Koninklijke Philips NV stock (AMS: PHIA) is down more than 10% on Monday after the health-technology company reported a net loss for its fiscal first quarter.
Notable figures in Philips Q1 earnings report
Lost €151 million ($162 million) versus the year-ago figure of €39 million profit.Sales were up 2.5% to €3.92 billion, ahead of Wall Street estimates.Comparable sales sunk 4.0%, much less than 7.8% Philips had forecast.Adjusted EBITA of €243 million was down 33% YoY, but better than expected.
According to the Dutch multinational, it’s resorting to price increase to offset inflationary pressures.
Highlights from CEO’s interview on CNBC
Philips cited strong demand as it reiterated its guidance for 3.0% to 5.0% growth in comparable sales this year. On CNBC’s “Squawk Box Europe”, CEO Frans van Houten said:
We see continued demand from hospitals and consumers. We saw 5.0% order growth in Q1 that brings our order book higher 30% YoY. Consumer demand was also strong. Oral care was up double-digit and personal health business grew 8.0%.
The chief executive, however, agreed that supply chain constraints continue to be a headwind. The COVID situation in China poses another risk for the future, he added. Philips shares have cut in half in the trailing twelve months – a sharp decline that the CEO Houten attributes to the company’s sleep and respiratory care business. He noted:
95% of Philips is performing well. But analysts and shareholders are focused on the big recall in our sleep and respiratory area that reflects about 5.0% of the company. It’ll take us the whole year to complete this recall. That’s what’s putting pressure on the share price.
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