SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
October 21, 2013
KONINKLIJKE PHILIPS N.V.
(Exact name of registrant as specified in its charter)
Royal Philips
(Translation of registrants name into English)
The Netherlands
(Jurisdiction of incorporation or organization)
Breitner Center, Amstelplein 2, 1096 BC Amsterdam, The Netherlands
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule101(b)(7): ¨
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ¨ No x
Name and address of person authorized to receive notices
and communications from the Securities and Exchange Commission:
E.P. Coutinho
Koninklijke Philips N.V.
Amstelplein 2
1096 BC Amsterdam The Netherlands
This report comprises a copy of the following press release:
- Philips Third Quarter Results 2013, dated October 21, 2013.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf, by the undersigned, thereunto duly authorized at Amsterdam, on the 21st day of October 2013.
KONINKLIJKE PHILIPS N.V. |
/s/ E.P. Coutinho |
(General Secretary) |
Q3 2013 Quarterly report
Philips reports third-quarter comparable sales growth of 3% to EUR 5.6 billion; operational results improve by 33% to EUR 634 million
| Comparable sales in growth geographies up 10% |
| EBITA increased to EUR 562 million, or 10.0% of sales, compared to 6.3% in Q3 2012 |
| EBITA excluding restructuring and other charges increased to EUR 634 million, or 11.3% of sales |
| Net income increased to EUR 281 million, compared to EUR 105 million in Q3 2012 |
| Free cash flow amounted to EUR 117 million |
| New EUR 1.5 billion share buy-back program starts on October 21 |
Frans van Houten, CEO:
This was another solid quarter for Philips, especially in light of the challenging global economic environment. I am pleased with the 33% increase in our operational results, clearly reflecting the continuing benefits of our Accelerate! program. At Healthcare, EBITA improved while sales were flat and order intake declined by 2%. Consumer Lifestyle continued its strong sales performance with a comparable sales growth of 9%, driven by our focus on locally relevant products. At Lighting, LED-based sales grew 33% over the previous year, leading to an overall growth of 3%.
We continued to make good progress on the Accelerate! journey. Our overhead cost reduction program has resulted in EUR 856 million in total gross savings to date, including EUR 183 million realized in Q3 2013. Our End2End programs are delivering strong results. The leaning-out of the supply chain has led to a reduction of inventory. Our Design for Excellence (DfX) program is building a strong funnel of opportunities to lower cost of goods sold in the coming years. End2End also enables us to deliver more locally relevant innovations faster to our customers. We see strong positive engagement from our employees, making us more agile and entrepreneurial.
Our strategic focus on value-accretive innovations and new business models is resulting in encouraging successes across our markets. As the leader in the growing image-guided interventions and therapy market, Philips was the first company to install an advanced hybrid operating room in a leading medical institute in Moscow, which will serve as an example for other hospitals in Russia. Building on our leadership in digital innovation, we recently unveiled a range of higher-value connected consumer products, such as a smart air purifier, baby monitor and a digital grooming guide. As the global leader in energy-efficient lighting, we have been selected to transform Dubai Municipalitys buildings with intelligent LED solutions. Our lighting solutions are saving 50% in electricity usage and will advance Dubais mission to become the most sustainable city in the world.
We remain committed to reaching our financial targets this year. However, ongoing headwinds in the global economy are expected to continue to affect sales growth in the coming quarters.
Q3 financials: Operational results improve significantly across all sectors.
Healthcare currency-comparable equipment order intake declined by 2% year-on-year, with lower order intake at Patient Care & Clinical Informatics, while Imaging Systems recorded a slight increase. Comparable sales were flat year-on-year. Growth at Customer Services, Home Healthcare Solutions and Patient Care & Clinical Informatics was offset by a decline at Imaging Systems. In growth geographies, comparable sales increased by 3%, with strong growth in China, Central & Eastern Europe and Latin America. EBITA margin excluding restructuring and acquisition-related charges increased by 2.0 percentage points year-on-year to 14.6%.
Consumer Lifestyle comparable sales increased by 9%, with all businesses, i.e. Health & Wellness, Domestic Appliances and Personal Care, recording good growth. In the growth geographies, comparable sales registered a strong double-digit increase. EBITA margin excluding restructuring and acquisition-related charges increased to 11.1%, a year-on-year improvement of 3.0 percentage points.
Lighting comparable sales increased by 3%, led by Lumileds, Automotive and Light Sources & Electronics. Comparable sales at Professional Lighting Solutions and Consumer Luminaires declined in the quarter. LED-based sales grew by 33% and now represent 30% of total Lighting sales. In the growth geographies, comparable sales showed a double-digit increase. EBITA margin excluding restructuring and acquisition-related charges was 10.2%, a year-on-year improvement of 3.9 percentage points.
The new EUR 1.5 billion share buy-back program starts on October 21.
Please refer to page 21 of this press release for more information about forward-looking statements, third-party market share data, use of non-GAAP information and use of fair-value measurements.
