By Matthew Henry
AMSTERDAM: Philips has reported an eight per cent rise in fourth quarter earnings to 8,365 million Euros ($AU14.02 billion), buoyed by selling its stake in the LG.Philips flat panel business and sales growth in emerging markets.
Net income reached 1,393 million Euros ($AU2.33 billion) but with a large component (1,087 million Euros) coming from the sale of its stake in LG.Philips LCD and TMSC.
"I am pleased to report that in the fourth quarter Philips once again delivered on its targets,” said Royal Philips Electronics president and chief executive, Gerard Kleisterlee, in a public release to shareholders.
“Q4’s eight percent comparable sales growth and 10.3 per cent EBITA margin brought our full-year numbers to five per cent for growth and 7.7 per cent for EBITA, meeting, respectively exceeding, our targets for the year thereby sustaining our track record of ‘saying what we do and doing what we say’.”
Kleisterlee said the company was now well on track to meeting its targest set out in its Vision 2010 strategy.
Philips continued its investment in emerging markets across Asia, Eastern Europe and South America in 2007, which delivered a boost to the bottom line.
The company experienced 20 per cent growth in China and India during the fourth quarter and 18 per cent across all emerging markets.
Philips’ consumer electronics division, which has been battling with falling margins in the global television business, recently announced it would seek to transcend the price war with design-oriented products such as its new Design Collection audiovisual range and Aurea LCD televisions.
According to Reuters, Kleisterlee said yesterday the company would be more selective in choosing its distribution partners to focus on high-margin markets.
Philips Electronics Australia has already pursued a selective distribution model in Australia for a number of years.