Royal Philips Electronics NV, Europe’s largest maker of consumer electronics, posted a second straight quarterly loss as sales in the consumer and lighting units plunged amid the economic slowdown.
The first-quarter net loss attributable to shareholders of the parent company was €59 million ($79 million), compared with net income of €294 million a year earlier, the Amsterdam-based company said in a statement today.
Chief executive officer Gerard Kleisterlee said on March 27th that Philips experienced a “further weakening” in all markets in the first quarter from the preceding three months and predicted sales will fall this year.
Philips, also the world’s largest maker of light bulbs, said today it aims to cut annual costs by more than €500 million by the end of this year.
“While the effects were felt strongly in our activities that cater to the consumer market and to the construction and automotive industries, our healthcare sales are now impacted as well,” Mr Kleisterlee said in the statement.
“We expect no material change to this situation” this quarter, he said. Sales fell 15 per cent to €5.08 billion, missing the median estimate of €5.19 billion.
Revenue at the consumer lifestyle unit declined 33 per cent to €1.76 billion from a year earlier, while the lighting division’s sales slid 15 per cent to €1.5 billion.
On January 26th, Philips said it would eliminate 6,000 jobs and stop its €5 billion share buyback after reporting its first quarterly loss in almost six years.
Bloomberg