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The world might be suffering through a banking crisis, but so far that has not hurt the sales of the world's largest supplier of banking smart cards, France-based Gemalto NV. The company, in fact, credits the crisis in part for an 12.2% increase in sales in its banking card unit in the third quarter, to 113 million euros (US$163.2 million) from 100.7 million euros the previous year, according to results reported Thursday. Consumers apparently opened new banking accounts in Europe and beyond at a prodigious pace during the quarter in an effort to spread their money around, according to Gemalto CEO Olivier Piou. "They (banks) have never seen so many (accounts) created in such a short time," he told financial analysts Thursday. "[Banks] will not let those customers go. [Banks] are willing to give them very good credit cards and all sorts of goodies. Gemalto is doing well." The vendor reported that sales of smart cards in its banking unit, Secure Transactions, increased by at least 42% to 76 million units during the quarter, up from 53 million during the same period in 2007, though the shipment figures were rounded by Gemalto. Most shipments were banking cards shipped to Europe and the Americas, although the unit also produces pay-TV and transit cards. The unit also includes revenue from card personalization, mainly of banking cards, which grew 33% for the quarter. After accounting for currency fluctuations, sales in the banking unit increased by just under 18%, Gemalto says. But the vendor's smaller rival Oberthur Technologies, also based in France, reported Thursday that third quarter sales in its payment unit fell by 3.1% to 66.7 million euros at actual exchange rates, not counting its acquisition of Scandinavian vendor XPonCard earlier this year. Unlike Gemalto, Oberthur said it saw a drop in volumes of banking cards shipped to Europe, especially to the United Kingdom. And Oberthur said the "negative impact" of exchange rates for the UK pound and U.S. dollar affected the company. After adding revenue from XPonCard, sales in Oberthur's payment unit increased by 16.4% to 80.1 million euros from 68.8 million euros during the third quarter of 2007. For Gemalto, the higher sales in its Secure Transactions unit helped push up total sales for the quarter to 417.8 million euros, an increase of 4.3% before currency adjustment. The quarterly revenue includes sales of SIM cards for mobile phones, and ID cards and electronic passports. Piou cautioned he is still "very paranoid and very vigilant" about the impact of the financial crisis and expected recession on Gemalto's business. "But the more we dig, the more we are finding opportunities," he added. Gemalto predicts sales will grow by 8% to 12% for all of 2008, and also confirmed it will hit its profit projections for the year and its goal of more than 10% operating margin in 2009.