Philips Group
Q3 2013 Quarterly report 3
4 Q3 2013 Quarterly report
Q3 2013 Quarterly report 5
6 Q3 2013 Quarterly report
Q3 2013 Quarterly report 7 |
8 Q3 2013 Quarterly report
Healthcare
Q3 2013 Quarterly report 9
10 Q3 2013 Quarterly report
Consumer Lifestyle*
* | Excluding the Audio, Video, Multimedia and Accessories business |
Q3 2013 Quarterly report 11
12 Q3 2013 Quarterly report
Lighting
Q3 2013 Quarterly report 13
14 Q3 2013 Quarterly report
Innovation, Group & Services
Q3 2013 Quarterly report 15
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Additional information on Audio, Video, Multimedia and Accessories business
Q3 2013 Quarterly report 17
18 Q3 2013 Quarterly report
Philips quarterly statistics
all amounts in millions of euros unless otherwise stated
2012 | 2013 | |||||||||||||||||||||||||||||
1st quarter | 2nd quarter | 3rd quarter | 4th quarter | 1st quarter | 2nd quarter | 3rd quarter | 4th quarter | |||||||||||||||||||||||
Sales |
5,307 | 5,570 | 5,821 | 6,759 | 5,258 | 5,654 | 5,618 | |||||||||||||||||||||||
comparable sales growth % |
5 | 6 | 7 | 5 | 1 | 3 | 3 | |||||||||||||||||||||||
Gross margin |
2,008 | 2,139 | 2,253 | 2,591 | 2,101 | 2,347 | 2,357 | |||||||||||||||||||||||
as a % of sales |
37.8 | 38.4 | 38.7 | 38.3 | 40.0 | 41.5 | 42.0 | |||||||||||||||||||||||
Selling expenses |
(1,196 | ) | (1,314 | ) | (1,298 | ) | (1,526 | ) | (1,190 | ) | (1,245 | ) | (1,214 | ) | ||||||||||||||||
as a % of sales |
(22.5 | ) | (23.6 | ) | (22.3 | ) | (22.6 | ) | (22.6 | ) | (22.0 | ) | (21.6 | ) | ||||||||||||||||
G&A expenses |
(199 | ) | (151 | ) | (222 | ) | (273 | ) | (200 | ) | (230 | ) | (253 | ) | ||||||||||||||||
as a % of sales |
(3.7 | ) | (2.7 | ) | (3.8 | ) | (4.0 | ) | (3.8 | ) | (4.1 | ) | (4.5 | ) | ||||||||||||||||
R&D expenses |
(450 | ) | (440 | ) | (447 | ) | (494 | ) | (424 | ) | (416 | ) | (437 | ) | ||||||||||||||||
as a % of sales |
(8.5 | ) | (7.9 | ) | (7.7 | ) | (7.3 | ) | (8.1 | ) | (7.4 | ) | (7.8 | ) | ||||||||||||||||
EBIT |
341 | 229 | 254 | (176 | ) | 305 | 509 | 464 | ||||||||||||||||||||||
as a % of sales |
6.4 | 4.1 | 4.4 | (2.6 | ) | 5.8 | 9.0 | 8.3 | ||||||||||||||||||||||
EBITA |
451 | 339 | 366 | (50 | ) | 402 | 603 | 562 | ||||||||||||||||||||||
as a % of sales |
8.5 | 6.1 | 6.3 | (0.7 | ) | 7.6 | 10.7 | 10.0 | ||||||||||||||||||||||
Net income (loss) |
183 | 102 | 105 | (420 | ) | 162 | 317 | 281 | ||||||||||||||||||||||
Net income (loss) attributable to shareholders |
182 | 102 | 104 | (423 | ) | 161 | 317 | 282 | ||||||||||||||||||||||
Net income (loss) - shareholders per common share in euros - diluted |
0.20 | 0.11 | 0.11 | (0.46 | ) | 0.17 | 0.35 | 0.31 |
Q3 2013 Quarterly report 19
Philips quarterly statistics (continued)
all amounts in millions of euros unless otherwise stated
2012 | 2013 | |||||||||||||||||||||||||||||
January- March |
January- June |
January- September |
January- December |
January- March |
January- June |
January- September |
January- December | |||||||||||||||||||||||
Sales |
5,307 | 10,877 | 16,698 | 23,457 | 5,258 | 10,912 | 16,530 | |||||||||||||||||||||||
comparable sales growth % |
5 | 6 | 6 | 6 | 1 | 2 | 2 | |||||||||||||||||||||||
Gross margin |
2,008 | 4,147 | 6,400 | 8,991 | 2,101 | 4,448 | 6,805 | |||||||||||||||||||||||
as a % of sales |
37.8 | 38.1 | 38.3 | 38.3 | 40.0 | 40.8 | 41.2 | |||||||||||||||||||||||
Selling expenses |
(1,196 | ) | (2,510 | ) | (3,808 | ) | (5,334 | ) | (1,190 | ) | (2,435 | ) | (3,649 | ) | ||||||||||||||||
as a % of sales |
(22.5 | ) | (23.1 | ) | (22.8 | ) | (22.7 | ) | (22.6 | ) | (22.3 | ) | (22.1 | ) | ||||||||||||||||
G&A expenses |
(199 | ) | (350 | ) | (572 | ) | (845 | ) | (200 | ) | (430 | ) | (683 | ) | ||||||||||||||||
as a % of sales |
(3.7 | ) | (3.2 | ) | (3.4 | ) | (3.6 | ) | (3.8 | ) | (3.9 | ) | (4.1 | ) | ||||||||||||||||
R&D expenses |
(450 | ) | (890 | ) | (1,337 | ) | (1,831 | ) | (424 | ) | (840 | ) | (1,277 | ) | ||||||||||||||||
as a % sales |
(8.5 | ) | (8.2 | ) | (8.0 | ) | (7.8 | ) | (8.1 | ) | (7.7 | ) | (7.7 | ) | ||||||||||||||||
EBIT |
341 | 570 | 824 | 648 | 305 | 814 | 1,278 | |||||||||||||||||||||||
as a % of sales |
6.4 | 5.2 | 4.9 | 2.8 | 5.8 | 7.5 | 7.7 | |||||||||||||||||||||||
EBITA |
451 | 790 | 1,156 | 1,106 | 402 | 1,005 | 1,567 | |||||||||||||||||||||||
as a % of sales |
8.5 | 7.3 | 6.9 | 4.7 | 7.6 | 9.2 | 9.5 | |||||||||||||||||||||||
Net income (loss) |
183 | 285 | 390 | (30 | ) | 162 | 479 | 760 | ||||||||||||||||||||||
Net income (loss) attributable to shareholders |
182 | 284 | 388 | (35 | ) | 161 | 478 | 760 | ||||||||||||||||||||||
Net income (loss) - shareholders per common share in euros - diluted |
0.20 | 0.31 | 0.42 | (0.04 | ) | 0.17 | 0.52 | 0.83 | ||||||||||||||||||||||
Net income (loss) from continuing operations as a % of shareholders equity |
