Good day, ladies and gentlemen. Welcome to TomTom's first quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. We will be facilitating a question and answer session towards the end of today's prepared remarks, at which time, if you would like to ask a question, you may do so by pressing star one on your telephone. If at any time during the call you require audio assistance, feel free to press star zero, and a conference coordinator will be happy to assist you. Please note that this conference is being recorded. I will now turn the call over to your host for today's conference, Megan Daniell, Investor Relations Officer. You may begin. Thank you, operator. Good afternoon and welcome to our conference call, during which we will discuss our operational and financial highlights for the first quarter of 2021. With me today are Harold Goddijn, our CEO, and Taco Titulaer, our CFO. We will start today's call with Harold, who will discuss the key operational developments, followed by a more detailed look at the financial results and outlook from Taco. We will then take your questions. As usual, I would like to point out that safe harbor applies. With that, Harold, I would like to hand it over to you. Well, thank you, Megan. Welcome, ladies and gentlemen. Thank you for joining us today. I will briefly go over the key operational highlights for the quarter, after which Taco will provide further information on the financials as well as the financial outlook for the year. We had a positive start to the year, and we showed solid progress in product development and attracting new customers. We launched TomTom Navigation for Automotive, which is our next-generation cloud-native but also full hybrid navigation solution. It's a unique product that lives mostly in the cloud but also provides for an onboard map, which makes for a reliable user experience under all conditions, also when the data connection is unavailable. With this release, we're bringing the user experience to a new level, and we are simplifying our operations. There's extensive support for electric vehicle functionality, the new system offers flexible delivery through easy-to-use SDKs and APIs, so it can easily be integrated in any in-vehicle infotainment system. The product will be deployed by multiple leading car makers. The Mitsubishi Outlander showcases the Mitsubishi MI-PILOT Assist, which incorporates TomTom ADAS Map, specifically the information on road curvature and speed limits. This information allows the car's ADAS functions to proactively adapt the vehicle speed, improve to save energy, and guide EV drivers to compatible available charging stations within reachable range. This will reduce travel time and reduce range anxiety. In the enterprise segment, we closed new contracts and expanded our reach in both fleet logistics and on-demand mobility segments. We enjoyed significant increase in the use of our maps APIs. Progress is particularly relevant when you look at the market opportunities we're targeting on the next slide. We see location becoming an essential part of an ever-growing number of applications. By some estimates, 20% of all applications have a location element. While our roots are in vehicle-based applications, which is technically the most demanding application, we see their role in the future to enable a much broader set of customer requirements. We have early success in the enterprise sector, and we have managed to build a long list of triple A customers who rely on our content and technologies to bring location to their applications and platforms. We have a very talented technical team at work to improve the geographical coverage, attribution, and freshness of our database, on the one hand, and build leading services like applications, APIs, and SDKs on top of the data. We see significant opportunity to accelerate those capabilities by using new sources and designing highly automated processes for quality control data ingestion, which eventually lead to a much richer database that we can build and maintain at lower cost. As a result, we are building a rich set of products that offer our customers a powerful platform, the tools, but also the freedom to innovate while staying in control of customer and application data. This concludes my part of the presentation. Thank you for your attention. I am handing over to Taco. Thank you, Harold. I will make some comments on the financials and outlook, and then we'll go to the Q&A. First quarter, we reported group revenue of EUR 131 million. Location Technology reported revenue of EUR 105 million, a year-on-year increase of 15%. Increase was offset by lower revenue from consumer. Let me go through the revenue business by business. Automotive IFRS revenue was EUR 63 million, an increase of 26% compared with the same quarter last year. The strong year-on-year increase in IFRS revenue is because of low comparative quarter. Q1 2020 included revisions to the estimated total contract value of some contracts to account for the impact of COVID-19. Automotive operational revenue was EUR 74 million in the quarter, a decrease of 8% year-on-year, mainly because of lower car production volumes. Automotive operational revenue is directly related to car production volumes. Enterprise revenue increased by 2% from the same quarter last year, reflecting increased revenue from existing customers. In the first quarter, consumer revenue decreased by 34% to EUR 26 million, reflecting decreased demand as lockdowns across Europe continued. In the first quarter, gross margin was 81%, in line with expectations, and reflects lower hardware revenue in our sales mix. OPEX were EUR 121 million, a decrease of EUR 60 million compared with the same quarter last year. The decrease is mainly because of lower amortization, as the Tele Atlas database acquired in 2008 was fully amortized in 2020. Excluding the impact of depreciation amortization, underlying OPEX showed a year-on-year decrease of around 8% as a result of cautiously managing costs. The increased gross margin and low OPEX resulted in a positive EBITDA margin of 6%, an improvement of 10 