Philips stock opened 10% down on Monday: explained here
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Apr 25, 2022
CEO Frans van Houten discussed results on CNBC’s “Squawk Box Europe”.
Philips stock opened more than 10% down on results this morning.
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.
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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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