Philips slightly raises 2023 outlook after Q2 core profit beat

Philips slightly raises 2023 outlook after Q2 core profit beat

(Reuters) -Dutch health technology company Philips on Monday slightly raised its full-year targets after posting a bigger-than-expected jump in second-quarter core earnings thanks to better supply chains, a strong order book and efficiency measures.

The Amsterdam-based group, a former industrial conglomerate that now focuses on medical technology, reported adjusted earnings before interest, taxes and amortization (EBITA) of 453 million euros ($503.78 million) for the April-June period, above the 394 million euros seen in a company-compiled poll.

For the full year, it now expects a mid-single-digit comparable sales growth versus its previous guidance of a low-single-digit growth.

Its adjusted EBITA margin is now seen at the upper end of its previously forecasted high-single-digit range.

Philips, which is facing lawsuits over its recall of respiratory devices, said it had produced approximately 99% of the new replacement respiratory devices and repair kits required for the remediation of the registered affected devices.

The group has been grappling with the fallout of a global recall of millions of respirators used to treat sleep apnoea since it was announced in June 2021.

“Completing the Philips Respironics field action remains our highest priority. The vast majority of the sleep therapy devices are now with patients and home care providers, and we are fully focused on the remediation of the affected ventilators,” Chief Executive Roy Jakobs said in a statement.

The Amsterdam-based group also said litigation and investigation by the US Department of Justice related to the Respironics field action were ongoing, as well as the discussions on a proposed consent decree.

($1 = 0.8992 euros)

(Reporting by Kirsti Knolle)