(Adds details; forecast for stronger sales in second half)
AMSTERDAM, April 24 Philips, the maker
of medical devices and healthcare products, beat expectations on
Monday with an 18 percent rise in first-quarter core earnings to
442 million euros ($480 million) despite weak sales growth.
That topped the 427 million euros in adjusted earnings
before interest, taxes, and amortisation (EBITA) expected by
analysts polled for Reuters and the 374 million euros it earned
a year earlier.
Sales on a like-for-like basis rose 2 percent to 5.7 billion
euros. Sale rose by three percent at Philips' healthcare-linked
businesses, below Philips' medium-term guidance for 4-6 percent
sales growth annually.
Philips expects to gradually sell down its 54 percent stake
in Philips Lighting , which on Friday reported
falling sales and rising profits.
"Our outlook for 2017 remains unchanged as we expect further
operational improvements and comparable sales growth in the year
to be back-end loaded,” said CEO Fran van Houten.
Philips attributed the improvement in margins to cost
savings on overhead and procurement.
Sales growth came mostly from emerging markets, but the
company said order intake was strongest in Western Europe.
Among its three divisions, the company reported 5 percent
growth at its personal health arm, which sells consumer products
including toothbrushes as well as machines to relieve sleep
Its diagnosis & treatment division, which sells high-end
medical scanners and imaging tools used during surgery, saw
sales rise by 2 percent.
Its connected care and informatics business, which includes
patient monitoring systems and software used by hospitals to
gather and analyse data, reported a 1 percent rise in sales.
($1 = 0.9210 euros)
(Reporting by Toby Sterling; editing by Muralikumar
Anantharaman and Jason Neely)