April 23 - The CEO of Philips Electronics talks to Reuters about the electronics giant's better-than-expected quarterly results which suggest a long-awaited turnaround under new management is beginning to show dividends. Sonia Legg reports.
It was once best-known for its televisions but those days it seems are long gone for Philips Electronics. The Dutch group is now focussing on medical equipment and lighting systems, instead of consumer electronics. And says - CEO Frans Van Houten - the change of direction is paying off. (SOUNDBITE) (English) FRANS VAN HOUTEN, PHILIPS' CHIEF EXECUTIVE, SAYING: "The world is ageing - there is more and more people with chronic disease - as the same time the healthcare system needs to have more productivity. The innovations that Philips brings to the market can drive productivity for the healthcare system. We think that the repositioning of Philips towards healthcare foremost and energy efficient lighting makes for a very attractive future play." Philips' net profit jumped 80 percent this quarter to almost 250 million euros. Sales were also up seven percent to 5.6 billion euros. The figures were better than expected but the outlook for Europe's largest consumer producer isn't as bright. The company is worried about fragile consumer spending and government budget cuts - something the Dutch government decided to resign over on Monday. (SOUNDBITE) (English) FRANS VAN HOUTEN, PHILIPS' CHIEF EXECUTIVE, SAYING: "In my own country the Netherlands I do believe that the government was on the right path to take a plate of important measures to make the country healthy and set up for the future and it is regrettable that the country is no longer able to continue with those measures." The positive results are seen as a sign that recent management changes and restricting are paying off. But Philips says the cost of the changes and investments needed to make it happen will continue to impact results for the rest of the year. Sonia Legg, Reuters