GEMPLUS INTERNATIONAL S.A.
Table of Contents

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or
15d-16 of the Securities Exchange Act of 1934

For the month of April 2004

GEMPLUS INTERNATIONAL S.A.

(Exact name of registrant as specified in its charter)

GEMPLUS INTERNATIONAL S.A.

(Translation of registrant’s name in English)

Aerogolf Center
1 Hohenhof
L-2633 Senningerberg
Grand Duchy of Luxembourg

(Address of Principal Executive Offices)

(Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F.)

     
Form 20-F [X]
  Form 40-F [   ]

(Indicate by check mark whether the registrant by
furnishing the information contained in this form
is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.)

     
Yes [   ]
  No [X]

 


TABLE OF CONTENTS

SIGNATURE
Litigation update


Table of Contents

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

         
    GEMPLUS INTERNATIONAL S.A.
Date: 7 April, 2004,        
    By:   /s/ Stephen Juge
     
        Name: Stephen Juge
        Title:   Executive Vice President and General Counsel

 


Table of Contents

Litigation update

Luxembourg – April 5, 2004 – Gemplus International S.A. (Euronext: LU0121706294 – GEM and NASDAQ: GEMP), the world’s leading provider of smart card enabled solutions, today reported the recent developments in a lawsuit concerning an alleged breach of contract by Gemplus S.A., a subsidiary of Gemplus International S.A. in France, regarding the promotion of smart card solutions for casino slot machines.

As requested by Gemplus S.A., on April 2, 2004, the Aix-en-Provence Court of Appeal decided to suspend the decision of the Marseille Commercial Court rendered on March 18, 2004, that had ordered Gemplus S.A. to make a direct payment to the plaintiffs of damages of approximately 22 million euros, despite Gemplus S.A.’s immediate appeal. The Court of Appeal also ordered Gemplus S.A. to make a cash deposit in the same amount into an escrow account as security pending the decision on the appeal on the merits.

Following the recent decision of the Commercial Court, and based on the Company’s analysis and advice of counsel, the Company decided to increase the provision made for this case in its first quarter 2003 (1.8 million euros) by an amount of 3.4 million euros. This results in a total provision for this case of 5.2 million euros in the Company’s consolidated accounts at December 31, 2003.

As a consequence, the operating results relating to the fiscal year and fourth quarter 2003 will show a decrease of 3.4 million euros compared to what was previously announced. This accounting treatment complies with IFRS1 and Luxembourg GAAP2. The latter recommends that, up to the sending of the annual accounts to the shareholders before the annual shareholders meeting, the consequences of an event subsequent to the close of a fiscal year should be integrated into the past fiscal year accounts. The financial statements including this change will be available on the Group’s web site (www.gemplus.com) when the annual accounts are sent to shareholders for the annual shareholders meeting that will take place on April 27, 2004.

The payment into the escrow account will be credited during the second quarter 2004 ending June, 30, 2004. This amount will be considered as restricted cash and, as such, will be booked in other current assets, as of the second quarter 2004.

As previously reported, this lawsuit was commenced in 1997 relating to an alleged breach of a contract signed in 1992. The case involves a market segment which, from Gemplus’s point of view, has very little or no development potential, as confirmed by the lack of evolution in this segment to date. The conclusions of the expert’s report, on which the Marseille Commercial Court based its decision of March 18, 2004, are that the development potential of this segment is very significant. Gemplus S.A. contested the expert’s report as well as the related estimated damages and the merits of the case on various grounds, and immediately filed an appeal.


1   International Financial Reporting Standard
2   Generally Accepted Accounting Standards

(GEMPLUS LOGO)

1


Table of Contents

     
Contacts:
   
 
   
Press
   
Gemplus
  Investor Relations
Marielle Bricman
  Gemplus
Tel: +33 (0) 4 42 36 55 96
  Celine Berthier
Mob : +33 (0) 6 74 68 72 82
  Tel: +41 22 544 5065
Email: marielle.bricman@gemplus.com
  Email: celine.berthier@gemplus.com

Some of the statements contained in this release constitute forward-looking statements. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activities, performance, or achievements expressed or implied by such forward-looking statements. Actual events or results may differ materially. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Factors that could cause actual results to differ materially from those estimated by the forward-looking statements contained in this release include, but are not limited to: trends in wireless communication and mobile commerce markets; our ability to develop new technology, and the effects of competing technologies developed and expected intense competition generally in our main markets; profitability of our expansion strategy; challenges to or loss of our intellectual property rights; our ability to establish and maintain strategic relationships in our major businesses; our ability to develop and take advantage of new software and services; and the effect of future acquisitions and investments on our share price. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such forward-looking statements. The forward-looking statements contained in this release speak only as of this release. We are under no duty to update any of the forward-looking statements after this date to conform such statements to actual results or to reflect the occurrence of anticipated results.

About Gemplus

Gemplus International S.A.(Euronext: LU0121706294 – GEM and NASDAQ: GEMP) is the world’s leading player in the smart card industry in both revenue and total shipments (source 2002: Gartner-Dataquest, Frost & Sullivan, Datamonitor.) It has the largest R&D team, unrivalled experience, and an outstanding track record of technological innovation.

Gemplus offers an exceptional range of portable, personalized solutions that bring security and convenience to people’s lives. These include Mobile Telecommunications, Public Telephony, Banking, Retail, Transport, Identity, WLAN, Pay-TV, e-government, access control, and a wealth of other applications.

Gemplus’ revenue in 2003 was 749 million Euros.

www.gemplus.com

©2004 Gemplus International S.A. All rights reserved. Gemplus, the Gemplus logo, GemXpresso, MySIMCopier, Gemsense Pro, m-Banxafe, and Your Passport to the Digital Age are trademarks and service marks of Gemplus S.A. and are registered in certain countries. All other trademarks and service marks, whether registered or not in specific countries, are the property of their respective owners.

(GEMPLUS LOGO)

2