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Philips CE Sales Rise 11%

1/23/2006 08:45:00 AM Eastern

Amsterdam, The Netherlands — Driven by growing sales of connected displays, mainly flat-screen televisions, fourth-quarter revenue in the consumer electronics business at Philips Electronics jumped 11 percent, hitting $4.2 billion, up from $4.1 billion year-over-year.

In North America, comparable sales were up 9 percent, driven largely by consumer electronics, said Philips.

Excluding optical licenses, income from operations in the company’s CE business improved $142 million, due to better operational performance, lower restructuring charges and ongoing benefits from the company’s business renewal program. Restructuring charges in the quarter totaled $21.9 million, $74 million lower than in the last three months of 2004.

Including optical licenses, income from operations in the CE segment slipped to $284.1 million in the quarter ended Dec. 31, compared with $327.8 million in the same period the prior year.

For the year, CE segment sales moved up to $12.7 billion from a year-ago $12 billion. Income from operations for the 12 months soared to $614.2 million, up from $449.2 million in the prior year.

“On the back of a strong product lineup, we accelerated growth and increased profitability,” said Gerard Kleisterlee, president/CEO. “We gained some good momentum this year, and are confident of meeting our targets.”

Consolidated Philips revenue in the fourth quarter rose by 6 percent, coming in at $11.6 billion, up from $10.9 billion in the same quarter in 2004.

Consolidated income from continuing operations decreased to $472.2 million in the fourth quarter, down from a year-earlier $605.8 million. Net income was $403 million in the year’s last three months, compared with $604.5 year-on-year. A strong increase in income from operations was offset by lower results from charges and higher income taxes, said Philips.

For the 12 months, consolidated revenue increased 4 percent, hitting $36.9 billion, up from $35.6 billion in the previous year. Net income was flat, edging upward to $3.48 billion, compared with a year-ago $3.44 billion.

Along with flat-panel TVs, Philips cited chips for cellphones and shavers as the products most responsible for its improved fourth-quarter business.

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