Thanks to a 41% increase in sales from its acquisitions, Philips Medical Systems sales reached $7.35 billion (U.S.) in 2002, up 42% compared with the $5.155 billion reported in 2001. Excluding acquisitions, the Andover, MA-based company would have turned in 5% sales growth.
Sales volume increased 8%, while average prices declined by 3%. Currency movements resulted in a 4% negative impact, Philips said.
Philips pointed to sales gains in x-ray, CT, nuclear medicine, cardiac and monitoring systems, and customer support as key drivers. Regionally, sales growth was strongest in North America, Philips said.
Philips Medical Systems had 2002 income from operations (IFO) of $331.8 million, compared with a loss of $175.1 million in 2001. Excluding 2001 amortization of goodwill and $135.3 million of special acquisition-related and impairment charges, income from operations in 2002 would have climbed $43 million to a record $467.2 million, according to the vendor.
Philips said the increase in operating income was due mainly to improved sales in its x-ray, customer service, and CT/MR units. The company also reported a number of nonrecurring charges totaling $78.4 million, and IT cost increases of $62.3 million compared with 2001.
Despite delays and the high cost of integrating IT systems in its acquired companies, Philips said that the integration of the acquisitions, as well as a related restructuring program, are on schedule. The company expects the integration will yield savings of $375.9 million in 2003.
In its fourth quarter (end-December 31), Philips Medical Systems had sales of $2.022 billion, down 2% compared with $2.058 billion in the fourth quarter of 2001. Comparable sales grew 3%, however, with sales growth across all regions and product lines, Philips said. Excluding special items and amortization of goodwill, the company had operating income of $234.1 million, compared with a loss of $138.5 million in the same period last year.
By AuntMinnie.com staff writers
February 12, 2003
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