6.3 | 4.3 | 4.0 | (0.6 | ) | 5.8 | 9.0 | 9.4 | ||||||||||||||||||||||
period ended 2012 | period ended 2013 | |||||||||||||||||||||||||||||
Number of common shares outstanding (after deduction of treasury shares) at the end of period (in thousands) |
915,926 | 931,391 | 923,912 | 914,591 | 905,381 | 913,874 | 915,095 | |||||||||||||||||||||||
Shareholders equity per common share in euros |
13.35 | 13.01 | 13.01 | 12.19 | 12.33 | 11.78 | 11.93 | |||||||||||||||||||||||
Inventories as a % of sales1) |
16.9 | 17.2 | 16.9 | 14.3 | 15.5 | 15.7 | 16.5 | |||||||||||||||||||||||
Inventories excluding discontinued operations |
3,623 | 3,812 | 3,877 | 3,359 | 3,629 | 3,696 | 3,832 | |||||||||||||||||||||||
Net debt : group equity ratio |
6:94 | 13:87 | 11:89 | 6:94 | 12:88 | 16:84 | 16:84 | |||||||||||||||||||||||
Net operating capital |
10,634 | 11,485 | 11,048 | 9,316 | 9,969 | 10,184 | 10,249 | |||||||||||||||||||||||
Total employees |
122,008 | 121,801 | 121,284 | 118,087 | 117,881 | 117,239 | 116,266 | |||||||||||||||||||||||
of which discontinued operations |
2,285 | 2,166 | 2,058 | 2,005 | 1,970 | 1,958 | 1,940 |
1) | sales is calculated over the preceding 12 months |
20 Q3 2013 Quarterly report
Forward-looking statements
Q3 2013 Quarterly report 21
Condensed consolidated statements of income
in millions of euros unless otherwise stated
3rd quarter | January to September | |||||||||||||||
2012 | 2013 | 2012 | 2013 | |||||||||||||
Sales |
5,821 | 5,618 | 16,698 | 16,530 | ||||||||||||
Cost of sales |
(3,568 | ) | (3,261 | ) | (10,298 | ) | (9,725 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Gross margin |
2,253 | 2,357 | 6,400 | 6,805 | ||||||||||||
Selling expenses |
(1,298 | ) | (1,214 | ) | (3,808 | ) | (3,649 | ) | ||||||||
General and administrative expenses |
(222 | ) | (253 | ) | (572 | ) | (683 | ) | ||||||||
Research and development expenses |
(447 | ) | (437 | ) | (1,337 | ) | (1,277 | ) | ||||||||
Other business income |
9 | 20 | 241 | 102 | ||||||||||||
Other business expenses |
(41 | ) | (9 | ) | (100 | ) | (20 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income from operations |
254 | 464 | 824 | 1,278 | ||||||||||||
Financial income |
13 | 15 | 62 | 51 | ||||||||||||
Financial expenses |
(129 | ) | (107 | ) | (352 | ) | (304 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income before taxes |
138 | 372 | 534 | 1,025 | ||||||||||||
Income tax expense |
(37 | ) | (108 | ) | (158 | ) | (298 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income after taxes |
101 | 264 | 376 | 727 | ||||||||||||
Results relating to investments in associates |
(6 | ) | 6 | (18 | ) | 21 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income from continuing operations |
95 | 270 | 358 | 748 | ||||||||||||
Discontinued operations - net of income tax |
10 | 11 | 32 | 12 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income |
105 | 281 | 390 | 760 | ||||||||||||
Attribution of net income for the period |
||||||||||||||||
Net income attributable to shareholders |
104 | 282 | 388 | 760 | ||||||||||||
Net income attributable to non-controlling interests |
1 | (1 | ) | 2 | | |||||||||||
Earnings per common share attributable to shareholders |
||||||||||||||||
Weighted average number of common shares outstanding (after deduction of treasury shares) during the period (in thousands): |
||||||||||||||||
- basic |
929,261 | 1) | 914,431 | 925,112 | 1) | 910,145 | ||||||||||
- diluted |
936,176 | 1) | 922,209 | 929,485 | 1) | 917,701 | ||||||||||
Net income attributable to shareholders per common share in euros: |
||||||||||||||||
- basic |
0.11 | 0.31 | 0.42 | 0.84 | ||||||||||||
- diluted |
0.11 | 0.31 | 0.42 | 0.83 |
1) | Adjusted to make 2012 comparable for the elective share dividend premium (273 thousand) issued in June 2013 |
22 Q3 2013 Quarterly report
Condensed consolidated balance sheets
in millions of euros unless otherwise stated
September 30, | December 31, | September 29, | ||||||||||
2012 | 2012 | 2013 | ||||||||||
Non-current assets: |
||||||||||||
Property, plant and equipment |
2,992 | 2,959 | 2,813 | |||||||||
Goodwill |
7,117 | 6,948 | 6,654 | |||||||||
Intangible assets excluding goodwill |
3,902 | 3,731 | 3,400 | |||||||||
Non-current receivables |
154 | 176 | 163 | |||||||||
Investments in associates |
195 | 177 | 165 | |||||||||
Other non-current financial assets |
557 | 549 | 596 | |||||||||
Deferred tax assets |
1,837 | 1,919 | 1,826 | |||||||||
Other non-current assets |
80 | 94 | 67 | |||||||||
|
|
|
|
|
|
|||||||
Total non-current assets |
16,834 | 16,553 | 15,684 | |||||||||
Current assets: |
||||||||||||
Inventories - net |
4,071 | 3,495 | 3,832 | |||||||||
Other current financial assets |
| | 10 | |||||||||
Other current assets |
