Philips Medical Systems saw its profitability improve in its 2003 fiscal second quarter as the division of Dutch electronics giant Royal Philips Electronics enjoyed cost savings from the integration of its various operating units.
For the quarter, the Andover, MA-based medical division recorded operating income of $76.4 million (70 million euros), compared with income of $29.5 million in the second quarter of fiscal 2002.
The improvement was driven primarily by fewer special charges and about $44.7 million in savings related to corporate integration. The company incurred $21.8 million in information technology and supply chain management costs, an expenditure level that Philips expects to decline during 2003.
The medical division achieved higher profits despite a 20% drop in sales, due to divestment of the company’s Health Care Products (HCP) division, and the impact of a lower dollar on sales. For the quarter, Philips posted revenue of $1.45 billion, compared with $1.816 billion in the comparable quarter a year before. The company said that comparable sales were at about the same level as the second quarter of fiscal 2002.
By AuntMinnie.com staff writersApril 17, 2003
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