Philips’ third-quarter performance was hampered by operational as well as supply issues; the company is taking immediate steps to improve performance.
Highlights
- According to the October 12, 2022 update, group sales were EUR 4.3 billion, with a 5% decline in comparable sales.
- Comparable order intake fell 6% after increasing 47% in Q3 2021.
- Operating income was EUR 1.5 billion lower, owing primarily to the previously announced EUR 1.5 billion non-cash goodwill as well as R&D impairment, likened to EUR 358 million in Q3 2021.
- In Q3 2021, adjusted EBITA was EUR 209 million, or 4.8% of sales, likened to EUR 512 million, or 12.3% of sales.
- Instantaneous restructuring activities have been initiated, with charges of approximately EUR 300 million anticipated in the forthcoming quarters.
- Cash flow from operations was a EUR 180 million outflow versus an inflow of EUR 256 million in quarter 3 2021.
Royal Philips CEO Roy Jakobs:
“I am privileged to be given the opportunity to lead Philips, a great company with a strong brand, a leading product portfolio, a strong customer base, and talented employees.” However, we face numerous challenges, as evidenced by our Q3 2022 performance. Although Philips’ strategy and solutions are well received by our stakeholders, we have fallen short of their expectations in recent years.
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