TomTom, the Dutch satellite navigation provider, raised its full-year outlook yesterday after reporting a nearly 50 per cent rise in third-quarter profits, saying that providing real-time traffic information via portable devices would drive its growth in future.

Europe’s largest maker of car navigation devices announced a net profit of €99 million (£69 million) for the third quarter, up from €68 million in the previous quarter.

Sales of the TomTom devices, which guides drivers with audible instructions and three-dimensional maps, reached €427 million, up from €380 million in the previous three months but below analyst expectations.

The company did not provide any update on its proposed €1.8 billion takeover of Tele Atlas, the world’s second-largest digital maps supplier.

In a sign of its confidence in the outlook for the sat-nav market, TomTom raised its full-year sales outlook by €100 million, to between €1.7 billion and €1.8 billion, and forecast sales of up to 16 million units.

Harold Goddijn, its chief executive, said: “During the third quarter we reached a market share of approximately 21 to 22 per cent in the US. In the past weeks we have seen that go up to about 27 [per cent], so we anticipate that we will be able to reach the 30 per cent mark this quarter.”

Services such as real-time traffic information could help TomTom to hold its own against mobile handset makers such as Nokia, which are beginning to add GPS technology to phones.

Mr Goddijn said: “In 2008 in countries where it will be available we expect that we can sell a substantial percentage of our products as wireless connected products. Traffic information is our largest and most important element to push that strategy. It’s a Trojan Horse for getting devices out, but once they are there and that link is available, we can think about all sorts of other services we can bring to the market. For instance, navigation devices could receive real-time data on available parking spaces and direct drivers to the parking spot closest to the destination.”

TomTom shares rose 8.73 per cent to €61.75 in Amsterdam.

TomTom will offer a real-time traffic service in the Netherlands from next month, with Britain and other European countries to follow next year. The service monitors traffic speed using data gathered anonymously by mobile phone operators who track phones as they move through the network, enabling TomTom to cover a larger number of roads with higher precision than existing systems.

Peter and Pieter

— In 1991, Peter-Frans Pauwels and Pieter Geelen set up a company in Amsterdam called Palmtop to develop applications for handheld devices

— In 2003 it was renamed TomTom and offered the first mobile in-car navigation solution, the TomTom Navigator

— It is the world’s largest navigation solution provider and its products are sold in 30 countries

— Models include the GO family, the ONE XL and ONE ranges and the TomTom RIDER

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