Group revenue for the quarter was €244 million, 11% lower compared to €274 million in Q3 '12.
Consumer revenue for the quarter was €151 million, 12% lower compared to €172 million in Q3 '12. PND revenue in Europe was flat as the decline in the PND market was partially offset by the increase in our market share and by a strengthening of our ASP. PND revenue in North America decreased year on year mainly because of the smaller market size. Revenue from fitness products showed a strong growth compared to the same quarter last year.
Revenue from Automotive was €44 million, a decrease of 11% compared to €49 million in Q3 '12, reflecting the on-going lower demand for in-dash devices from our automotive partners as the result of weak car sales in Europe.
Licensing revenue for the quarter was €28 million compared to €33 million in Q3 '12. The decline came mainly from lower GIS Licensing revenue.
Business Solutions generated revenue of €21 million in the quarter, which represents 11% growth compared to €19 million in Q3 '12. Q3 '13 revenue of Business Solutions includes two months revenue from the recently acquired Coordina group. The installed base of WEBFLEET subscribers increased by 39% to 310,000 from 223,000 at the end of Q3 ’12.
Hardware revenue was €151 million for the quarter (Q3 '12: €169 million). Content & Services revenue was €93 million in Q3 '13, €12 million lower compared to Q3 '12, mainly due to lower Licensing revenue. Content & Services revenue represented 38% of total revenue for the quarter (Q3 '12: 38%).
Gross margin
The gross margin was 56% and increased by 1 percentage point compared to 55% in Q3 '12. Both in Q3 '13 and in Q3 '12, the gross margin included some one-off releases in our provisions. Excluding these one-off effects, the gross margin would have been 54% in Q3 '13 compared to 52% in Q3 '12. The year on year increase was mainly due to the change in geographical revenue mix.
Operating expenses
Total operating expenses increased by €5.4 million year on year. We saw an increase in SG&A (€4.5 million) and stock compensation expenses (€1.9 million) partially driven by the increase of our share price. Marketing expenses were slightly down year on year (€2.2 million), as investments were phased to support a planned communication campaign in the fourth quarter.
Financial income and expenses
The net interest charge for the quarter was €0.8 million (Q3 '12: €3.2 million). The other financial result for the quarter was a gain of €0.4 million (Q3 '12: charge of €0.2 million) which consisted primarily of foreign exchange gains on the revaluation of USD denominated monetary balance sheet items.
Income tax
The net income tax charge was €2.0 million in Q3 '13, a decrease of €4.5 million compared to €6.6 million in Q3 '12. The effective tax rate (ETR) in the third quarter was 15.0% compared to 22.7% in Q3 '12. The ETR year to date equals 16.7% (YTD '12: 22.8%). The lower ETR for the quarter was mainly caused by releases of tax provisions.
Net result and adjusted¹ EPS
The net result for the quarter was €11 million compared to €22 million in Q3 '12, which represents adjusted¹ EPS of €0.10 and €0.14 respectively.
Balance sheet
At the end of the quarter, trade receivables amounted to €136 million compared to €171 million at the end of Q3 '12. The inventory level was €56 million, a decrease of €3.6 million year on year. Cash and cash equivalents at the end of the quarter were €228 million versus €137 million at the end of Q3 '12.
The carrying value of our borrowings as at 30 September 2013 was €174 million (Q3 '12: €289 million). Excluding transaction costs, which are netted against the borrowings, our outstanding borrowings amounted to €176 million (Q3 '12: €290 million).
Current liabilities were €415 million compared to €717 million at the end of Q3 '12. The year on year decrease is mainly caused by the fact that our outstanding borrowings were presented as current in Q3 '12 as they fell due for repayment in December 2012. Trade payables amounted to €89 million, €6.6 million lower compared to Q3 '12. Tax and social security amounted to €42 million, €13 million higher compared to Q3 '12 mainly due to timing of corporate income tax payments.
Deferred revenue for the quarter ended at €115 million (Q3 '12: €93 million). The main reason for the year on year increase is a combination of an increase of deferred revenue related to our lifetime maps and traffic in PNDs and higher deferred revenue on Licensing contracts.
At 30 September 2013 we reported a net cash position of €52 million (Q3
'12: net debt of €153 million). Net cash is the sum of the cash and cash
equivalents at the end of the period (€228 million) minus the borrowings
(€176 million).