percentage points year-over-year. The free cash flow for the quarter was an outflow of EUR 4 million, a decline of EUR 18 million compared with the same quarter last year. There are three main reasons for the year-on-year decline. The first is less cash collections in the quarter because of lower opening trade receivable balance when compared with the opening balance in Q1 2020. Secondly, we had a lower operational gross profit in the quarter. Finally, these decreases were partly offset by lower variable personnel expenses in the quarter. We reported a net cash position of EUR 352 million at the end of the quarter. Net cash decreased as a result of lower free cash flow and because of purchases of shares made under the share buyback program. During the quarter, we purchased over 2 million shares for a total consideration of EUR 17 million. The program has a remaining repurchase amount of EUR 60 million, which we expect to complete in the second quarter. On the last slide, the outlook 2021. We are reiterating our full year outlook. For 2021, we expect group revenue to be between EUR 520 million and EUR 570 million, and Location Technology revenue between EUR 420 million and EUR 450 million. We will continue to see year-on-year declines in our OPEX, driven by the decline of total D&A from EUR 285 million in 2020 to between EUR 70 million and EUR 75 million in 2021. Excluding D&A, our R&D OPEX is expected to grow to around EUR 330 million for the full year. We started the year with a cash outflow. There's some seasonality in our cash flow, which is weighted to the second half of the year, particularly the last quarter of the year. This is due to the timing of certain customer payments. We are reiterating our guidance to generate free cash flow of around 6% of group revenue for the year. Operator, we would now like to start the Q&A session. Thank you. We will now begin the question-and-answer session. Your first question comes from the line of Marc Hesselink from ING. Please ask your question. Thank you. Three questions. The enterprise client that you won over the quarter, could you explain a bit more why did you win this contract, and was that being the alternative to Google, or was there anything particular why you were chosen for this one? Second question is the launch of the TomTom Navigation for Automotive. How will this ramp in your business? How many clients are already taking this, and how do you expect it to evolve over the coming years? The third question, the semi shortage in the automotive chain. You're being paid when the car is being produced. How is this impacting you? Do you see it yourself, or is this more something that you see in the sector and you expect it to impact you as well, but you're not really seeing it yourself? Thank you. Marc, thank you. The customer in the enterprise sector I was referring to is in the mobility-on-demand sector. Can't disclose the name. In mobility on demand, it's very important that you have control over your core technology to allocate drivers to cars and passengers and whatnot. Those are hard mathematical problems. You need to have a good toolset and good data to tackle that. Those companies typically spend an awful lot of time and effort and energy on optimizing those algorithms because they do have a direct effect. On service levels, customer perception, and so on and so forth. We can provide those companies with the tools they need to build those services and to optimize their operations. The tools we're providing is, of course, the maps and navigation attributes, but also speed profiles, traffic information, routing algorithms, POIs and so on and so forth. That is a combination of those data and tools is what we believed pulled this particular customer over the line into the TomTom family. Second question about TomTom Automotive Navigation. Fairly unique. We are now, according to our own estimate, the largest vendor of software in vehicles. We have built, of course, it's our heritage, we have invented the category at the time, the navigation category. We've built on our heritage. This is the last iteration, which solves a hard problem for car makers, and that is availability. Everybody wants to go online, that's fine. What do you do when an online connection is not available? That can happen when the car is out of reach, in a parking garage, or in areas where there is no mobile phone coverage whatsoever. You still want that car to work properly. This hybrid solution offers a very elegant solution to this problem. We're very happy that two of our customers have decided to move to this next generation, for future implementation. Last question, if I understood it correctly, Marc, is how the chip silicon shortages in the automotive supply chain affect us. Is that the correct interpretation of your question? Yes. If you're actually seeing that, yes. We have seen it. It's anecdotal. We don't have hard numbers. We have seen reduced demand and shortages compared to the original plans from our OEM customers, as a result of two effects, combined effect of a pandemic that is there for longer and more severe than we had originally anticipated at the beginning of the year, but also chip shortages. How big the problem is not that easy to distill. It's anecdotal. We know it's happening, but we don't know how severe the effect is. Yes, it did have a negative impact on the number of cars that were produced during the quarter. Okay. Maybe a short follow-up on the navigation for automotive. You have two clients using it. Do you expect this to ramp for other clients? Given that it's a superior solution, do you expect quick adoption by those clients? Typically, car makers will go for the latest and the greatest. I see a good future for this line. The early sign-up by the customers I referred to will help us also, of course, to harden the product, see it operating in the wild, which will help both from a product design development perspective as well as credibility perspective. I see a good future, and I expect that over time, this line in our navigation portfolio will overtake all our other products, in the