Philips Swings to Profit as Sales Rise -- Update

By Maarten van Tartwijk 

AMSTERDAM--Royal Philips NV returned to a net profit in the fourth quarter as the Dutch health-technology and consumer-products maker reported a pickup in sales but said it sees "elevated uncertainty" in its markets.

The company also said it is in talks with the U.S. Department of Justice on a civil matter following inspections of its external-defibrillator business by the Food and Drug Administration that it said could have a "meaningful impact on the operations of this business." It didn't elaborate.

Philips, the maker of products ranging from X-ray machines to electric toothbrushes, said net profit was EUR640 million ($688 million) in the last three months of 2016, up from a EUR39 million net loss in the same period a year earlier. Adjusted earnings before interest, taxes and amortization were EUR1 billion, up from EUR842 million in the previous year. Sales were EUR7.24 billion, up 3% on a comparable basis.

The Dutch company, which is in the process of exiting its lighting business, also presented new financial targets for the next three to four years despite voicing concerns about its markets. Its new goal is to achieve 4% to 6% comparable sales growth, while growing adjusted Ebita by 100 basis points annually.

Philips also said it is in talks with the U.S. Department of Justice on a civil matter following inspections of its defibrillator business by the Food and Drug Administration. The company didn't provide further detail but warned that it is anticipating a "meaningful impact on the operations of this business."

Write to Maarten van Tartwijk at [e-mail]

(END) Dow Jones Newswires

January 24, 2017 02:13 ET (07:13 GMT)

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