Philips reports profit, revenue drop in Q1

Philips suffered a decline of profit and revenue in the first quarter of 2014, the Dutch electronics giant announced on Tuesday. Exchange rates and market headwinds in several markets, such as China and Russia, put the sales and profit under pressure, according to Philips. Net profit amounted to 137 million euros (189 million U.S. dollars) in the first three months of 2014, down 15 percent from 162 million in Q1 of 2013. The company's earnings before the deduction of interest, tax and amortization expenses (EBITA) was 314 million euros in the first quarter, compared to 402 million euros in the same period last year. Excluding restructuring and acquisition-related charges, EBITA amounted to 368 million euros. "Our first-quarter financial results reflect a challenging start to the year," said Philips CEO Frans van Houten. He said significant currency impact, market headwinds in, among others, China and Russia, and the business impact of the voluntary suspension at our healthcare production facility in Cleveland, resulted in flat comparable sales growth and a decline in EBITA. "We recorded a lower level of profitability at Healthcare, whereas Lighting and Consumer Lifestyle continued to deliver a year-on-year operational margin improvement," Van Houten added. "Looking ahead, 2014 will be a challenging year, but we remain very confident."