“We have seen a decline of the PND market against a background of a weak consumer electronics market which impacted our Consumer business. On the other hand, sales by Automotive and Business Solutions grew as did our LIVE Services revenue.

Based on the outlook for the PND market, we will reduce our cost base in the coming quarters to maintain a healthy cash flow, whilst at the same time continuing to invest to support our growing revenue lines.”

¹ Operating expenses include an impairment charge of €512 million and restructuring charges of €0.2 million in Q2 2011, €1.2 million in Q2 2010 and €0.6 million in Q1 2011
² Excluding impairment charge and related tax effects
³ Earnings per share adjusted for impairment, acquisition-related amortisation and restructuring charges on a post tax basis

Outlook 2011

Consumer electronics markets have been weak and the retail channel has continued to reduce the level of inventory it is carrying. PND markets have been declining and we expect this trend to continue in the second half of the year. We expect our core combined PND markets to decline at the high end of the previously communicated range of between 15 and 20%, particularly as a result of a steep decline in the North American market.

Automotive will continue to grow its systems business as well as its licensing business as expected.

Business Solutions is expected to accelerate its growth in the second half of the year on the back of the roll-out of new contracts and geographical expansion.

Licensing is expected to show flat revenue development compared to last year.

We plan to deliver operating expenses for 2011 of approximately €540 million.

As previously communicated we expect full year revenue of between €1,225 and €1,275 million and earnings per share of between €0.25 and €0.30, excluding impairment.

Operational review

Revenue split