Esmertec First Half 2006 Revenues Expected To Drop Dramatically; Alain Blancquart Resigned as Chairman and CEO; Jean-Claude Martinez Appointed CEO for the Interim Period

19/05/2006 - 11:23

Esmertec(TM) (SWX:ESMN), a leading provider of
world-class software solutions and services for the telecommunication,
interactive multimedia and consumer electronics markets, announces
today it expects revenues for the six months ending June 30, 2006 will
be substantially lower than previously indicated. Compared to revenues
of US$20.1 million for the six months ended June 30, 2005, the
expectation for the same period in 2006 is significantly below US$10
million. This development is due to a sharp price decline in the
embedded Java business of the mobile phone market, and the management
decision to focus more on shorter term contracts, which reduce
financial risk but result in lower revenues.
On the earnings side, the company expects a high loss in the first
half of 2006, even before possible impairment losses on intangible
assets. Operating expenses are expected to be stable compared to the
second half of 2005 and on target, and existing customers continue to
pay based on quarterly shipments.
Alain Blancquart, Chairman and CEO of Esmertec, resigned today
from his position, effective immediately. Hans-Ulrich Muller, Vice
Chairman of Esmertec's Board of Directors comments, "Alain did a
tremendous job in bringing this company from near zero to US$40
million revenue in only three years. After reaching this point and
taking the company public, Alain decided to move to another phase in
his career. The Board thanks him for his vision and energy since
joining the Company in 2002, and for taking Esmertec to a leading
market position with its best-in-class Java software solutions."
Jean-Claude Martinez (52), COO and President of Esmertec's Mobile
Operator Division, has been appointed as CEO for the interim period.
Mr. Martinez has over 20 years of international sales, marketing and
strategic development experience in the IT industry. He was brought in
by Alain Blancquart three years ago and will now take the lead on the
current international and highly qualified management team of the
Company.
As reported earlier this year, the Company will extend its
operations beyond the embedded software market, and consequently
reduce dependency on a single market segment. The business strategy
will also focus on developing software solutions and services for
mobile operators, mobile advertisers and game developers.
The Company will hold its Annual General Meeting tomorrow at
1000hrs CET in Zurich/Switzerland (Hotel Renaissance, Munot 1 & 2,
Talackerstrasse 1, 8152 Glattbrugg).
This communication contains forward-looking statements based on
current expectations and assumptions of the company's management only,
and involve certain risks and uncertainties. The forward-looking
statements contained herein could be substantially impacted by risks
and influences that are not foreseeable at present, so that actual
results may vary materially from those anticipated, expected, or
projected. Esmertec disclaims any intention or obligation to update
and revise any forward-looking statements, whether as a result of new
information, future events or otherwise.

Esmertec is a trademark of Esmertec AG.

About Esmertec

Esmertec is a leading provider of world-class software solutions
and services for telecommunication, interactive multimedia, and
consumer electronics markets. Engineered for smallness and mass
consumption, Esmertec's wireless Java(TM) ME solutions, mobile
applications and object-oriented software platform (OSVM(TM)) are
developed to extract maximum performance from hardware environments.
Esmertec Cellicium's premier mobile browsing solutions, applications
and services are designed to bring interactive mobile services to
mobile operators. Founded in 1999, Esmertec is a global company
headquartered in Zurich-Switzerland with subsidiaries located in
China, Denmark, France, Japan, South Korea, the UK and the USA, and
representative offices in Taiwan and South Korea.