Philips earnings soar in third quarter

Third-quarter profits at Philips Electronics surged on one-time gains from stakes sold in two companies floated on the capital...

Third-quarter profits at Philips Electronics surged on one-time gains from stakes sold in two companies floated on the capital market, Europe's largest consumer electronics maker said.

Net profit rose to €1.17bn (£806m) from €124m a year earlier.

The profit figure included a €635m gain from selling a stake in Chicago-based Navteq, which manufacturers car-navigation software, in an initial public offering (IPO) in August and a €108m gain from the July IPO of LG Philips LCD.

Sales in the third quarter rose 3% to €7.23bn from €6.99bn a year earlier.

Philips, which was founded in the late 1891 as a lamp maker, said sales in its core consumer electronic business rose 3% to €2.28bn from €2.21bn. Semiconductor sales increased 11% to €1.39bn from €1.25bn.

Results for the third quarter were solid and improving across a broad front, and 2004 will be one of the company's better years, Philips said.

However, the company's consumer products division is operating in a very competitive environment, and profit margins there came under heavy pressure, it said.

John Blau writes for IDG News Service

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