automotive space. How long that will take is less certain. There is inertia. You know as well as I know that design cycles are notoriously long in the automotive world. Definitely, yes, over time, this will overtake everything else that we're doing. Okay. Thank you. You're welcome. Your next question comes from the line of François Bouvignies from UBS. Please ask your question. Hi. Thank you very much. My first question was a follow-up, actually, on this Navigation for Automotive and cloud-native solutions. How do you price and how do you sell this product, in terms of business model? Would be very interesting to know how the value is compared to the old products, and maybe, how do you price that to the customer would be very helpful to understand. The second question is on the automotive market. We are post in a pandemic, or hopefully post-pandemic era. I was wondering how you see the market in terms of deals available for the market as a whole, from a qualitative perspective, and how you see the position there, because we talk every quarter, the newcomers and especially Google, do you see them getting some market share over you in the near future or at the moment as we speak? That's my second question. I have a last one I will ask after, maybe, if you don't mind. I'm making a quick note, François. Yeah, sorry. Yeah. Pricing, let's start there. We have a lot of customers with a lot of products in the automotive industry. Not every client is taking the full stack of what we're doing. Some customers take traffic information, other customers take maps, and other customers take the whole full stack, which is a combination of software services, content, integration services where needed. I think part of strategy is to include and stack those services and those products to a full stack navigation product, for which we can command better prices and for which we have better pricing power. As a result of the success of this version of our software, we hope that we can convince more of our clients to go full stack for the TomTom solution. That will have a positive effect on unit price. Value per car shipped, which is a good thing. If I look at the overall type of money that's available for a full stack solution, I don't expect the total value to go up significantly. I think that has been stable for quite some time. What I've said and what we see again, is that the overall price is relatively stable, but we need to throw in more stuff in order to justify that price. There's a constant battle to deliver more services, better user experience, and in return, we see good ability to hold on to pricing and pricing well. I think that's the way to look at it. A good product and a good software product which delivers a good user experience is the most important thing we can achieve in order to improve pricing power. We see positive results of this move to full hybrid and full stack. Harold, just if I may, how much is full stack of your products? Can you give any numbers around that to get an idea of maybe what the opportunity is in terms of percentage of your customers today? It could be in value or units. Whatever you have would be helpful to know. I don't have that. I can definitely have a look if that's type of information we can make available. I don't know, to be honest. I have a number in my head. I can't disclose it at this stage. I need to have a look at that. Okay. All right. It's definitely true that not all of our clients are taking the full stack. Just to give you an example, we have in traffic information in Europe, about 80% market share. In North America, we have about 40% market share in the automotive sector. That's much more market share than we have in full stack solutions. Okay. That's clear. All right? Thank you. Yeah. Are we post pandemic? I really don't know. To be honest, when we started the year, I had hoped that we would be post pandemic now, we're not. I think the general expectation is that that will happen before the summer. I'm not going to bet the shop on that, to be honest. We still see negative impact for our business of the results of that pandemic. I think for the workforce, it's starting to be difficult. I think we got through it really well, and our people showed a lot of resilience, and engagement has been extraordinary, and collaboration has been really good. Now I think we are entering a period where it starts to get less cool to work from home. I think we need now to go and prepare for a period where we start seeing each other, where we have a free flow of ideas, exchange of information, where we start seeing customers and so on and so forth. I really hope that it's that in a couple of months from now, we can see that happening. That's important. It's important that we get more detail on what our customers are thinking and doing and how they're planning. It's important also that car sales will go up. I think there is pent-up demand. I think we can see a strong recovery once everything is back to normal. I can't wait for that moment to happen. We're not in that period yet. Mm-hmm. In terms of deals available, and your position in terms of winning rate, in a way, how do you? Yeah. Difficult to say. I'm always careful. I don't want to speculate. It's lumpy. You win or you lose. You never know. If I look at the overall opportunity, this year, I think there's significant amount of business available. I think we're well positioned. I prefer to give you information on our win rate when the deal is done, won or lost. It's not a good way of looking at the business on quarter to quarter, which deals you win. That's just not the nature of the work we're doing. I think I feel comfortable giving regular updates about the overall product and order backlog and whatnot, but it's much harder to give you a steer on our ability to win those deals. There's enough around this year. That's not the problem. We're working hard. We're firing on all cylinders. I think we're building a good reputation for product, for service, for being a reliable partner to our automotive customers as well as to our enterprise customers. I think that when it