Chinese presence lifts Philips sales
Adjusted earnings before interest, taxes and amortisation increased to €532m, said the maker of medical scanners and diagnostic gear. Sales rose 4% on a comparable basis to €4.1bn, missing the average estimate of analysts of €4.23bn.
“From a geographic standpoint, China was a star performer with double-digit growth in the period,” Natixis analyst Alain William said in a note. The company signed new strategic partnerships in the region, and saw business grow in the private hospital segment.
Philips has made a series of acquisitions in recent months that have focused the 126-year-old Dutch company on health technologies including software and services. In the process, the company has moved away from its historic roots in manufacturing light bulbs, TVs and CD players.
The latest financial figures include as a discontinued operation Philips Lighting, the spinoff in which it has cut its stake to about 40%. Chief executive Frans van Houten said the company plans to sell down further.
“Philips has made a very massive transformation over the last five years and we have pivoted to be a focused health company,” he said.
He dismissed a profit warning from rival General Electric, saying “we are not distracted by other performing businesses in other sectors.”
Philips had a “particularly strong quarter” in China, both at the consumer and hospital businesses, he said, adding that he expects growth at private hospitals to offset any risk of governments giving preference to domestic suppliers. Sales of toothbrushes are also increasing.
Bloomberg
