Symbian Limited H1 2004 results

Worldwide shipments of Symbian OS phones reach 5m in first half of 2004

LONDON, UK, 4th August 2004 - Symbian Ltd today released the following unaudited financial and operational figures for the second quarter and the six months ended 30th June 2004:

H1 2004 Operational Highlights

• Global shipments of Symbian OS-based phones grew to 5.0m (H1 2003: 2.7m units) in H1 2004, a year-on-year increase of 85%, bringing the total installed base of Symbian OS phones to more than 15 million.
• At the end of H1 2004, six Symbian OS licensees were shipping a total of 23 Symbian OS products to network operators in Japan and throughout GSM / GPRS territories worldwide
• During H1 2004, Symbian OS licensees announced products targeted at a wide range of mobile networks, geographical markets and customer segments:
  • W-CDMA, 3G products for European and Japanese network operators including Nokia 6630, FOMA F900i, F900iT and Motorola A1000
  • GSM / GPRS, 2.5G products included Arima ASP 805, BenQ P31, Nokia 7610 and Nokia 6260, Panasonic X700, Samsung SGH-D710, Sony Ericsson P910
  • Products and variants for specific regional markets such as Siemens SX1c and Sony Ericsson P910c for Chinese markets; Sony Ericsson P910a, Nokia 6620 for North and Latin American EDGE and 850MHz networks
  • Market segment-targeted devices such as Nokia's QD game deck and the Nokia 9500 Communicator for enterprise markets
• At the end of H1 2004, 34 phones and variants based on Symbian OS were under development by 10 licensees (end of H1 2003, 26 phones & variants and 9 licensees) - see Notes to Editors for definitions
• Three new Symbian OS licensees were announced during the first half of 2004
  • LG Electronics, the world's fifth largest mobile phone manufacturer
  • Arima, a leading Taiwanese manufacturer of mobile terminals
  • Lenovo, formerly known as the Legend Group, the largest IT corporation in China
• Commercially available third party applications for Symbian OS phones rose to 2,954 (end H1 2003 - 1,323 applications) (Source: Symbian research, see Notes to Editors for methodology)
• £50m rights issue completed to fund accelerated development focused on enhancing Symbian OS as a platform for lower cost, mid-range phones
  • annualised cost base to rise from c.£70m to c.£100m within 18 months
  • headcount to rise from c.900 to c.1,200 full-time and contract employees worldwide.
    

David Levin, Chief Executive Officer, Symbian Ltd said:
"Symbian has performed in line with our expectations in the first half of 2004 with five million phones using Symbian OS being shipped to network operators worldwide, taking the installed base of Symbian OS phones to more than 15 million".

The number of Symbian OS phones in development continues to grow; 34 products and variants from 10 Symbian OS licensees are in development.  These products are targeted at a wide range of network technologies (GSM / GPRS, CDMA, EDGE and WCDMA), geographical and language specific markets (Europe, North & Latin America, Japan, China), as well as customer segments such as gaming and enterprise users.

Symbian OS continued to attract new licensees with LG Electronics, Arima and Lenovo becoming Symbian OS licensees during the first half of 2004.  Symbian OS is attracting growing support from the wider application development community; just under 3,000 commercial third party applications for Symbian OS phones are now available (end H1 2003 - 1,323 applications). (Source: Symbian research, see Notes to Editors).

In May, Symbian launched Symbian Signed, an application certification program that has been endorsed by Orange, T-Mobile, Nokia and Sony Ericsson.  This program builds on Symbian's existing support for application developers by creating even wider commercial opportunities for third party Symbian OS applications and offers faster routes to market that require less cost and effort.

With completion of the £50m rights issue and strong support of its shareholders, Symbian will accelerate development of Symbian OS with a particular focus on evolving Symbian OS to enhance its suitability as a platform of the development of lower cost, mid-range phones.

Symbian looks forward to further phones based on Symbian OS being announced and commencing shipment during the second half of the year.  Sales of phones recently announced and to be announced during the second half will largely determine Symbian's full year performance.  As in previous years, sales are likely to be heavily weighted towards the last four months of the year."

