Philips offers update on its financial efficiency in Q4 2021

Writer of the article:

January 12, 2022

Amsterdam, the Netherlands – Royal Philips (NYSE: PHG, AEX: PHIA), a global leader in successfully being technology, nowadays equipped an update on the fourth-quarter 2021 and fat-year 2021 financial outcomes.

Neighborhood gross sales for the quarter are expected to be approximately EUR 4.9 billion, which is spherical EUR 350 million lower than Philips’ earlier expectations. Right here’s mainly due to this of intensified global provide chain shortages (essentially connected to digital parts and freight skill), moreover the postponement of buyer tools installations. The similar gross sales [1] decline modified into approximately 10%, mainly due to this of these outcomes and the affect of the sooner presented Philips Respironics grab .Neighborhood Adjusted EBITA [2] for the quarter is expected to be approximately EUR 650 million, which is approximately 13% of gross sales, impacted by the decline in gross sales and greater provide charges.

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Which skill, Neighborhood gross sales for the fat year 2021 are truly expected to be approximately EUR 17.2 billion, leading to an expected Neighborhood similar gross sales decline of approximately 1% for the year. The provide chain headwinds blended with the affect connected to the Philips Respironics grabamounted to an affect of approximately 5 percentage capabilities on the Neighborhood’s fat year similar gross sales. Neighborhood Adjusted EBITA for the fat year is expected to be spherical EUR 2.1 billion, or approximately 12% of gross sales.

Neighborhood similar elaborate intake suppose within the fourth quarter has remained great with 4% suppose pushed by double-digit-suppose within the Prognosis & Medicine businesses, leading to 4% suppose for the fat year 2021. This extra builds on the high-single-digit similar elaborate intake suppose in Q4 2020 and fat-year 2020.

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“We continue to peep gorgeous ask for our progressive products and solutions, leading to an all-time high elaborate e book,” said Frans van Houten, CEO of Royal Philips. “However, we confronted seriously intensified global provide chain factors across our businesses, moreover buyer postponement of tools installations in hospitals. We’re carefully working with suppliers and governments to handle the shortages within the healthcare provide chain and make obvious that they acknowledge the importance of prioritizing lifestyles-saving clinical tools.”

Neighborhood restructuring, acquisition-connected and other costs within the fourth quarter are expected to quantity to EUR 420 million, which is EUR 315 million above the beforehand guided costs due to this of a extra expand of the discipline motion provision connected to the voluntary Philips Respironics grab notification(gape underneath) and a provision for quality actions and other matters within the Related Care businesses.

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Replace on voluntary Philips Respironics grab notification *

Philips Respironics is rising the discipline motion provision by spherical EUR 225 million, mainly due to this of the upper volume of devices now requiring remediation and elevated provide charges. Philips Respironics expanded the scope to particular older devices within the curiosity of patients and in alignment with the connected competent authorities and now expects to remediate a total of approximately 5.2 million registered devices globally.

“Affected person successfully-being is on the coronary heart of all the pieces we assemble at Philips, and we map to score a technique to patients as mercurial as that you would possibly presumably well presumably presumably take into accounts,” said Frans van Houten. “To this level, Philips Respironics has produced a total of approximately 1.5 million restore kits and replacement devices, of which approximately 700,000 maintain reached customers. I’m furthermore encouraged by the ghastly VOC take a look at outcomes to this level for the important-generation DreamStation devices, which we printed in December 2021 [3].”

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Philips will focus on nowadays’s announcement in a convention name from 09.00 to 09: 30 am CET, January 12, 2022. The fourth-quarter and fat-year 2021 financial outcomes will be reported on January 24, 2022.

*       Clutch notification within the US/discipline security survey outdoors the US.

[1]     Similar gross sales exclude the enact of currency movements and acquisitions and divestments (adjustments in consolidation). Philips believes that similar gross sales records enhances working out of gross sales efficiency.

[2]     Adjusted EBITA is outlined as Earnings from operations (EBIT) with the exception of amortization of obtained intangible property, impairment of goodwill and other intangible property, restructuring costs, acquisition-connected charges and other one-time costs and positive aspects.

[3]   Philips Respironics true to assemble gorgeous development with the excellent take a look at and compare program to better assess and scope possible patient successfully being dangers connected to that you would possibly presumably well presumably presumably take into accounts emission of particulates from degraded foam and particular unstable organic compounds (VOCs). In December 2021, Philips equipped an update on the ghastly VOC take a look at outcomes to this level for the important-generation DreamStation devices. The important-generation DreamStation devices picture nearly all of the registered affected devices. Extra trying out is ongoing.

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For extra records, please contact:

Steve Klink

Philips Global Press Living of labor

Tel.: +31 6 10888824

Electronic mail: [email protected]

Derya Guzel

Philips Investor Family

Tel.: +31 20 59 77055

Electronic mail: [email protected]

About Royal Philips

Royal Philips (NYSE: PHG, AEX: PHIA) is a leading successfully being technology firm centered on bettering people’s successfully being and successfully-being, and enabling better outcomes across the successfully being continuum – from healthy residing and prevention, to prognosis, therapy and house care. Philips leverages developed technology and deep clinical and person insights to command integrated solutions. Headquartered within the Netherlands, the firm is a pacesetter in diagnostic imaging, image-guided therapy, patient monitoring and successfully being informatics, moreover in person successfully being and house care. Philips generated 2020 gross sales of EUR 17.3 billion and employs approximately 78,000 workers with gross sales and services and products in greater than 100 countries. News about Philips would possibly be learned at www.philips.com/newscenter .

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Ahead-taking a peep statements

This release contains particular forward-taking a peep statements with admire to the financial condition, outcomes of operations and commerce of Philips and particular of the plans and targets of Philips with admire to these items. Examples of forward-taking a peep statements consist of statements made referring to the approach, estimates of gross sales suppose, future EBITA, future developments in Philips’ organic commerce and the completion of acquisitions and divestments. By their nature, these statements possess possibility and uncertainty because they teach to future events and conditions and there are a total bunch factors that can presumably well presumably motive true outcomes and developments to fluctuate materially from those expressed or implied by these statements.

This press release contains interior records interior the which design of Article 7(1) of the EU Market Abuse Legislation.

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