412 | 337 | 425 | |||||||||
Derivative financial assets |
129 | 137 | 138 | |||||||||
Income tax receivable |
133 | 97 | 136 | |||||||||
Receivables |
4,522 | 4,585 | 4,580 | |||||||||
Assets classified as held for sale |
56 | 43 | 486 | |||||||||
Cash and cash equivalents |
3,232 | 3,834 | 2,034 | |||||||||
|
|
|
|
|
|
|||||||
Total current assets |
12,555 | 12,528 | 11,641 | |||||||||
|
|
|
|
|
|
|||||||
Total assets |
29,389 | 29,081 | 27,325 | |||||||||
Shareholders equity |
12,016 | 11,151 | 10,913 | |||||||||
Non-controlling interests |
36 | 34 | 38 | |||||||||
|
|
|
|
|
|
|||||||
Group equity |
12,052 | 11,185 | 10,951 | |||||||||
Non-current liabilities: |
||||||||||||
Long-term debt |
3,837 | 3,725 | 3,374 | |||||||||
Long-term provisions |
1,969 | 2,119 | 2,011 | |||||||||
Deferred tax liabilities |
144 | 92 | 104 | |||||||||
Other non-current liabilities |
1,955 | 2,005 | 1,754 | |||||||||
|
|
|
|
|
|
|||||||
Total non-current liabilities |
7,905 | 7,941 | 7,243 | |||||||||
Current liabilities: |
||||||||||||
Short-term debt |
859 | 809 | 692 | |||||||||
Derivative financial liabilities |
674 | 517 | 413 | |||||||||
Income tax payable |
142 | 200 | 119 | |||||||||
Accounts and notes payable |
2,997 | 2,839 | 3,076 | |||||||||
Accrued liabilities |
2,986 | 3,171 | 2,895 | |||||||||
Short-term provisions |
640 | 837 | 613 | |||||||||
Liabilities directly associated with assets held for sale |
33 | 27 | 245 | |||||||||
Other current liabilities |
1,101 | 1,555 | 1,078 | |||||||||
|
|
|
|
|
|
|||||||
Total current liabilities |
9,432 | 9,955 | 9,131 | |||||||||
|
|
|
|
|
|
|||||||
Total liabilities and group equity |
29,389 | 29,081 | 27,325 |
Q3 2013 Quarterly report 23
Condensed consolidated statements of cash flows
in millions of euros
3rd quarter |
January to September | |||||||||||||||
2012 | 2013 | 2012 | 2013 | |||||||||||||
Cash flows from operating activities: |
||||||||||||||||
Net income |
105 | 281 | 390 | 760 | ||||||||||||
Loss from discontinued operations |
(10 | ) | (11 | ) | (32 | ) | (12 | ) | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||
Fixed assets depreciation, amortization, and impairments |
346 | 330 | 1,016 | 946 | ||||||||||||
Impairment of goodwill and other non-current financial assets |
9 | 3 | 12 | 6 | ||||||||||||
Net gain (loss) on sale of assets |
33 | (9 | ) | (159 | ) | (49 | ) | |||||||||
(Income) loss from investments in associates |
3 | (7 | ) | 9 | (22 | ) | ||||||||||
Dividends received from investments in associates |
| | 7 | 6 | ||||||||||||
(Increase) decrease in working capital: |
139 | (357 | ) | (234 | ) | (1,247 | ) | |||||||||
Increase in receivables and other current assets |
(206 | ) | (428 | ) | (109 | ) | (421 | ) | ||||||||
Increase in inventories |
(157 | ) | (265 | ) | (443 | ) | (662 | ) | ||||||||
Increase (decrease) in accounts payable, accrued and other liabilities |
502 | 336 | 318 | (164 | ) | |||||||||||
(Increase) decrease in non-current receivables, other assets and other liabilities |
(62 | ) | 60 | (191 | ) | (79 | ) | |||||||||
Increase (decrease) in provisions |
51 | (76 | ) | 107 | (243 | ) | ||||||||||
Other items |
34 | 123 | 101 | 167 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net cash provided by operating activities |
648 | 337 | 1,026 | 233 | ||||||||||||
Cash flows from investing activities: |
||||||||||||||||
Purchase of intangible assets |
(11 | ) | (9 | ) | (25 | ) | (17 | ) | ||||||||
Proceeds from sale of intangible assets |
| | 160 | | ||||||||||||
Expenditures on development assets |
(86 | ) | (88 | ) | (250 | ) | (268 | ) | ||||||||
Capital expenditures on property, plant and equipment |
(144 | ) | (137 | ) | (449 | ) | (406 | ) | ||||||||
Proceeds from disposals of property, plant and equipment |
3 | 14 | 412 | 22 | ||||||||||||
Cash to derivatives and securities |
(9 | ) | (11 | ) | (54 | ) | (93 | ) | ||||||||
Purchase of other non-current financial assets |
(9 | ) | (1 | ) | (163 | ) | (5 | ) | ||||||||
Proceeds from other non-current financial assets |
| 6 | | 15 | ||||||||||||
Purchase of businesses, net of cash acquired |
(22 | ) | 1 | (253 | ) | (5 | ) | |||||||||
Proceeds from sale of interests in businesses, net of cash disposed of |
4 | (6 | ) | 13 | 85 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net cash used for investing activities |
(274 | ) | (231 | ) | (609 | ) | (672 | ) | ||||||||
Cash flows from financing activities: |
||||||||||||||||
Proceeds from issuance of (payments on) short-term debt |
(20 | ) | (76 | ) | 168 | (203 | ) | |||||||||
Principal payments on long-term debt |
(106 | ) | (126 | ) | (589 | ) | (167 | ) | ||||||||
Proceeds from issuance of long-term debt |
28 | 14 | 1,201 | 48 | ||||||||||||
Treasury shares transactions |
(135 | ) | (18 | ) | (577 | ) | (505 | ) | ||||||||
