Philips returns to sales growth in its first quarter

Philips, the lighting, consumer and healthcare products company, said on Tuesday its comparable sales rose 2 per cent to €5.3 billion in the first quarter.

The company said its operational result, or adjusted earnings before interest, taxes and amortisation, rose to €327 million in the first quarter from €304 million in the same period a year earlier.

Analysts polled by Reuters had put the EBITA figure at €324 million.

Chief executive Frans van Houten said he was “encouraged” by the company’s return to sales growth in the first quarter after a fall in the fourth quarter of 2014.

The company is now forecasting a “modest” increase in comparable sales for the full year 2015. It said it is still running about 1 per cent behind its medium-term target of reaching an operating margin of at least 11 per cent of sales in 2016, as stated in a January warning.

At Philips’ healthcare division, which suffered from a lengthy production shutdown in the United States in 2014, the company said on Tuesday order intake and sales grew. However, operating profit was just €17 million, from €109 million in the same period in 2014.

Philips’ shares are up 14.5 per cent so far in 2015, compared to a 20 per cent rise in the benchmark AEX index of blue chip Dutch shares.

Reuters