Diagnostic imaging propels Philips growth in Q4

2019 12 10 18 30 7564 Philips Rsna 2019 400

Strong growth in the high single digits for its diagnostic imaging equipment helped propel fourth-quarter financial results in the healthcare business at Philips. Meanwhile, the company's Personal Health segment slipped on lower sales of oral healthcare products.

For the quarter (end-December 31, 2020), Philips' Diagnosis & Treatment division saw sales of 2.458 billion euros ($2.98 billion U.S.), down 5% on a nominal basis from sales of 2.582 billion euros ($3.13 billion) in the same period the year before, but up 1% after adjusting for currency changes. The division's earnings before interest, taxes, and amortization (EBITA) were 314 million euros ($381 million), unchanged from the year before.

In discussing the fourth-quarter results, Philips said it saw high-single-digit growth in sales of diagnostic imaging systems and a midsingle-digit decline in sales of image-guided therapy and ultrasound systems, due to the postponement of system sales because of the COVID-19 pandemic. The decline also led to a 14% drop in EBITA margin.

On a geographic basis, growth was driven by higher sales in China and Central and Eastern Europe, which was partially offset by the Middle East and Turkey. There was a decline in the low single digits in mature geographies, with low-single-digit growth in Western Europe and a midsingle-digit decline in North America.

For the full year, the Diagnosis & Treatment business saw sales of 8.175 billion euros ($9.92 billion), down 4% on a nominal basis and down 2% after currency adjustment from sales of 8.485 billion ($10.3 billion) for all of 2019. The division's EBITA for 2020 was 704 million euros ($854.5 million), compared with EBITA of 856 million euros ($1.039 billion) in 2019.

The company's Personal Health business saw sales of 1.824 billion euros ($2.21 billion), down 1% on a nominal basis but up 5% after currency adjustment from sales of 1.85 billion euros ($2.25 billion) in the fourth quarter of 2019. The company said that sales of oral healthcare products saw a decline in the low single digits.

For the full year, the Personal Health business saw sales of 5.407 billion euros ($6.56 billion), down 8% on a nominal basis and down 4% after currency adjustment from sales of 5.854 billion euros ($7.11 billion) in 2019. The division's EBITA was 639 million euros ($775.6 million) in 2020, compared with 869 million euros ($1.055 billion) in 2019.

Philips said a strong recovery in the second half of the year was not enough to offset declines in the Personal Health business in the first half, with the company seeing a decline in the high single digits in oral healthcare.

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