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Philips racks up more than $4 billion in first quarter sales

by John R. Fischer, Senior Reporter | April 27, 2018
Business Affairs

The suspension cost the company a little more than $24 million (€20 million) though Klink says that Philips already made financial markets aware of this loss and that despite the minimal impact, it has not deterred the company from its objective to increase sales growth by four to six percent and reach an average profitability improvement of one percent in the 2017-2020 period.

“Ultrasound and image-guided therapy were already strong businesses with good growth and good profitability,” he said. “We have been working hard on the turnaround on diagnostic imaging, and we feel we’re on the right path forward. We now need to further continue on that improvement path.”

Philips also completed this week the transaction of the redemption of the outstanding 3.750 percent Notes due in 2022, which it started last month with an aggregate principal amount of $1 billion to reduce interest expenses and extend maturities. This produced a charge of more than $35 million (€29 million), as recorded in the income statement.

Cash outflow is expected to be more than $1 billion (€840 million), excluding accrued interest, in the second quarter of 2018.

Philips continues to work in close consultation with the FDA concerning the consent decree and is targeting an annual savings of more than $480 million (€400 million) in 2018.

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