Dutch navigation and digital mapping company TomTom reported a 41% drop in second-quarter sales on Wednesday as shop closures and travel reductions saw a plunge in its consumer business, but it said it sees early signs of recovery.

The group did not provide a detailed outlook, but said it expected to generate positive free cash flow in the second half of the year.

The Amsterdam-based company, whose clients range from carmakers Ford and Nissan to tech giants Microsoft and Huawei [HWT.UL], also reported a core profit of 7.3 million euros (£6.61 million), beating forecasts for a 17 million loss in a company-provided poll.

"While enterprise grew throughout, factory and retail closures hit trading conditions for automotive and consum4er in April," said chief financial officer Taco Titulaer, noting that businesses began to recover as lockdowns lifted in May and even more so in June.

The group reported sales of 123.7 million euros, in line with expectations.

Revenues fell 32% in TomTom's automotive segment, which sells location technology to carmakers, and 68% in its consumer businesses, which sells portable satnav devices.

However, the firm's enterprise segment, which sells location technology to technology companies, government bodies and traffic management for location-enabled applications, saw 5% growth.

TomTom has been moving away from selling consumer devices to offering digital map-linked services for software applications.

In April, TomTom had forecast a negative free cash flow and lower revenues in its automotive and consumer businesses in 2020.

(Reporting by Sarah Morland and Anait Miridzhanian in Gdansk; Editing by Shri Navaratnam and Louise Heavens)