Philips stock rises despite dismal Q4 results
Tuesday, 27 January 2009, 14:58 IST
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Amsterdam: Shares of Royal Philips Electronics rose by 8.25 percent Monday, despite its publication of disappointing fourth quarter results. At closing time Monday, Philips stock was trading at 13.645 euros ($17.72) per share. Earlier Monday the Eindhoven-based electronics giant said it had suffered a net loss of 1.5 billion euros ($1.94 billion) in the fourth quarter of last year, resulting in a net loss of 176 million euros for 2008. In 2007, Philips posted a net profit of 4.16 billion euros. Commenting on the 2008 company results, board chairman Gerard Kleisterlee said Philips would cut some 6,000 jobs globally to save 400 million euros, starting in the second half of 2009. Speaking on Dutch television, a Philips spokesperson said it was not clear yet how many jobs would be lost in the Netherlands. The cutbacks will affect all three Philips divisions - Consumer Lifestyle, Lighting and Healthcare. Philips' pre-tax earnings in the fourth quarter of 2008 dropped from 871 to 141 million euros, partly caused by 390 million euros in reorganisation expenses. Turnover for the last quarter of 2008 amounted to 7.6 billion euros, compared with 8.7 billion euros the previous year. The consumer market division was mainly responsible for the drop; Philips' other divisions still posted a growth. Turnover for 2008 dropped slightly from 26.8 to 26.4 billion euros. Despite the loss, Philips said it would give its shareholders 0.70 euros per share in dividend. An ongoing share purchase of 5 billion euros, however, was being stopped. The company said it suffered substantially from the economic crisis in the final months of 2008. "We are experiencing one of the worst economic fallbacks in recent history," Kleisterlee said. Philips expects the market to worsen in the first months of 2009. The company said that under the current economic circumstances it was impossible to make any long-term predictions. Kleisterlee added he is convinced Philips can cope with the economic fallback.
Source: IANS
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