Jan 25, 2017: LED lighting giant Philips said its bottom-line profit more than doubled in 2016, driven by the flotation of its lighting business and the strong performance of its health technology division.
Philips’ net profit rose by 126% to 1.49 billion euros ($1.6 billion) in 2016, and its sales increased by 1% to 24.5 billion euros.
“Overall, 2016 was a defining year,” said Frans van Houten, chief executive, Philips, mentioning the listing of Philips Lighting and deals to sell Lumileds and automotive businesses.
Although Philips is a leading manufacture of lightbulbs, electrical appliances and television sets, it has stopped thse businesses due to fierce competition from Asia. Instead, it focuses on health technology like computer tomography and molecular imaging, and household appliances like electrical toothbrushes and kitchen equipment. Philips intends to sell off its lighting division completely. Now it holds a stake of 71.23%.
In December 2016, Philips sold 80.1% stake in its Lumileds LED lighting business to Apollo Global Management for $1.5 billion.
In the fourth quarter 2016, Philips gained net profit of 640 million euros, compared with a loss of 39 million euros in 2015. Its fourth-quarter sales increased by 2% to 7.24 billion euros, driven by higher revenues in the health tech division.