Dividends paid |
1 | (41 | ) | (255 | ) | (272 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net cash used for financing activities |
(232 | ) | (247 | ) | (52 | ) | (1,099 | ) | ||||||||
Net cash provided by (used for) continuing operations |
142 | (141 | ) | 365 | (1,538 | ) | ||||||||||
Cash flows from discontinued operations: |
||||||||||||||||
Net cash used for operating activities |
(70 | ) | (44 | ) | (273 | ) | (176 | ) | ||||||||
Net cash provided by (used for) investing activities |
70 | (39 | ) | 73 | (50 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net cash used for discontinued operations |
| (83 | ) | (200 | ) | (226 | ) | |||||||||
Net cash provided by (used for) continuing and discontinued operations |
142 | (224 | ) | 165 | (1,764 | ) |
24 Q3 2013 Quarterly report
3rd quarter | January to September | |||||||||||||||
Effect of change in exchange rates on cash and cash equivalents |
(44 | ) | (49 | ) | (80 | ) | (36 | ) | ||||||||
Cash and cash equivalents at the beginning of the period |
3,134 | 2,307 | 3,147 | 3,834 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Cash and cash equivalents at the end of the period |
3,232 | 2,034 | 3,232 | 2,034 | ||||||||||||
Net cash paid during the period for |
||||||||||||||||
Pensions |
(149 | ) | (157 | ) | (490 | ) | (489 | ) | ||||||||
Interest |
(102 | ) | (83 | ) | (210 | ) | (202 | ) | ||||||||
Income taxes |
(92 | ) | (139 | ) | (275 | ) | (378 | ) |
For a number of reasons, principally the effects of translation differences, certain items in the statements of cash flows do not correspond to the differences between the balance sheet amounts for the respective items.
Q3 2013 Quarterly report 25
Condensed consolidated statement of changes in equity
in millions of euros
common shares |
capital in excess of par value |
retained earnings |
revaluation reserve |
currency translation differences |
available -for-sale financial assets |
cash flow hedges |
treasury shares at cost |
total shareholders equity |
non- controlling interests |
total equity |
||||||||||||||||||||||||||||||||||
January-September 2013 |
||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2012 |
191 | 1,304 | 10,724 | 54 | (93 | ) | 54 | 20 | (1,103 | ) | 11,151 | 34 | 11,185 | |||||||||||||||||||||||||||||||
Net income |
760 | 760 | | 760 | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income, net of tax |
(24 | ) | (12 | ) | (277 | ) | 8 | (6 | ) | (311 | ) | (311 | ) | |||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total comprehensive income |
736 | (12 | ) | (277 | ) | 8 | (6 | ) | 449 | | 449 | |||||||||||||||||||||||||||||||||
Dividend distributed |
4 | 402 | (678 | ) | (272 | ) | (272 | ) | ||||||||||||||||||||||||||||||||||||
Movement non-controlling interest |
| | 4 | 4 | ||||||||||||||||||||||||||||||||||||||||
Cancellation of treasury shares |
(7 | ) | (780 | ) | 787 | | | |||||||||||||||||||||||||||||||||||||
Purchase of treasury shares |
(38 | ) | (531 | ) | (569 | ) | (569 | ) | ||||||||||||||||||||||||||||||||||||
Re-issuance of treasury shares |
(37 | ) | (58 | ) | 167 | 72 | 72 | |||||||||||||||||||||||||||||||||||||
Share-based compensation plans |
74 | 74 | 74 | |||||||||||||||||||||||||||||||||||||||||
Income tax share-based compensation plans |
8 | 8 | 8 | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total other equity movements |
(3 | ) | 447 | (1,554 | ) | 423 | (687 | ) | 4 | (683 | ) | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Balance as of September 29, 2013 |
188 | 1,751 | 9,906 | 42 | (370 | ) | 62 | 14 | (680 | ) | 10,913 | 38 | 10,951 |
26 Q3 2013 Quarterly report
Sectors
in millions of euros unless otherwise stated
Sales and income from operations
3rd quarter | ||||||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||||||
sales | income from operations as a % of sales |
sales | income from operations as a % of sales |
|||||||||||||||||||||
Healthcare |
2,443 | 255 | 10.4 | 2,258 | 283 | 12.5 | ||||||||||||||||||
Consumer Lifestyle |
1,051 | 63 | 6.0 | 1,091 | 102 | 9.3 | ||||||||||||||||||
Lighting |
2,139 | (14 | ) | (0.7 | ) | 2,084 | 140 | 6.7 | ||||||||||||||||
Innovation, Group & Services |
188 | (50 | ) | | 185 | (61 | ) | | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Philips Group |
5,821 | 254 | 4.4 | 5,618 | 464 | 8.3 |
Sales and income from operations
January to September | ||||||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||||||
sales | income from operations as a % of sales |
sales | income from operations as a % of sales |
|||||||||||||||||||||
Healthcare |
7,065 | 665 | 9.4 | 6,747 | 838 | 12.4 | ||||||||||||||||||
Consumer Lifestyle |
2,934 | 287 | 9.8 | 3,177 | 255 | 8.0 | ||||||||||||||||||
Lighting |
6,180 | 22 | 0.4 | 6,107 | 365 | 6.0 | ||||||||||||||||||
