Philips expecting a profitable summer amid receding supply chain woes

Author : Pankaj Singh | Published Date : 2022-01-25 

Dutch multinational health tech corporation, Philips announced that it is banking on a strong recovery of its sales volumes during the second half of the year, despite acceding to a sharp decline caused by the global shortage of parts in the upcoming months.

Earlier in January, Phillips had warned that supply chain issues would result in a drop in profits, after which it had to expand a ventilator recall. This chain of events sent its shares spiraling over 15%, making it the company’s worst day on stock markets in decades.

Philips’ CEO Frans van Houten was quoted saying that the company will start the year on a low note, with a substantial sales decline, but this will be followed by a recovery, consequently resulting in a strong upward trend during the second half of 2022.

He further stated that Phillips should see a 3-5% growth in same-store sales in 2022, with a 40-90 basis points increase in the EBITA (adjusted earnings before interest, tax, and amortization) margin.

However, the company’s overall growth will be limited on account of the sleep & respiratory care department, which is dealing with an enormous recall of breathing-aid machines that were launched in 2021, amid fears that the foam installed in the devices could become toxic as it degrades.

Excluding costs from the sleep & respiratory care department,  growth is expected to be between 5% to 6% this year, Van Houten claimed.

Notably, Philips has set aside USD 820.41 million for repairing and replacing 5 million devices across the world, but this sum does not cover costs of litigation, as the company currently faces over a hundred class action suits.

As per provisional records released in January, the company’s comparable sales fell by 10% during the last quarter of 2021, while adjusted EBITA plunged 35% to USD 731 million.

Source Credits –


About Author

Pankaj Singh

Pankaj Singh

Endowed with a post graduate degree in management and finance, Pankaj Singh has been a part of the online content domain for quite a while. Having worked previously as a U.K. insurance underwriter for two years, he now writes articles for fractovia.org and other online portals. He can be contacted at- [email protected] | https://twitter.com/PankajSingh2605

Related News

Mexico’s Nowports tops USD 1.1 Bn valuation after Softbank-led funding

Published Date: 2022-05-26         Author: Pankaj Singh

Mexico-based logistics startup Nowports has reportedly attained Unicorn status after securing USD 150 million in a Series C funding round that was spearheaded by SoftBank’s Latin America fund. The latest fundraising took the company’s valuation to USD 1.1 billion. The round also saw p... Read More

Zoom increases full-year profit forecast over strong enterprise demand

Published Date: 2022-05-25         Author: Pankaj Singh

Zoom Video Communications has reportedly increased its full-year adjusted profit prediction on account of strong demand from large organizations in a hybrid workplace. Zoom’s shares witnessed a 15% hike in extended trading following the recent development. The company claims that the return... Read More

Wakefit reports USD 82 million in revenues, marking a 50% y-o-y growth

Published Date: 2022-05-24         Author: Pankaj Singh

For the financial year ending March 2022, the sleep solutions startup Wakefit reported revenue of nearly USD 82 million, which is a 50% increase from the previous year. It aims to reach a revenue of approximately USD 128 million in the next fiscal year. The company's revenue growth was mainly... Read More

© 2022 Fractovia. All Rights Reserved