- Ends -

Unaudited Financial and Operational Highlights
 

	H1 2004	H1 2003	Q2 2004	Q2 2003
Symbian OS Units	4.99m	2.68m	2.59m	1.49m
Average Royalty / Unit *	US$5.9	US$6.2	US$5.3	US$6.3
Royalty GP% *	84%	83%	85%	83%
Turnover (£m)	£m	£m	£m	£m
Royalties *	16.3	10.2	7.7	5.8
Consulting services	9.1	9.1	5.3	4.9
Partnering & Other	1.1	1.7	0.7	1.2
	26.6	21.1	13.7	11.9
Average Permanent headcount	779	721	793	731
	End H1 2004	End H1 2003
Cash at hand & in bank	£9.5m **	£29.7m
	End H1 2004	End H1 2003	End Q1 2004	End Q1 2003
Number of Products in development	34	26	30	20
Number of Licensees with Products in development	10	9	9	9

 

*    Royalties include Symbian OS & UIQ
**  Cash at bank is prior to fund-raising announced 7th July 2004

These results do not constitute statutory accounts. They were prepared under the same accounting policies stated in the last audited accounts of the company, which will be filed with Companies House in due course and may be obtained from the Company Secretary, Symbian Limited, 2-6 Boundary Row, Southwark, London, SE1 8HP, UK.

Notes to Editors

1. Definitions and additional information

Royalty revenue - Symbian receives a royalty on each phone based on Symbian OS shipped by licensees.  From Symbian OS v7.0 onwards, the royalty has been set at $7.25 per unit for the first 2 million units shipped by a licensee and $5 per unit thereafter. Symbian also receives additional royalty revenue for devices shipping with the UIQ user interface supplied by Symbian's subsidiary, UIQ Technology AB. Symbian outsources certain technologies when either i) there is already an industry standard developed by another party (e.g. Java from Sun); or ii) the technology is more efficiently provided by an outside supplier (e.g. WAP / web browsers; personal computer connectivity).

Consulting revenue - Symbian undertakes consultancy activities to assist its licensees implement Symbian OS in new handsets.  Symbian receives revenue to cover costs (including full overhead recovery) and provide a commercial gross profit. The level of consulting revenue will fluctuate depending upon the volume of new engagements with licensees and the ability of licensees to develop new devices without the assistance of Symbian.

Partnering & Other revenue - Symbian derives a further revenue stream from training activities, partner activities (including the Symbian Platinum Partner Program) and trade shows (including the annual Symbian Exposium). These activities are designed to promote Symbian OS and are therefore priced only to enable full cost recovery.

Products in development - Symbian defines a product in development on basis of the criteria below:

• Symbian OS licensee has a significant development team engaged on the project
• there is a clearly defined plan to take the product through development to shipping
• the product is anticipated to ship in commercial volumes

2. Number of Symbian OS applications

Symbian tracks the number of commercially available Symbian OS applications.  This is done through surveying the applications offered for sale by a wide range of on-line, commercial distributors of Symbian OS applications.

To be included in the count of Symbian OS applications, an application must be offered for sale by a company, not an individual. 

Applications which are offered for sale but which do not meet these criteria are regarded as "Shareware". Symbian maintains separate counts for "Shareware", “Freeware" and "Open Source" applications.

Only applications written for, or specifically shown to work on, Symbian OS phones are included in the Symbian OS application count. The count includes applications written using any of the wide variety of programming languages supported by Symbian OS, including C++, Java (pJava or MIDP), AppForge Crossfire and OPL.

The number of Symbian OS applications does NOT include Java MIDlets that have not been developed specifically for, or have not been explicitly validated as running on Symbian OS phones.  It is therefore likely that there are many more Java MIDlets that will run on Symbian OS phones.

3. About Symbian

Symbian is a software licensing company that develops and licenses Symbian OS, the global open industry standard operating system for advanced, data-enabled mobile phones.

Symbian licenses Symbian OS to the world's leading handset manufacturers. The following Symbian OS licensees have Symbian OS-based mobile phones in production and development: Arima, BenQ, Fujitsu for NTT DoCoMo FOMA, LG, Lenovo, Motorola, Nokia, Panasonic, Sendo, Siemens, Samsung and Sony Ericsson. In 2003, over 6.67 million Symbian OS-based mobile phones were sold worldwide and more than 15 million have been sold to date.

Symbian has its headquarters in London, United Kingdom with offices in the United States, Europe and Asia (Bangalore, Beijing, Seoul and Tokyo).

Media Enquiries

Peter Bancroft VP, Communications Symbian Ltd +44 20 7154 1546

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