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13 September 2011

Philips announces deeper cuts


Frans van Houten

Philips said today that it is looking to cut costs by Euro 800 million (around £692m) by 2013 – Euro 300m more than previously announced.

However, the company said it was committed to stepping up additional investments in research and development and customer-facing resources of around Euro 200m a year.

“I am glad to see continued growth in our core businesses in Healthcare, Consumer Lifestyle, and the LED segment of Lighting, with strong positions in both growth and mature geographies,” said chief executive Frans van Houten (pictured).

“We will continue to expand our market leadership through increased innovation efforts and customer intimacy, while removing complexity and changing our culture to transform Philips into a more entrepreneurial company,” he added.

“As a result of our efforts and despite economic challenges, we are confident that we can deliver on our 2013 financial targets of 4-6 per cent sales growth, 10-12 per cent  EBITA [earnings before interest, taxes, depreciation and amortisation], and 12-14 ROIC [return on invested capital], as announced in July 2011.”