By Royal Philips, the Dutch health-technology company, has reported a net profit for the third quarter of the year and has raised its full-year guidance due to higher sales across all segments and geographies. The company now expects a 6% to 7% rise in comparable sales for the year, compared to its previous mid-single-digit growth projection. Additionally, adjusted earnings before interest, taxes, and amortization margin is expected to be at 10% to 11%, reflecting an upgrade from its initial high-single-digit range for 2023.
During the third quarter, net profit attributable to shareholders reached €88 million ($107.1 million). This is a significant improvement from a loss of €1.33 billion during the same period last year and surpasses the company-compiled consensus profit of €82 million. Sales for the quarter rose to €4.47 billion, a growth of 11% compared to the previous year.
The diagnosis & treatment and connected care segments experienced double-digit growth, while the personal health segment achieved high-single-digit growth. Adjusted earnings before interest, taxes, and amortization reached €457 million compared to €209 million last year. Margin for earnings before interest, taxes, and amortization (Ebita) rose to 10.2% from 4.8%, primarily driven by increased sales, pricing strategies, and productivity measures.
Philips stated that its restructuring and productivity plans are on track, resulting in total savings of €258 million for the quarter. Chief Executive Roy Jakobs attributed the improved operational performance to the company’s focus on enhancing patient safety and quality, improving the supply chain reliability, and establishing a simplified operating model.
While Philips remains committed to completing the recall of Philips Respironics products, Jakobs reiterated that patient safety is of utmost importance to the company. The remediation process for sleep-therapy devices is nearly complete, while efforts to address issues with ventilators are ongoing.
In summary, Philips’ strong performance in the third quarter has led to an optimistic outlook for the full year. With robust sales growth across all segments and geographies, the company is well-positioned for further success.
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