Philips 3Q Sales Missed Market Views, Lowers Fiscal Year Guidance -- 2nd Update
October 18 2021 - 4:25AM
Dow Jones News
By Sabela Ojea
Koninklijke Philips NV reported on Monday a rise in net profit
for the third quarter but sales declined and it lowered its
full-year growth and margin guidance.
The Dutch medical-technology group said its results were hit by
supply-chain issues, which led to longer lead times to convert its
strong order book to revenue during the period. It expects the
problems to continue in the fourth quarter.
Philips downgraded its full-year guidance to low single-digit
growth from low-mid-single digit growth. It also said it now
expects a "modest improvement" in margin, from an estimated 60
basis-points improvement previously, according to analysts.
Philips posted a net profit from continuing operations of 2.98
billion euros ($3.46 billion) compared with EUR340 million for the
same period a year earlier. The company's net profit result was
mainly driven by the sale of its Domestic Appliances business, it
said.
"With this, we concluded our major divestments, allowing us to
focus fully on extending our leadership in health technology and
continuing our transformation into a solutions company," Chief
Executive Frans van Houten said.
Quarterly sales decreased to EUR4.16 billion from EUR4.98
billion for the year earlier period, when they were expected to
reach EUR4.18 billion, according to the company's compiled
consensus. Comparable sales fell 7.6%, Philips said.
Adjusted earnings before interest, taxes, and amortization came
to EUR512 million, down from EUR684 million the prior year. The
adjusted EBITA margin for the third quarter was 12.3%, compared
with 15.5% the prior year.
Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix
(END) Dow Jones Newswires
October 18, 2021 04:10 ET (08:10 GMT)
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