July 23, 2018 -- Philips reports Q2 sales of EUR 4.3 billion, with 4% comparable sales growth; net income from continuing operations was EUR 186 million, and Adjusted EBITA margin increased 100 basis points to 11.2%
Second-quarter highlights
• Sales in the quarter were EUR 4.3 billion, with comparable sales growth of 4%
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• Comparable order intake increased 9% compared to Q2 2017
• Net income from continuing operations was EUR 186 million, compared to EUR 161 million in Q2 2017
• Adjusted EBITA margin improved by 100 basis points to 11.2% of sales, compared to 10.2% of sales in Q2 2017
• Income from operations (EBIT) increased to EUR 298 million, compared to EUR 252 million in Q2 2017
• Operating cash flow totaled EUR 130 million, compared to EUR 73 million in Q2 2017
Frans van Houten, CEO:
“In the second quarter, we delivered 4% comparable sales growth, a strong 9% order intake growth and a solid 100 basis points improvement in operational performance driven by our growth and productivity programs.
I am pleased with the continued strong performance improvement of the Diagnosis & Treatment businesses, driven by the breadth of our innovative product portfolio, which resulted in 8% comparable sales growth and double-digit order intake growth. At the same time, I am encouraged by the mid-single-digit order intake growth of the Connected Care & Health Informatics businesses. After a slow start, the Personal Health businesses gained momentum in the quarter, and we expect this to continue in the second half of the year.
Demonstrating our ongoing success in building our solutions business, we signed seven long-term strategic partnership agreements in the quarter. In Germany, Philips announced two multi-year agreements with Clinics of Cologne and Munich Municipal Hospital to deliver medical imaging solutions to support precision diagnosis and therapy, innovation and productivity improvements. We also signed a seven-year agreement with the governments of the Netherlands and Ethiopia to design, build and equip Ethiopia’s first specialized Cardiac Care Center for state-of-the-art diagnosis and treatment of cardiac diseases.
Looking ahead, we reiterate our targets for the 2017–2020 period of 4-6% comparable sales growth and an average annual 100 basis points improvement in Adjusted EBITA margin.”
Business segments
The Diagnosis & Treatment businesses recorded a double-digit increase in comparable order intake, driven by strong double-digit growth in China and North America. Comparable sales increased by 8%, with double-digit growth in Image-Guided Therapy and high-single-digit growth in Ultrasound. The Adjusted EBITA margin was 180 basis points higher than in the same period last year, mainly due to growth and operational improvements.