Innovation, Group & Services |
519 | (150 | ) | | 499 | (180 | ) | | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Philips Group |
16,698 | 824 | 4.9 | 16,530 | 1,278 | 7.7 |
Q3 2013 Quarterly report 27
Sectors and main countries
in millions of euros
Sales total assets and total liabilities
sales | total assets | total liabilities excluding debt | ||||||||||||||||||||||
January to September | September 30, | September 29, | September 30, | September 29, | ||||||||||||||||||||
2012 | 2013 | 2012 | 2013 | 2012 | 2013 | |||||||||||||||||||
Healthcare |
7,065 | 6,747 | 11,617 | 10,783 | 3,269 | 3,172 | ||||||||||||||||||
Consumer Lifestyle |
2,934 | 3,177 | 3,506 | 3,007 | 2,063 | 1,843 | ||||||||||||||||||
Lighting |
6,180 | 6,107 | 7,316 | 7,150 | 2,243 | 2,461 | ||||||||||||||||||
Innovation, Group & Services |
519 | 499 | 6,894 | 5,899 | 5,033 | 4,587 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
29,333 | 26,839 | 12,608 | 12,063 | |||||||||||||||||||||
Assets and liabilities classified as held for sale |
56 | 486 | 33 | 245 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Philips Group |
16,698 | 16,530 | 29,389 | 27,325 | 12,641 | 12,308 |
Sales and tangible and intangible assets
sales | tangible and intangible assets1) | |||||||||||||||
January to September | September 30, | September 29, | ||||||||||||||
2012 | 2013 | 2012 | 2013 | |||||||||||||
Netherlands |
436 | 463 | 892 | 867 | ||||||||||||
United States |
4,974 | 4,699 | 8,280 | 7,572 | ||||||||||||
China |
1,847 | 2,045 | 1,122 | 1,093 | ||||||||||||
Germany |
914 | 926 | 261 | 282 | ||||||||||||
Japan |
842 | 761 | 621 | 439 | ||||||||||||
France |
663 | 633 | 89 | 82 | ||||||||||||
India |
520 | 493 | 156 | 126 | ||||||||||||
Other countries |
6,502 | 6,510 | 2,590 | 2,406 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Philips Group |
16,698 | 16,530 | 14,011 | 12,867 |
1) | Includes property, plant and equipment, goodwill, and intangible assets excluding goodwill |
28 Q3 2013 Quarterly report
Pension costs
in millions of euros
Specification of pension costs
3rd quarter | ||||||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||||||
Netherlands | other | total | Netherlands | other | total | |||||||||||||||||||
Defined-benefit plans |
||||||||||||||||||||||||
Pensions |
||||||||||||||||||||||||
Current service cost |
44 | 21 | 65 | 48 | 23 | 71 | ||||||||||||||||||
Past service cost (incl. curtailments) |
| | | | | | ||||||||||||||||||
Settlements |
| | | | 31 | 31 | ||||||||||||||||||
Interest expense |
| 19 | 19 | | 17 | 17 | ||||||||||||||||||
Interest income |
(1 | ) | | (1 | ) | (1 | ) | | (1 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
43 | 40 | 83 | 47 | 71 | 118 | ||||||||||||||||||
of which discontinued operations |
| | | | | | ||||||||||||||||||
Retiree Medical |
||||||||||||||||||||||||
Interest expense |
| 3 | 3 | | 2 | 2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
| 3 | 3 | | 2 | 2 | ||||||||||||||||||
Defined-contribution plans |
||||||||||||||||||||||||
Cost |
3 | 34 | 37 | 3 | 34 | 37 | ||||||||||||||||||
of which discontinued operations |
| 1 | 1 | | 1 | 1 |
Specification of pension costs
January to September | ||||||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||||||
Netherlands | other | total | Netherlands | other | total | |||||||||||||||||||
Defined-benefit plans |
||||||||||||||||||||||||
Pensions |
||||||||||||||||||||||||
Current service cost |
131 | 65 | 196 | 144 | 64 | 208 | ||||||||||||||||||
Past service cost (incl. curtailments) |
| | | | (78 | ) | (78 | ) | ||||||||||||||||
Settlements |
| | | | 31 | 31 | ||||||||||||||||||
Interest expense |
| 57 | 57 | | 49 | 49 | ||||||||||||||||||
Interest income |
(3 | ) | | (3 | ) | (3 | ) | | (3 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
128 | 122 | 250 | 141 | 66 | 207 | ||||||||||||||||||
of which discontinued operations |
1 | 1 | 2 | 1 | | 1 | ||||||||||||||||||
Retiree Medical |
||||||||||||||||||||||||
Current service cost |
| 1 | 1 | | 1 | 1 | ||||||||||||||||||
Past service cost (incl. curtailments) |
| (25 | ) | (25 | ) | | | | ||||||||||||||||
Interest expense |
| 9 | 9 | | 8 | 8 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
| (15 | ) | (15 | ) | | 9 | 9 | ||||||||||||||||
Defined-contribution plans |
||||||||||||||||||||||||
Cost |
8 | 101 | 109 | 7 | 105 | 112 | ||||||||||||||||||
of which discontinued operations |
1 | 3 | 4 | | 2 | 2 |
Q3 2013 Quarterly report 29
Reconciliation of non-GAAP performance measures
in millions of euros unless otherwise stated
Certain non-GAAP financial measures are presented when discussing the Philips Groups performance. In the following tables, a reconciliation to the most directly comparable IFRS performance measure is made.
