Dutch electronics giant Philips said Monday that net profits fell in the second quarter due to the coronavirus outbreak, but believed it would return to growth in the second half of the year.
Philips which recently abandoned its home appliance arm to focus on the health sector, said its net profit sank 14.63 percent year on year to 210 million euros, compared to 246 million in 2019.
“As anticipated, COVID-19 caused a steep decrease in consumer demand,” with the effect on non-virus hospital procedures involving its equipment having a particular impact, Phliips chief executive Frans van Houten said in a statement.
Sales dropped 6 percent year-on-year to 4.4 billion.
Demand for equipment including driven by CT imaging systems, hospital ventilators and patient monitors caused orders to grow by 27 percent.
“We have steeply ramped up the production volumes of acute care products and solutions to help diagnose, treat, monitor and manage COVID-19 patients,” van Houten said.
“We expect to return to growth and improved profitability for the group in the second half of the year, assuming we can convert our existing order book… elective procedures normalize, and consumer demand gradually improves,” van Houten said.
Amsterdam-based Philips started off as a lighting company more than 100 years ago but has undergone major changes in recent years.
It first divested its lighting division before announcing in January it was selling off its home appliance arm to fully concentrate on health sector products.