comes to nominations, all those things will play in favor. We can only do that when we've actually won that nomination. Okay, that's very clear. Maybe if I can squeeze one last one is, I asked you this question last year, if I remember correctly. It's around Enterprise, and in the last two years, you have been very active, I would say, and maybe more than people expected and maybe yourself, because you compete obviously much more with Google in this market than in Automotive. You have been winning few deals recently in the last two years, and you announce furthermore, with this new mobility demand, customers that you can close. I'm going to ask you the same question really, do you see any structural change in the last two years? It seems that the business is accelerating for you. Just wanting to understand, what is behind that? Or first, if it's true, if you feel that way as well, and second of all, why is that? Is it because of TomTom product? Is it because of Google? Anything you can share would be very helpful about your insight. I will stop here. Thank you very much. Yeah, sure. Look, location is terribly important. It's becoming more and more important, and there's a lot of applications and services that, in one way or another, depend on location. That's not going to stop. Now, of course, Google is a formidable competitor with a distinct business model, which makes it hard to compete. Where we can compete significantly, where we can make a real difference is in two areas. First of all, we are providing a much more flexible service. If you want Google services, you need to take our APIs, and that's what it is, and you can't do anything. For a lot of companies, that's just not good enough. They need a lot more flexibility, what we call they need freedom to be able to innovate. They need to be in control because they're often part of primary processes that have a direct impact on customer experience, operational efficiency, and profit as a result. You need to be able to offer that level of flexibility. The second thing where we have a distinct business model is that we don't care for application data or customer data. We're not competing. We're not using that information to compete or gain market insight to compete at a later stage. That gives a peace of mind. That allows us to strike deals and have relationships with our customers that are difficult to develop if there's always a hidden agenda or the possibility for a hidden agenda. Those are two big parts of where we can differentiate and how we can compete. The third element is that we want to build a much better product, and I think we can. There's a lot happening in underlying technology, in cloud technology, in computer vision. In availability of all sorts of sources that we can use to build and maintain that map. Deeper collaboration with our customers who are willing to share their data with us at a platform level, and want us to offer an alternative to the companies we just mentioned. Our ability to process that, get a handle on that information that's increasingly available, harmonize it, standardize it, do the quality control, deploy those new technologies that will make it easier to collect data from vehicles, from smartphones, and so on and so forth. The combination of that should take us into a world where mapmaking becomes a more automated process. We have achieved a high degree of automation, but it's mostly automation of manual tasks. We are going into an area where it's the other way around. Where there is so much data and sources available that can be integrated, that really asks for a rethink of how we put data together in the database, and that should help us to build a database that's richer in content, fresher, that covers more geographies, and that can, as a consequence, be used for a lot more applications than we can serve today. That is where we're working on. I'm happy with the progress we're making on that field. Great. Thank you, Harold. Thank you. Once again, if you have a question, please press star then one on your touch tone phone. Your next question comes from the line of Anne Van Lie Peters from ABN AMRO Bank. Please ask your question. Hi, it's Anne Van Lie Peters from ABN AMRO Bank. I'm calling on behalf of Wim Gille, who cannot make it today. Apologies for that. I looked at the results and I think also from previous discussions, you have a very strong balance sheet. Sort of what does your ideal balance sheet looks like? Moreover, also in terms of the expected cost in a post-COVID world, how would you see sort of your expenses evolve in the coming year, one and a half years ahead? Thank you. Yeah. Thank you. The idea on the balance sheet, we're in the middle of a buyback program, of which two-thirds has been completed and one-third is still to go. We'll take stock after that has happened, there are no immediate plans after that. Well, is our ideal balance sheet, we're quite comfortable with the situation that we're in now. Again, we don't have any immediate plans to launch another buyback or schedule dividends or anything like that. On the cost structure, at the like for like, you see material decline compared to last year. That is very much related to the fact that last year we were not in the pandemic phase, or for at least two-thirds of that quarter, we were still in the clear and there were quite a lot of marketing and travel and other things going on. That explains the reason why OPEX was low in the first quarter. As Harold already explained while answering some of the other questions, is that as a company, we will start to ease policies around marketing activities and travel, et cetera. We expect in the coming period that the cost will go back to more normal, and that will start to have an effect as of Q2. Everything in line with our previously made expectation on cash generation and our free cash flow yield. Operator, if there's no further questions, I would like to thank you all for joining us this afternoon. Operator, you may close the call. Thank you. This concludes today's presentation. Thank you for participating. You may now disconnect.