Sales growth composition
in %
3rd quarter | January to September | |||||||||||||||||||||||||||||||
comparable growth |
currency effects |
consolidation changes |
nominal growth |
comparable growth |
currency effects |
consolidation changes |
nominal growth |
|||||||||||||||||||||||||
2013 versus 2012 |
||||||||||||||||||||||||||||||||
Healthcare |
0.0 | (7.1 | ) | (0.5 | ) | (7.6 | ) | (0.5 | ) | (3.8 | ) | (0.2 | ) | (4.5 | ) | |||||||||||||||||
Consumer Lifestyle |
9.3 | (5.5 | ) | 0.0 | 3.8 | 10.8 | (2.5 | ) | 0.0 | 8.3 | ||||||||||||||||||||||
Lighting |
3.0 | (5.8 | ) | 0.2 | (2.6 | ) | 1.5 | (2.7 | ) | 0.0 | (1.2 | ) | ||||||||||||||||||||
Innovation, Group & Services |
(6.9 | ) | (1.3 | ) | 6.6 | (1.6 | ) | (8.3 | ) | (0.5 | ) | 4.9 | (3.9 | ) | ||||||||||||||||||
|
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|
|
|
|
|
|||||||||||||||||
Philips Group |
2.5 | (6.1 | ) | 0.1 | (3.5 | ) | 2.0 | (3.1 | ) | 0.1 | (1.0 | ) |
EBITA (or Adjusted income from operations) to Income from operations (or EBIT)
3rd quarter | January to September | |||||||||||||||||||||||
Income from operations (or EBIT) |
Amortization of intangibles1) |
EBITA (or Adjusted income from operations) |
Income from operations (or EBIT) |
Amortization of intangibles1) |
EBITA (or Adjusted income from operations) |
|||||||||||||||||||
2013 |
||||||||||||||||||||||||
Healthcare |
283 | (46 | ) | 329 | 838 | (133 | ) | 971 | ||||||||||||||||
Consumer Lifestyle |
102 | (14 | ) | 116 | 255 | (41 | ) | 296 | ||||||||||||||||
Lighting |
140 | (37 | ) | 177 | 365 | (112 | ) | 477 | ||||||||||||||||
Innovation, Group & Services |
(61 | ) | (1 | ) | (60 | ) | (180 | ) | (3 | ) | (177 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Philips Group |
464 | (98 | ) | 562 | 1,278 | (289 | ) | 1,567 | ||||||||||||||||
2012 |
||||||||||||||||||||||||
Healthcare |
255 | (50 | ) | 305 | 665 | (150 | ) | 815 | ||||||||||||||||
Consumer Lifestyle |
63 | (15 | ) | 78 | 287 | (42 | ) | 329 | ||||||||||||||||
Lighting |
(14 | ) | (46 | ) | 32 | 22 | (134 | ) | 156 | |||||||||||||||
Innovation, Group & Services |
(50 | ) | (1 | ) | (49 | ) | (150 | ) | (6 | ) | (144 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Philips Group |
254 | (112 | ) | 366 | 824 | (332 | ) | 1,156 |
1) | Excluding amortization of software and product development |
30 Q3 2013 Quarterly report
Reconciliation of non-GAAP performance measures (continued)
in millions of euros
Net operating capital to total assets
Philips Group | Healthcare | Consumer Lifestyle |
Lighting | IG&S | ||||||||||||||||
September 29, 2013 |
||||||||||||||||||||
Net operating capital (NOC) |
10,249 | 7,525 | 1,164 | 4,668 | (3,108 | ) | ||||||||||||||
Exclude liabilities comprised in NOC: |
||||||||||||||||||||
- payables/liabilities |
9,335 | 2,730 | 1,565 | 1,851 | 3,189 | |||||||||||||||
- intercompany accounts |
| 159 | 79 | 126 | (364 | ) | ||||||||||||||
- provisions |
2,624 | 283 | 199 | 484 | 1,658 | |||||||||||||||
Include assets not comprised in NOC: |
||||||||||||||||||||
- investments in associates |
165 | 86 | | 21 | 58 | |||||||||||||||
- other current financial assets |
10 | | | | 10 | |||||||||||||||
- other non-current financial assets |
596 | | | | 596 | |||||||||||||||
- deferred tax assets |
1,826 | | | | 1,826 | |||||||||||||||
- cash and cash equivalents |
2,034 | | | | 2,034 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
26,839 | 10,783 | 3,007 | 7,150 | 5,899 | ||||||||||||||||
Assets classified as held for sale |
486 | |||||||||||||||||||
|
|
|||||||||||||||||||
Total assets |
27,325 | |||||||||||||||||||
December 31, 2012 |
||||||||||||||||||||
Net operating capital (NOC) |
9,316 | 7,976 | 1,205 | 4,635 | (4,500 | ) | ||||||||||||||
Exclude liabilities comprised in NOC: |
||||||||||||||||||||
- payables/liabilities |
