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Philips Q4 CE Sales Decline 19%

2/07/2002 10:08:00 AM Eastern

Amsterdam, The Netherlands - Sales of consumer electronics at Royal Philips Electronics took it on the chin in the fourth quarter, dropping 19 percent, to $2.8 billion, down from $3.5 billion in the year-ago period.

At the same time, average CE prices decreased 12 percent year over year, while unit volume was off 5 percent from the same quarter in 2000.

Mainstream consumer electronics, which makes up the bulk of Philips' consumer electronics segment, dropped 6 percent in the fourth quarter, to $2.3 billion, down from $2.5 billion in the fourth quarter of 2000. Mainstream CE sales in North America dipped 5 percent, compared with the same quarter in 2000, Philips reported.

The CE segment reported an operational loss of $6.1 million in the fourth quarter, compared with income from operations of $89.1 million in the same three months a year ago.

Mainstream CE recorded an operational loss of $32 million in the fourth quarter, down from income from operations of $102.9 million in the fourth quarter of 2000. This current loss reflected the economic slowdown, particularly in North America, said Philips. The mainstream CE loss from operations in the fourth quarter included a special item of negative $6.1 million.

Severely impacted by the worldwide economic downturn in the IT and telecommunications markets over the 12 months, Philips' CE segment saw revenue drop to $9.7 billion, compared with $11.5 billion the previous year. Mainstream CE slid to $7.6 billion for the 12 months, down from $8.2 billion in the year-ago period.

The CE segment reported a $561.4 million operational loss for the 12 months, compared to income from operations of $355.2 million the previous period. Mainstream CE recorded a $216.6 million loss from operations for the year, compared with income from operations of $158.5 million in the same 12 months in 2000.

Overall Philips sales in the fourth quarter dropped 16 percent to $8 billion, down from $9.5 billion in the same quarter in 2000, while the company reported an overall fourth-quarter loss of $989.2 million, compared with a profit of $2.4 billion in the year-ago period. Excluding special items, Philips had a loss of $157.8 million in the fourth quarter, down from a profit of $575.7 million in the same three months in 2000.

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