Philips record 23 per cent increase in 3Q profits

Philips record 23 per cent increase in 3Q profits

	Published : Tue, 18 Oct 2005 13:05 By : Paula Demarzio Print this Story

AMSTERDAM: Consumer electronics powerhouse Philips Electronics NV posted a higher third quarter net profit at 1.436 billion euros, a surprising 23 per cent increase over figures for the corresponding previous year quarter.

The company had an extraordinary gain of 1.09 billion euros by way of asset sales during the period, including 635 million euros in non-taxable income from an initial public offering of shares on the Nasdaq of its navigation-systems company Navteq Corp.

The company's overall sales too grew by 5 per cent to 7.63 billion euros, while the operating income slumped to 442 million euros, compared to 1.02 billion euros in quarter 3, 2004. Operating income from chip sales came down by half to 90 million euros while the medical systems division saw the income go down by 5.5 per cent to 155 million euros.

In terms of divisional revenue, consumer electronics unit had a 11 per cent increase at 2.54 billion euros, medical systems business, 9 per cent at 1.53 billion euros and semiconductor unit 2 per cent at 1.19 billion euros.

The company also gained by its sale of holdings in Taiwan Semiconductor Manufacturing Co. Ltd. and flat-panel venture LG.Philips LCD. It had also divested its remaining stakes in Atos Origin SA, France's No. 2 computer-services company, and GN Store Nord A/S, the world's fourth-largest maker of hearing aids.

The company said it hopes to meet profit margins for the whole year. The company's chief executive Gerard Kleisterlee said the company is on track with its financial targets and delivering the commitments.

Kleisterlee had earlier outlined his initiatives in selling assets to free up cash so that he can invest in the medical systems, appliances and lighting units. He has also formalised a plan to complete the purchase of a stake in Lumileds Lighting.