10,287 | 2,760 | 1,718 | 1,695 | 4,114 | |||||||||||||||
- intercompany accounts |
| 71 | 42 | 37 | (150 | ) | ||||||||||||||
- provisions |
2,956 | 355 | 315 | 581 | 1,705 | |||||||||||||||
Include assets not comprised in NOC: |
||||||||||||||||||||
- investments in associates |
177 | 86 | | 22 | 69 | |||||||||||||||
- other non-current financial assets |
549 | | | | 549 | |||||||||||||||
- deferred tax assets |
1,919 | | | | 1,919 | |||||||||||||||
- cash and cash equivalents |
3,834 | | | | 3,834 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
29,038 | 11,248 | 3,280 | 6,970 | 7,540 | ||||||||||||||||
Assets classified as held for sale |
43 | |||||||||||||||||||
|
|
|||||||||||||||||||
Total assets |
29,081 | |||||||||||||||||||
September 30, 2012 |
||||||||||||||||||||
Net operating capital (NOC) |
11,048 | 8,261 | 1,443 | 5,051 | (3,707 | ) | ||||||||||||||
Exclude liabilities comprised in NOC: |
||||||||||||||||||||
- payables/liabilities |
9,855 | 2,920 | 1,703 | 1,792 | 3,440 | |||||||||||||||
- intercompany accounts |
| 68 | 32 | 54 | (154 | ) | ||||||||||||||
- provisions |
2,609 | 281 | 328 | 397 | 1,603 | |||||||||||||||
Include assets not comprised in NOC: |
||||||||||||||||||||
- investments in associates |
195 | 87 | | 22 | 86 | |||||||||||||||
- other non-current financial assets |
557 | | | | 557 | |||||||||||||||
- deferred tax assets |
1,837 | | | | 1,837 | |||||||||||||||
- cash and cash equivalents |
3,232 | | | | 3,232 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
29,333 | 11,617 | 3,506 | 7,316 | 6,894 | ||||||||||||||||
Assets held for sale |
56 | |||||||||||||||||||
|
|
|||||||||||||||||||
Total assets |
29,389 |
Q3 2013 Quarterly report 31
Reconciliation of non-GAAP performance measures (continued)
in millions of euros
Composition of net debt to group equity
September 30, 2012 |
December 31, 2012 |
September 29, 2013 |
||||||||||
Long-term debt |
3,837 | 3,725 | 3,374 | |||||||||
Short-term debt |
859 | 809 | 692 | |||||||||
|
|
|
|
|
|
|||||||
Total debt |
4,696 | 4,534 | 4,066 | |||||||||
Cash and cash equivalents |
3,232 | 3,834 | 2,034 | |||||||||
|
|
|
|
|
|
|||||||
Net debt (cash) (total debt less cash and cash equivalents) |
1,464 | 700 | 2,032 | |||||||||
Shareholders equity |
12,016 | 11,151 | 10,913 | |||||||||
Non-controlling interests |
36 | 34 | 38 | |||||||||
|
|
|
|
|
|
|||||||
Group equity |
12,052 | 11,185 | 10,951 | |||||||||
Net debt and group equity |
13,516 | 11,885 | 12,983 | |||||||||
Net debt divided by net debt and group equity (in %) |
11 | 6 | 16 | |||||||||
Group equity divided by net debt and group equity (in %) |
89 | 94 | 84 |
Composition of cash flows
3rd quarter |
January to September | |||||||||||||||
2012 | 2013 | 2012 | 2013 | |||||||||||||
Cash flows provided by operating activities |
648 | 337 | 1,026 | 233 | ||||||||||||
Cash flows used for investing activities |
(274 | ) | (231 | ) | (609 | ) | (672 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Cash flows before financing activities |
374 | 106 | 417 | (439 | ) | |||||||||||
Cash flows provided by operating activities |
648 | 337 | 1,026 | 233 | ||||||||||||
Net capital expenditures: |
(238 | ) | (220 | ) | (152 | ) | (669 | ) | ||||||||
Purchase of intangible assets |
(11 | ) | (9 | ) | (25 | ) | (17 | ) | ||||||||
Proceeds from sale of intangible assets |
| | 160 | | ||||||||||||
Expenditures on development assets |
(86 | ) | (88 | ) | (250 | ) | (268 | ) | ||||||||
Capital expenditures on property, plant and equipment |
(144 | ) | (137 | ) | (449 | ) | (406 | ) | ||||||||
Proceeds from sale of property, plant and equipment |
3 | 14 | 412 | 22 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Free cash flows |
410 | 117 | 874 | (436 | ) |
32 Q3 2013 Quarterly report
© 2013 Koninklijke Philips N.V. | http://www.philips.com/investorrelations | |
All rights reserved. |