Philips Reports Profits Overall, And CE For Q4
By Steve Smith -- TWICE, 1/29/2007
AMSTERDAM, THE NETHERLANDS — Royal Philips Electronics reported a fourth-quarter net profit that was up by 2 percent, which doubled the previous year's figure.
In consumer electronics, Philips reported slightly lower sales for the quarter, at $4.23 billion, down from $4.9 billion worldwide last year. But the category's operating profit before interest and taxes (EBIT) was $335.7 million, up from $303.3 million during the previous year's fourth quarter.
Gerard Kleisterlee, president/CEO, commented, "Our consumer electronics division was able to post a full-year EBIT margin of 3.9 percent, amid tough market conditions. This again shows the robustness of our CE model."
For North America in all categories, Philips reported that sales were $3.02 billion, up from the prior year's fourth-quarter's $2.29 billion. North America was the second-highest sales region for consumer electronics, with 23 percent of the company's $4.23 billion in sales during the fourth quarter.
Philips expects the first quarter to be "challenging" due to continuing pressure on margins as supply of flat TVs outstrips market demand. But helped by the introduction of a new range of Ambilight televisions, the division expects to achieve an EBITA (net profit after interest and taxes) of about 3 percent in 2007.
The transfer of Philips' remaining Mobile Phones activities to China Electronics was originally planned for Q4 2006 and is still subject to finalization.
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