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Wed, Apr 15, 2009 - Page 10 News List

Philips reports 57 million euro net loss for first quarter

AFP , THE HAGUE, NETHERLANDS

Dutch electronics giant Philips yesterday reported a 57 million euro (US$76 million) net loss for the first quarter of the year and warned the economic crisis would further hurt business in the months ahead.

The loss was accompanied by a 17 percent decline in sales to 5.1 billion euros. Philips saw net profit of 294 million euros during the same period last year.

The results correspond to forecasts from eight analysts questioned by Dow Jones Newswires who predicted a figure between a net loss of 98 million euros and a net profit of 28 million euros.

“In the first quarter of 2009 we have seen a significant further deterioration of our markets,” CEO Gerard Kleisterlee said in a statement.

“While the effects were felt most strongly in our activities that cater to the consumer market and to the construction and automotive industries, our healthcare sales are now impacted as well. We expect no material change to this situation in quarter two,” he said.

A cost-reduction program launched last year that includes cutting 6,000 jobs will allow the company to save 500 million euros at year’s end instead of 400 million as previously reported, Kleisterlee said.

It reported a loss before interest, tax and amortization (EBITA) of 74 million euros compared to a profit of 265 million euros in the first quarter of last year.

The Amsterdam-based company said that it had 5,126 fewer jobs in the first quarter than the previous one because of both structural changes and seasonal reductions.

The company’s sales slide has come with the global economic crisis taking a heavy toll on demand.

Its medical unit sales were down two percent, the company said, while consumer electronic sales dropped 25 percent to 1.8 billion euros.

Lighting division sales fell 19 percent to 1.5 billion euros.

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