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Philips Profits Plunge As Sales Fall 19%

Updated from 2:21 a.m. EDT

Philips Electronics (PHG - Get Report), the biggest consumer electronics maker in Europe, reported second-quarter net income of 44 million euros ($61.4 million), a 94% decline from year-earlier net income of 732 million euros as sales fell 19%.

However, earnings before interest, taxes and amortization of 118 million euros topped the estimates of analysts surveyed by Thomson Reuters. EBITA in the second quarter of 2008 was 396 million euros.

Sales in the quarter fell to 5.2 billion euros, "reflecting continuing weakness in consumer and professional markets," the company said.

Philips booked net gains of 533 million euros in the second quarter of 2008 after selling shares of Taiwan computer chip maker TSMC.

Philips remains cautious about the overall economy and said it "will not shy away from implementing further cost measures where needed." It said in January it would slash about 6,000 jobs this year.

Philips said it expects improvement in the second half of 2009 and "some early sequential improvement in comparable sales as well."

Among Philips' major operations, its health care division reported second-quarter profit of 93 million euros, while lighting had a loss of 57 million euros and consumer products lost 9 million euros.

Philips had debt of 800 million euros at the end of the quarter but held 3.6 billion euros in cash.

Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

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