Philips Triples Profit in Q3

Company credits cost management for success

Electronics giant Philips said on Oct. 12 it had tripled its net profit to 176 million euros in the third quarter of 2009, compared to the same period last year.

Sales stood at 5.6 billion euros in the third quarter, down 11% from 6.3 billion euros in the same period last year, but an improvement from the 19% decline in the second quarter.

"Our Q3 results are a reflection of our strong fundamentals and the proactive manner in which we have been managing our costs," Philips CEO Gerard Kleisterlee said.

Most of the company's business divisions saw improvements in sales and earnings compared to the previous quarter, he said.

Philips reported a six-fold increase in earnings before interest, tax and amortization (Ebita) of 344 million euros in the third quarter, from which was subtracted restructuring and acquisition-related charges of 125 million euros and an 87 million euro provision.

"The decisive action we took at the end of 2008 to focus on cost and cash management is increasingly becoming visibile in our performance," said Kleisterlee. "This has led to a set of encouraging results in the third quarter, especially if you look at the year-on-year improvement in earnings and cash flow. I remain confident that Philips will come out of this recession as a stronger company and a leader in our field."

Philips announced in January that it would cut 6,000 jobs worldwide to cope with the global slowdown.

Copyright Agence France-Presse, 2009

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