Philips Reports 54.1% Decline in Quarterly Earnings

Company showed strong sales however in Latin American, Eastern Europe and India

Medical and consumer electronics giant Philips reported a 54.1% fall in annual second quarter earnings July 14 that it attributed to exceptional gains worth a billion euros in the year-earlier period. The company said its second quarter net profit came to 720 million euros (US$1.14 billion), which surpassed expectations of 152 million euros by analysts.

The second quarter result includes gains from earlier share sales, notably of a stake in Taiwan Semiconductor Manufacturing in the April-June period of 2007.

Philips chairman Gerard Kleisterlee, noting a strong second quarter sales performance, said the group was "well-positioned" to meet its 2010 targets. Sales jumped 7.1% to 6.463 billion euros.

"As the scope and length of the current economic slowdown in Europe and North America are still not clear, we expect growth in emerging markets to continue and that it will support sales in our three sectors (medical, consumer electronics and lighting) in the second half of the year," the company said.

It noted a double-digit expansion in sales of consumer electronic goods in Latin America, Eastern Europe and India.

Sales of televisions, which had recently lagged, rose 14% in the second quarter, partially driven by the European football championship last month, according to Philips.

Copyright Agence France-Presse, 2008

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