Royal Philips Electronics NV said yesterday its second quarter profits fell by more than half, despite resilient sales in a battered global economy.
The world’s largest maker of lighting said its net income was 720 million euros (US$1.14 billion), down from 1.57 billion euros in the same quarter last year.
Sales rose 6 percent to 6.46 billion euros, driven by sales of lighting and televisions in emerging markets that were boosted by viewer interest in the Euro2008 football championship.
Sales beat analysts’ expectations of 6.35 billion euros.
Chief executive Gerald Kleisterlee said in a statement that sales showed “the quality and the resilience of our overall business portfolio in a rapidly deteriorating macro-economic environment.”
Philips attributed a 440 million euro drop in net income reflecting last year’s gains from the disinvestment in Taiwan Semiconductor Manufacturing Co Ltd (台積電) and a 299 million euros impairment charge for NXP semiconductors.
Philips’ share price rose 6.2 percent to 20.64 euros shortly after trading opened on the Euronext exchange. The price has dropped more than 30 percent since the start of the year.
Sales of lighting and TVs were particularly strong in Latin America, Eastern Europe and India, pushing emerging market sales up by 16 percent, chief financial officer Pierre-Jean Sivignon said.
An uptick in TV sales was welcome news coming after a disappointing first quarter and falling prices and Sivignon said the Consumer Lifestyle division performed well as a whole.
He said Philips had met its target to clear some of its inventory to make way for new products.
Lighting was up 6 percent, with a 16 percent increase in energy saving systems, though sales softened in North America and Europe, he said. The Healthcare division posted 3 percent growth, and Sivignon said a full order book indicated a strong second half for the year.
Sivignon said he expected few acquisitions for the rest of the year.
“We might do a few small things and we continue to look for opportunities,” he said.
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