOM / ANNUAL REPORT AND ACCOUNTS...

  • Page 110
    ... date conditional to the Management Board members still being in service. 2. Marina Wyatt stepped down at the end of July 2015 and Taco Titulaer was appointed as CFO effective from 1 August 2015. Disclosures are provided in line with the mentioned dates. For a description of the stock option plans...

  • Page 111
    .... Certain key management personnel also hold ownership interests in TomTom NV, as disclosed in the Corporate Governance section under 'Notification of substantial shareholdings and short positions'. In the normal course of business, the group receives map development and support services from its...

  • Page 112
    ... B C 2015 25,229 -7,107 18,122 2014 46,405 -23,856 22,549 (â,¬ in thousands) Result of subsidiaries after taxation Other income and expenses after tax NET RESULT The notes on pages 113 to 115 are an integral part of these company financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 113
    ...26 269 2,062,944 D 186 2,078,524 Other liabilities TOTAL CURRENT LIABILITIES 1,558 1,558 1,867 1,867 TOTAL EQUITY AND LIABILITIES 3,048,892 2,963,334 The notes on pages 113 to 115 are an integral part of these company financial statements. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 112

  • Page 114
    ... (2014: â,¬0.3 million). The deferred tax liability results from a temporary difference between the tax treatment and the accounting treatment of the borrowing cost. The movement of the deferred tax liability has been credited to the income statement. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 115
    ... of loans provided by subsidiaries. The interest rate on the loan during 2015 is based upon the applicable inter-bank offered rate plus a margin of 0.7% (2014: 1.3%). Although no repayment period has been agreed the loan has a long-term nature. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 114

  • Page 116
    ...UK subsidiary TomTom Software Ltd. In addition, a German subsidiary, TomTom Germany GmbH & Co. KG., applies the exemption as described in section 264b of the German Commercial Code (HGB) with regard to the publication of the annual financial statements. The company forms a fiscal unity for corporate...

  • Page 117
    ... these financial statements. PROPOSED APPROPRIATION OF RESULT The Management Board proposes to add the net result in full to the Accumulated deficit. FOUNDATION CONTINUITY TOMTOM For a description of the Foundation Continuity TomTom, refer to the Corporate Governance section in this annual report...

  • Page 118
    ... year 2015 in accordance with International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and with Part 9 of Book 2 of the Dutch Civil Code. â- The company financial statements give a true and fair view of the financial position of TomTom N.V. as at 31 December 2015 and...

  • Page 119
    .... We have performed audit procedures ourselves at all in-scope components. We have visited components in the United States of America (TomTom Inc. and TomTom North America Inc.). Our audit coverage for total assets, revenues and audit coverage per account balance included in the key audit matters...

  • Page 120
    ... influence the economic decisions of users taken on the basis of these financial statements. The materiality affects the nature, timing and extent of our audit procedures and the evaluation of the effect of identified misstatements on our opinion. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 119

  • Page 121
    .... On this basis, we selected group entities for which an audit or review had to be carried out on the complete set of financial information or specific items. We communicate with the Supervisory Board regarding, among other matters, the planned scope and timing of the audit and significant audit...

  • Page 122
    OTHER INFORMATION SUPPLEMENTARY INFORMATION TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 121

  • Page 123
    ... Relations website corporate.tomtom.com/investor.cfm contains up-to-date financial information about TomTom. Investors and analysts are encouraged to visit the Investor Relations website regularly for a detailed and up-to-date coverage of the share price, shareholder meetings, quarterly and annual...

  • Page 124
    ... INFORMATION SHARE PRICE PERFORMANCE IN 2015 The graph below shows the indexed closing share price development of the company versus the AMX during 2015. KEY SHARE DATA (in â,¬, unless stated otherwise) Share price at the start of the year Share price at the end of the year Highest closing share...

  • Page 125
    ...-related amortisation and gain, goodwill impairment and restructuring charges on a post-tax basis, and an â,¬80 million oneoff tax gain in 2012. 5. Calculated based on the sales/cost of sales and the number of days in the last three months of the year. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015...

  • Page 126
    ...; quarterly data unaudited) REVENUE Cost of sales GROSS RESULT Q1 2015 205,275 95,403 109,872 Q2 2015 264,613 129,993 134,620 Q3 2015 254,231 119,161 135,070 Q4 2015 FY 2015 282,488 1,006,607 143,523 138,965 488,080 518,527 Research and development expenses Amortisation of technology and databases...

  • Page 127
    ...,627 3,560 121,627 -760 124,427 22,021 124,427 1,117 147,565 -6,169 152,949 785 147,565 1. Includes movements in the non-current portion of deferred revenue presented under Non-current liabilities. TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 126

  • Page 128
    ... NDS North America OEM OS PDA PND R&D SDK WEBFLEET Definition Advanced Driver Assistance Systems the Netherlands Authority for Financial Markets the Amsterdam Mid-Cap Index Applications Average Revenue Per User Average Selling Price the Dutch Corporate Governance Code TomTom NV Corporate Social...

  • Page 129
    SUPPLEMENTARY INFORMATION TOMTOM / ANNUAL REPORT AND ACCOUNTS 2015 / 128