By Sabela Ojea
Koninklijke Philips NV reported on Monday a significant rise in net profit for the third quarter but suffered a decline in sales for the period, which also missed market views.
The Dutch medical-technology group said its results were hit by supply-chain issues, which led to longer lead times to convert its strong order book to revenue during the period.
The company, which now expects to report low-single-digit comparable sales growth with a modest adjusted Ebita margin improvement for the full year, said these supply-chain challenges are expected to continue in the fourth quarter.
Philips posted a net profit from continuing operations of 2.98 billion euros ($3.46 billion) compared with EUR340 million for the same period a year earlier. It was expected to decline to EUR236 million, taken from the company's compiled consensus.
The company's net profit result was mainly driven by the sale of its Domestic Appliances business, it said.
"With this, we concluded our major divestments, allowing us to focus fully on extending our leadership in health technology and continuing our transformation into a solutions company," Chief Executive Frans van Houten said.
Quarterly sales decreased to EUR4.16 billion from EUR4.98 billion for the year earlier period, when they were expected to reach EUR4.18 billion, according to the company's compiled consensus.
Comparable sales fell 7.6%, Philips said.
Adjusted earnings before interest, taxes and amortization margin for the third quarter was 12.3%, the company said.
Write to Sabela Ojea at firstname.lastname@example.org; @sabelaojeaguix
(END) Dow Jones Newswires
October 18, 2021 01:46 ET (05:46 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.