In a statement on Tuesday, Dutch health technology company Philips said that it is planning to increase returns to shareholders as the company is confident about registering sustained sales growth irrespective of economic headwinds.
A leading dealer of healthcare products ranging from medical imaging systems to high-tech toothbrushes, said that in the last three months of 2018, comparable sales climbed 5% to reach on 5.6 billion euros, while core profit witnessed a 10% raise to reach 971 million euros, on the back of the robust demand for its hospital equipment in Europe, Latin America and China.
Philips Chief Executive Frans van Houten said that they are expecting their performance momentum to improve tremendously within a year, irrespective of any kind of geopolitical bottlenecks and market volatility.
Van Houten confirmed the firm’s target to achieve 4% to 6% growth in total annual comparable sales until 2020. Philips, which spun off consumer electronics segments over past some year, and is presently rigorously focused on healthcare technology, added that it is going to raise dividends by 6%, and announced a new share buyback programme valuing 1.5 billion euros.
Additionally, the health technology company also said that it is going to move production worth ‘hundreds of millions’ of euros from the United States to China and vice versa, to alleviate the effects of the prevailing trade war between both the nations.
While speaking to media, Van Houten said that the upcoming changes would be serious to their supply chains, and shared his plans of ensuring the implementation of these plans in the first part of the next year to curtail the net effects for the entire 2019 year.
As a part of its productivity drive, Philips has also decided to decrease its number of factories across the world from 50 to 30. Previously in this month, the company denied the media reports that called the company’s decision to shun a baby bottle manufacturing plant in the nation a side effect of approaching Brexit.
Santosh Kumar is a respected voice in the ICT domain. He has authored over 30 studies pertaining to cloud, cybersecurity, AI, and Big Data.