Philips grows sales, profit in medical unit

Dutch electronics conglomerate Royal Philips Electronics saw revenues and operating profit grow at its Philips Medical Systems division in the second quarter.

For the period, the Andover, MA-based division reported revenues of 1.63 billion euros ($2.04 billion), compared with $1.498 billion euros ($1.87 billion) in the corresponding quarter the previous year, representing growth of 9% both before and after taking account of currency fluctuations. The division posted earnings before interest and taxes (EBIT) of 199 million euros ($249 million), up 27% compared to EBIT of 157 million euros ($196 million) in the second quarter of 2005.

In quarterly highlights, Philips pointed to the company's pending acquisition of MRI magnet supplier Intermagnetics General of Latham, MA; the sale of 16 iSite PACS contracts; and the opening of a major training facility for healthcare professionals and customers in Singapore.

The company said that sales growth occurred in almost all its business lines, with doublet-digit growth in CT, nuclear medicine (especially PET/CT), and x-ray (particularly flat-panel digital cardiovascular imaging systems). All regions contributed to the growth, though the Asia-Pacific zone stood out with 19% growth.

Orders grew 2% at comparable exchange rates, with growth in MRI partially offset by declines in nuclear medicine and monitoring systems. Orders for healthcare informatics systems grew strongly thanks to iSite PACS orders. The company said it expects that EBIT margin in the medical division in the second half of 2006 will show an improvement compared with 2005.

By AuntMinnie.com staff writers
July 18, 2006

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