Philips reports Q1 profit drop on TV unit sales decline
Philips Electronics has reported a 28 per cent drop in first quarter profit after a decline in revenues from its television unit.
The Dutch consumer electronics giant said earnings before interest, tax and amortisation (EBITA) fell to 265 million (£219 million), as operating losses in the television division increased to 95 million (£76 million) compared with 51 million (£40.8 million) for the same period last year.
Philips said it had formed an alliance with Funai in North America to improve the operation of its television unit.
Gerard Kleisterlee, the chief executive of Philips, said: "We look back on a quarter with essentially good financial performance across most of our businesses.
"Unfortunately our results are clouded, more than we like, by the adverse situation in our TV business, significantly lower incidental license income and some acquisition-related charges impacting EBITA."
The company's lighting and healthcare divisions performed better, and Philips said it would focus on these units. Philips added the "solid performance" underscores its robustness in times of "economic headwinds".
The company increased its forecast for growth in earnings before interest, tax and amortisation from ten per cent to 11 per cent.
Shares in Philips fell 2.5 per cent to 23.3 (£18.64) in early trading.