Philips experiences quarterly loss despite turnover growth

Over the past quarter, Philips has made a 39 million euro net loss, because of one-time costs. Turnover did grow 9 %, mainly thanks to increased medical appliance sales.

7.1 billion euro turnover

Philips’ fourth quarter turnover reached 7.1 billion euro, although its 9 % turnover growth was almost entirely because of advantageous exchange rate fluctuations, because there was ‘only’ a 4 % like-for-like turnover increase.

Its medical appliance division posted the biggest growth, up 15 % to 3.3 billion euro. Its consumer division also performed well, with an 8.8 % growth to 1.7 billion euro. Its lighting division, which will become independent over the course of the next few months, managed a 2.6 % turnover increase, to some 2 billion euro.

The Dutch technology concern had a 39 million euro net loss, compared to a 134 million euro net profit last year. The loss is mainly the result of a one-time cost incurred for pension risks and higher taxes. Operational profit grew 13 % to 842 million euro.

Philips’s yearly turnover in 2015 reached 21.4 billion euro (+ 13 %) and a 659 million euro net profit, up 60 % over 2014.

“Not in a hurry” to sell Lumileds

CEO Frans Van Houten explained the company’s intention to spin off its lighting division in the first half of 2016 (probably through an IPO) and he also gave more information about its failed Lumileds sale to Chinese investor Go Scale Capital after the American authorities blocked the move.

The CEO admitted the search for a new buyer will not be easy and take its time. A sale will not be likely “before the summer” and that the price may be lower than what the Chinese were willing to pay, “but we are not in a hurry to strike much weaker, less attractive deal”, he said.